Diageo optimistic as markets recover from Covid-19 pandemic
Diageo Plc has expressed optimism over progressive improvement in its organic net sales and operating profit.
Recall that Diageo’s net sales were down 8.7% (year ending June 30, 2020) due to the coronavirus pandemic.
According to Diageo’s chief executive, Ivan Menezes, the company is witnessing a successive improvement across all regions as markets start to recover from Covid-19 pandemic.
Specifically, Menezes said that the United States, Diageo’s biggest market which accounts for around 39% sales, has been performing very well over the last three months, noting that the pace of recovery from Covid-19 pandemic differs by markets, particularly due to varying government restrictions.
In Europe, the company boss noted that off-trade demand remains robust, and the on-trade channel has largely re-opened with the easing of lockdown measures in many countries, explaining, however, that the risk of additional restrictions remains where infection rates are worsening.
“The on-trade has also begun to re-open in Africa and other regions, and as such, we expect the pace of recovery in those markets to be more gradual, as travel retail continues to be severely impacted,” he said.
Menezes is impressed with the resilience of Diageo’s business and trade segment in the current challenging operating environment, and expressed confidence in the company’s strategy, coupled with its long-term fundamentals.
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