Pandemic a serious challenge for our ageing brands ^Heather, Guinness Correspondent

20 minutes ago

Happy , Guinness fans! The 21st Amendment was ratified today in 1933, which repealed the 18th Amendment, ended US Prohibition & made the first brewery in the US in the 1940s possible. How are you celebrating today? ^Heather, Guinness Correspondent

Alcohol deaths hit record high during Covid pandemic

Deaths caused by alcohol hit a new high during the first nine months of 2020, provisional figures for England and Wales show.

Deaths caused by alcohol hit a new high during the first nine months of 2020, provisional figures for England and Wales show.

Between January and September, 5,460 deaths were registered with this cause – up 16% on the same months in 2019.

It is the biggest toll recorded since records began in 2001.

The high rates spanned the period during and after the first Covid lockdown, the Office for National Statistics figures show.

It reached a peak of 12.8 deaths per 100,000 people in the first three months of 2020 and remained at this level through to September – higher than in any other time on record.

As in past years, rates of male alcohol-specific deaths were twice those seen for women.

Experts say the coronavirus pandemic will have had little effect on how the data was gathered and recorded.

But it is not clear how much it may have contributed to the deaths.

Reported operating profit (£2.1 billion) declined 47.1% @Diageo_News

2020 Preliminary Results, year ended 30 June 2020

Consistent first half performance significantly impacted by Covid-19 in the second half

  • Reported net sales (£11.8 billion) were down 8.7% driven by organic declines. Reported operating profit (£2.1 billion) declined 47.1%, driven mainly by exceptional operating items and organic net sales.
  • Organic net sales were down 8.4%, with growth in North America more than offset by declines in all other regions. Organic volumes were down 11.2%.
  • Organic operating profit was down 14.4%, ahead of organic net sales, driven by volume declines, cost inflation and unabsorbed fixed costs that were partially offset by short term cost reductions and ongoing productivity benefits.
  • Solid cash flow delivery with net cash from operating activities at £2.3 billion, £0.9 billion lower than prior period and free cash flow at £1.6 billion, £1.0 billion lower than prior period, in each case largely due to lower organic operating profit, lower dividends from associates, one-off tax impacts and increased working capital use.
  • Measures have been put in place to reinforce Diageo’s already solid liquidity including pausing the current three-year return of capital programme, bringing forward a £2.0bn USD bond issuance launched in April 2020 and putting in place an additional committed credit facility of £2.5 billion.
  • Exceptional operating items included non-cash impairment charges of £1.3 billion. These were in India, Nigeria, Ethiopia and on the Windsor brand in Korea, reflecting the impact of Covid-19 and challenging trading conditions.
  • Basic eps of 60.1 pence decreased by 54.0% primarily due to exceptional operating items. Pre-exceptional eps declined 16.4% to 109.4 pence, driven primarily by lower operating profit.
  • The final recommended dividend of 42.47 pence per share is the same as the final dividend for fiscal 19. This brings the full year dividend for fiscal 20 to 69.88 pence per share, an increase of 2%.

Ivan Menezes, Chief Executive, commenting on the results said:

“Fiscal 20 was a year of two halves: after good, consistent performance in the first half of fiscal 20, the outbreak of Covid-19 presented significant challenges for our business, impacting the full year performance. Through these challenging times we have acted quickly to protect our people and our business, and to support our customers, partners and communities.

The actions we have taken to strengthen Diageo over the last six years provide a solid foundation to respond to the impacts of the pandemic. We are now a more agile, efficient and effective business.

We have taken decisive action through the second half of fiscal 20, tightly managing our costs, reducing discretionary expenditure and reallocating resources across the group. We are further enhancing our data analytics and technology tools to rapidly respond to local consumer and customer shifts triggered by the pandemic. We have strengthened liquidity, giving us flexibility to continue to invest effectively in the business for the long term.

While the trajectory of the recovery is uncertain, with volatility expected to continue into fiscal 21, I am confident in our strategy, the resilience of our business and am very proud of the way our people have responded. We are well-positioned to emerge stronger.”