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GUINNESS BREWER DIAGEO has reported a drop in its global sales despite a big take-up in its premium “reserve” brands.
The world’s biggest spirits group, which also owns beers Kilkenny and Smithwick’s, Bushmills whiskey and a string of other brands, suffered a 1.5% fall in sales from its existing operations worldwide over the past three months.
Its turnover in the Asia-Pacific region took the biggest hit, down 7.4%, while its sales in Europe fell 1.4%.
Diageo said its European performance suffered from low sales in Russia and eastern Europe because of the Ukraine crisis and a lack of consumer confidence there, in Germany and the Benelux (Belgium, Netherlands and Luxembourg) countries.
Sales in China plunged 20% over the three months as the company noted the “challenging trading environment” in the world’s second-biggest economy.
Premium drops doing well
The only positive notes were a slight increase in its North American business, which Diageo said had been experiencing strong growth in sales of spirits and wine, and a 10% lift in sales of its reserve brands.
Diageo chief executive Ivan Menezes said the company’s performance was in line with its expectations and it still forecast this financial year’s overall sales to be up on the 2013-14 figures.
The company last year turned a profit of £2.7 billion (€3.4 billion in today’s money) and it recently opened a €169 million expansion of a new brewhouse in its Guinness factory at St James’s Gate, Dublin.
SABMiller, the world’s second-biggest brewer, announced a 3% rise in worldwide revenues for the last three months on Tuesday despite it selling less drinks over the period.
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They will continue to suffer while all of the smaller breweries keep popping up and making a superior product. They need to either start buying them up or move towards making better beer. People sitting at home on a Friday night with a six pack will mostly go for craft beer now as opposed to the watery stuff we drank for years.
Spot on Barry. Although I hope they focus on their own offerings as oppose to buying the smaller craft brewers out.
Franciscan Wells doesn’t taste te same since they were bought out by Coors!
Guinness is no longer owned by Guinness but by diageo who have got rid of half the staff and treated them awfully
I have several family members in Guinness and they are definitely not treated appallingly.
Ill drink to that
Surely if you’re making billions in profit 1.5% isn’t a big deal?
Not that I’d wish to see people lose jobs, especially in Ireland, but I have little sympathy for Diageo.
I’ve seen them and their marketing up close and personal, and they way they try to ingratiate themselves with Irish identity and buy a good name for themselves by associating with charities. The absolute cynicism of Arthur’s Day and the complete disinterest they had in the public chaos it caused was what really turned me away from them and their products. It’s profit at all costs there, and then maybe try to have a fig leaf of corporate social responsibility, if it suits.
If they actually invested in their products instead of churning out low quality drinks like they do, then they wouldn’t be in this mess.
I run a pub in upstate NY and it will not be long before sales drop here in the states too. Overpriced and dropped sponsorship of all things Irish. They think they can coast on the brand name. Sad really.
Craft Beers, are on the way up, Erdinger, sweet Jesus it’s good….
The Dropping well…..
have your say