Diageo Fiscal Year Profit Seen to Grow; Buyback Program Reinstated -- Update

--Diageo's organic operating growth anticipated to grow at least 14% in fiscal 2021

--Liquor maker's second phase of buyback program of up to GBP1 billion reinstated

--Company's performance recovered well across all regions, specially in North America

By Sabela Ojea

Diageo PLC said Wednesday that it expects to report organic operating growth of at least 14% in fiscal 2021, adding that its share-buyback program has been recommenced.

The world's largest liquor maker--which owns Johnnie Walker whisky and Tanqueray gin--said that its organic operating growth is also anticipated to be slightly ahead of net sales growth for the year ending June 30.

The FTSE 100 listed company added that it continued to deliver a good recovery across all regions, noting that its performance in its largest market, North America, remained particularly strong.

In Europe, the company is benefiting from strong execution in the off-trade channel (retailers such as supermarkets) and the partial reopening of the on-trade channel (bars, hotels and restaurants) in several markets, it said, adding that it is seeing strong recovery levels in most markets of Africa, Asia Pacific and Latin America.

However, it noted that travel retail is still severely hit by the coronavirus pandemic.

Regarding its share-buyback program, Diageo said that its 4.5 billion pounds ($6.36 billion) return of capital program will be completed by June 30, 2024, adding that it had to be extended two years because of the effects of the coronavirus pandemic.

The second phase of its buyback program of up to GBP1 billion has just been reinstated, which will be completed by the end of fiscal 2022.

"I am very pleased with how our business is recovering in fiscal 2021, our strong competitive performance across key markets and our robust cash generation," Chief Executive Ivan Menezes said.

Write to Sabela Ojea at [e-mail]; @sabelaojeaguix

(END) Dow Jones Newswires

May 12, 2021 03:02 ET (07:02 GMT)

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