Diageo 9-month Sales Down 7.4%, But Organic Sales Up 0.3% - Quick Facts

(RTTNews) - Drinks giant Diageo Plc (DGE.L, DEO) recorded a 0.3% growth in organic net sales for the nine months ended March 31, 2014. However, nine-month reported net sales slid by 7.4%, due to the adverse currency movements impact and the termination of the distribution deal with Jose Cuervo. For the third quarter, organic net sales were down by 1.3%.

Volume dropped by 2% in the nine-month period and by 1% in the third quarter.

Owing to the recent developments in Venezuela, such as the new currency exchange mechanism and the related reporting implications, Diageo has translated the Group's Venezuelan operations for the quarter and for the nine months at a rate of $1 = VEF49.81 (£1 = VEF83.18). Diageo said its organic net sales growth for the nine months and the recent quarter reflect this exchange rate.

The third quarter witnessed currency and economic weakness impact consumer confidence across many emerging markets, whilst consumer trends for the developed markets were in line with those in the first half.

Diageo's Chief Executive commented: "Our performance reflects the challenging environment we are operating in. Consumers in North America are most resilient, as are consumers of our reserve brands in most markets. In Western Europe the economy, consumer confidence and our business are all improving slowly but consistently. In the emerging markets currency volatility and caution about the outlook for GDP growth are negatively impacting business and consumer confidence."