Diageo’s 2025 preliminary results (year ended 30 June) show a 27.8% decline in reported operating profit. 

The company attributed this to exceptional impairment and restructuring costs, unfavourable foreign exchange and a decline in organic operating margin. 

At the same time, reported net sales of $20.2 billion declined 0.1% due to “unfavourable foreign exchange” and “acquisition and disposal adjustments,” said the company. 

By comparison, organic net sales growth – which does not include external factors such as mergers or acquisitions – increased by 1.7%. 

Diageo also grew or held total market share in 65% of total net sales in measured markets, including the US. 

The report showed that net cash flow increased by $0.2b to $4.3b. Meanwhile, free cash flow increased by $0.1b to $2.7b. 

Net debt was $21.9 billion, with a leverage ratio of 3.4x net debt adjusted to earnings before interest, taxes, depreciation and amortisation (EBITDA). This is in line with the guidance range. 

Looking forward to 2026, Diageo announced a focus on productivity, driving cash and growth. The target for the company’s cost-saving programme was increased to $625m, up from $500m. 

Considering the UK specifically, net sales grew by 3.5%, driven by double-digit organic net sales growth in Guinness. 

This was partially offset by poor net sales performance in spirits due to category weakness. 

The exception was tequila, which delivered strong category growth, particularly led by the Casamigos brand, founded by George Clooney. 

Following a period of decline for Diageo, net sales of RTDs in the UK were broadly flat thanks to several initiatives implemented to stabilise demand. 

Nick Jhangiana, who has stepped in as interim CEO after the sudden departure of Debra Crew, said: “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.”