Diageo's full-year results, due to be unveiled on Thursday, could be an ideal tonic for the stock market's nervousness. The London-based drinks giant has shown steady growth powered by some of the world's best-known alcohol brands, including Johnnie Walker, Smirnoff and Baileys Irish Cream. According to some sources, the sales of Johnnie Walker whisky in China are expected to show a 70 per cent rise year-on-year. The firm has also scotched rumours that it is planning to sell off Guinness.
How has it performed?
The City expects Diageo's full-year figures to be in line with company guidance that it will show organic growth of around 8 per cent in full- year earnings before interest and tax. The consensus is that pre-tax profits for the year to June 2007 will be £2.07bn, up from £1.99bn the previous year. Earnings per share of £0.55p are forecast.
While the City is not expecting any major surprises on Thursday, analysts are looking for growth in key markets, and the City will be focusing on guidance for the year to June 2008. Credit Suisse believes that opportunities outweigh threats in the current financial year.
The City is likely to grill Diageo on the sustainability of US pricing. But UBS believes it unlikely that the company will give detailed guidelines for 2008 given the importance of Thanksgiving and Christmas.Reuse content