The company noted the sales growth “reflects contined growth of the on-trade, resilient consumer demand in the off-trade and market shares gains and was underpinned by favorable industry share trends of spirits taking share of total bev/al and by premiumization.” Earnings per share rose 23.2%.
In North America, reported net sales grew 17% (organic, 14%), largely driven by U.S. spirits, the company said. U.S. spirits net sales grew 17%, Diageo said, reflecting recovery on the on-trade channel and resilient consumer demand in the off-trade channel, spirits taking share of total bev/al, and replenishment of stock levels by distributors. U.S. Spirits shipments were ahead of depletions, the company added.
U.S. spirits growth was driven primarily by tequila, up 57%, as well as double-digit growth in scotch and U.S. whiskey and growth in Canadian whisky. “This more than offset declines in Baileys and in rum. ”
Diageo Beer Co. net sales rose 2%, reflecting increased sales of Guinness, which were driven by on-premise recovery and ready-to-drink recovery, partially offset by a decline in flavored malt beverages.
CEO Ivan Menezes said he was “very pleased with our fiscal 22 results. We delivered double-digit organic net sales growth across all regions and we gained or held off-trade market share in over 85%(1) of our total net sales value in measured markets. We expanded operating margin while increasing marketing investment ahead of net sales growth and we used our strong cash generation to invest in long-term growth. I am very proud of what my 28,000 colleagues have achieved through their energy and creativity.
“In a year of significant global supply chain disruption, our double-digit volume growth demonstrates the tremendous agility and resourcefulness of our teams. Our net sales growth was across categories. We benefitted from the on-trade recovery, continued global premiumization trends, with our super-premium-plus brands up 31%, and from price increases across our regions. I am particularly proud of the performance of Johnnie Walker, which delivered double-digit growth across all regions to surpass 21 million cases globally. This fantastic milestone exemplifies our world-class brand-building and execution capabilities.
“Looking ahead to fiscal 23, we expect the operating environment to be challenging, with ongoing volatility related to Covid-19, significant cost inflation, a potential weakening of consumer spending power and global geopolitical and macroeconomic uncertainty. Notwithstanding these factors, I am confident in the resilience of our business and our ability to navigate these headwinds.
“We believe we have an advantaged portfolio with extraordinary brands across geographies, categories and price points. And we continue to actively shape our portfolio to fast-growing categories through innovation and acquisitions. We are staying close to our consumers and our digital tools and data capabilities enable us to quickly understand trends and execute with precision.
“Total beverage alcohol is an attractive sector with strong fundamentals and we are making good progress towards our ambition of delivering a 50% increase in our value share to 6% by 2030. Despite the challenging environment, we are executing our strategic priorities, including our ambitious 10-year sustainability plan. I am confident that we are well-positioned to deliver our medium-term guidance for fiscal 23 to fiscal 25 of organic net sales growth consistently in the range of 5% to 7% and organic operating profit growth sustainably in the range of 6% to 9%.”