Slide 1: Preliminary Results Year Ended 30 June 2014
PRELIMINARY RESULTS YEAR ENDED 30 JUNE 2014
Slide 2: Efficient growth in a tougher environment
Efficient growth in North America growth and stability in Western Europe a tougher compensated for emerging market weaknesses environment Share gains despite top line pressure 2.7ppts positive price/mix offset volume decline Strong reserve growth – net sales up 14% Innovation drove incremental sales
Slide 3: Our long term performance ambition
Our long term performance ambition is: To create one of the best performing, most trusted and respected consumer products companies in the world Confidential
Slide 4: Our strategy remains unchanged
Our strategy DIAGEO’S STRATEGY AIMS TO DELIVER remains OUR PERFORMANCE AMBITION THROUGH: unchanged Prioritised investment in: Targeted investment in: Premium core Reserve Other Beer Wine spirits* spirits* *Spirits include ready to drink (RTDs) Confidential
Slide 5: A strong business in an attractive sector
A strong business The number of consumers who can afford our brands in an attractive is a sustained growth driver sector 8% 17% 36% Population by income 72% 43% group 81% $20K+ $5-20 56% 40% >$5k 24% 17% 4% 3% 2012 2020 F 2012 2020 F Developed Emerging Confidential
Slide 6: Diageo is well positioned to capture this increase in demand
Diageo is well Forecast spirits category growth 2012-17 (£bn) positioned to £bn 4 capture this increase in Competitors demand 3 Diageo 2 1 0 Scotch Vodka Cognac Indian Rum* Liqueur NAM Tequila Gin Irish whisky* whiskey whiskey Source: IWSR, Plato Logic. Group Strategy analysis. Excludes CWS. *Includ
Slide 7: In F14 we took action to manage the challenges we faced
In F14 we took Reduced stock levels in South East Asia and West LAC to action to manage improve visibility the challenges we faced Repositioned price points in Nigeria, up-weighted advertising and focussed on route to consumer Innovated in baijiu to broaden portfolio across price points Restated FX
Slide 8: North America continues to deliver
North America, our biggest and most Further top line growth and margin expansion profitable region, continues to Premium Core brands impacted by slower growth deliver of spirits market Strong growth from our reserve portfolio Strength in innovation Confidential
Slide 9: Western Europe saw stronger performance and improved trends
Western Europe saw stronger Remains challenging but has stabilised performance and improved Targeted marketing delivering share gains trends Reserve and innovation driving growth Strengthening our route to consumer Confidential
Slide 10: Africa, Eastern Europe and Turkey has posted modest growth
Africa, Eastern Europe and Turkey Share gains across a number of markets has posted modest growth Strong performance in some markets offset by weakness in others Continued strong reserve growth Innovation to meet key consumer trends Confidential
Slide 11: Performance in Latin America was strong overall
Performance in Latin America was Good performance despite mixed economic conditions strong overall with share gains and an Multi-category growth with some challenges in scotch expanded portfolio Reserve continued strong growth Very strong innovation performance Confidential
Slide 12: Asia Pacific top line performance was challenged
Asia Pacific top line Top line decline impacted by performance in China and South performance was East Asia challenged Scotch and baijiu were particularly impacted Continued strong performance in reserve Innovation focused on super and ultra premium Confidential
Slide 13: United Spirits transforms Diageo's platform in India
United Spirits transforms Acquired controlling stake in India’s leading spirits producer Diageo’s platform and world’s largest by volume in India Access to Indian spirits category and nationwide distribution Indian consumer fundamentals are strong – young, growing population; long-term GDP; large wh
Slide 14: Our six performance drivers
Our six performance Strengthen and accelerate Win in Reserve drivers are our premium core brands in every market improving focus across the business Innovate at Build and then continually scale to meet extend our advantage in new consumer route to consumer needs Drive out Ensure we have the talent t
Slide 15: Strong reserve performance with extended leadership position
Strong reserve Market share (value) – super deluxe spirits category performance with 13.1% extended leadership 11.1% 10.6% 2011 position 2012 9.2% 9.1% 2013 8.9% 8.9% 8.4% 7.9% 5.7% 5.2% 4.7% 4.8% 4.4% 4.2% 3.7% 3.1% 2.7% Diageo Pernod Ricard LVMH Bacardi Remy Patron Cointreau Source: IWSR value sha
Slide 16: Capturing incremental growth through an advantaged route to consumer
Capturing incremental Our brands in Global toolkit growth through more to drive rate of sale an advantaged route to places consumer More brands through innovation and investment in talent and capability are key enablers Growing sales and gaining share Confidential
Slide 17: The year ahead
The year ahead Top line improvement Emerging market volatility is moderating Western Europe stabilised - right strategy and structure in place to capture growth North America will continue to grow Continued share gains and growth in reserve Expect decline in baijiu to stabilise Confidential
Slide 18: A stronger business in a tough environment
A stronger business in a In F14 we set out how we would deliver change tough Our strategy is unchanged and we are building on a position of environment strength Our goals are clear and we have the platform and clarity across the business of what we need to do We start F15 with a more agile organisat
Slide 19: Q&A
DIAGEO Q&A
Slide 20: Cautionary statement concerning forward-looking statements
Cautionary statement concerning forward-looking statements This presentation contains ‘forward-looking’ statements. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. In particular, forward-looking statements include all statem