Drinks giant Diageo reported organic net sales growth of 1.7% for fiscal 2025, with gains evenly split between volume (0.9%) and price/mix (0.8%). Reported net sales slipped 0.1% to $20.2 billion, weighed down by currency headwinds and portfolio changes.

The company grew or held market share in 65% of measured markets, including the U.S., with standout performances from Don Julio, Guinness, and Crown Royal Blackberry. However, reported operating profit fell 27.8% due to impairment and restructuring costs, currency impacts, and higher overhead investment. Organic operating profit dipped 0.7%.

Free cash flow rose to $2.7 billion, while net debt stood at $21.9 billion, giving a leverage ratio of 3.4x. Diageo recommended a full-year dividend of 103.48 cents.

Nik Jhangiani, Interim Chief Executive commented: “I am pleased to report on our fiscal 25 results which in a challenging year, were in line with our guidance. 

“We delivered 1.7% organic net sales growth reflecting the strength of our portfolio and our diversified footprint. While we are encouraged by areas of progress and the standout performance from Don Julio, Guinness and Crown Royal Blackberry, there is clearly much more to do across our broader portfolio and brands. 

“We recognise the need to drive meaningful growth opportunities in an evolving TBA landscape, and we are sharpening our strategy to accelerate growth.

“Our Accelerate programme is progressing well and is central to creating a more agile operating model. As such, I am pleased to announce that we are increasing our cost savings target by c.$125 million, to c.$625 million over the next three years. We are also committed to strengthening our balance sheet and expect to deliver c.$3 billion free cash flow in fiscal 26, increasing financial flexibility whilst continuing to invest for longer term growth.

“While macroeconomic uncertainty and the resulting pressure on consumers continues to weigh on the spirits sector, we believe in the attractive long-term fundamentals of our industry and in our ability to continue to outperform as the TBA landscape evolves. 

“We are focused on what we can manage and control and executing at pace. The board and management are committed to delivering improved financial performance and stronger shareholder returns on a sustained basis.