Diageo hikes dividend despite fall in profits

Drinks giant Diageo today said shareholders were in line for a 9 per cent rise in their dividend payout despite reporting fall in first-half profits.

The maker of Johnnie Walker whisky, Guinness stout and Smirnoff vodka said investors will receive an interim dividend of 21.5p a share on 7 April, up from 19.7p a year ago.

That comes despite operating profits for the six months to the end of December falling 18 per cent to £1.7 billion. Net sales dipped 1 per cent to £5.9bn.

However, chief executive Ivan Menezes said the group’s sales performance had improved as the first half progressed, with organic net sales rising by 0.7 per cent in the second quarter, compared with a 1.5 per cent decline in the first three months of its financial year.

He added: “We have already taken action to improve the performance of those brands and markets that have not performed as well as we would expect. This contributed to our stronger second-quarter performance and I expect to maintain this momentum through the year.”