Diageo plc (DEO)

Diageo said on 20 October 2026 it is “sincerely sorry” for a May pollution incident, when a chemical thought to be caustic soda entered Knockando burn, a tributary of the River Spey 9. The Scottish Environment Protection Agency's investigation is still open 910.

Reuters reported on 19 October 2026 that Indian tax officials are investigating whether Diageo and Pernod Ricard wrongly classified some bulk Scotch imports to pay lower tariffs 8. Diageo said it is cooperating with Indian authorities and has always complied with local laws 8.

On 13 October 2026 the company repeated its guidance for fiscal 27: broadly flat organic net sales and organic operating profit up low to mid single digit 5. Organic means leaving out currency moves and deals 1. It also guided to free cash flow of about $2 billion 5.

That follows the year to 30 June 2026, when net sales fell 3.0 percent to $19.6 billion and operating profit fell 27.2 percent to $3,156 million after restructuring and impairment charges 1. The annual meeting is on 5 November 2026 4.

Kenya's competition authority approved the sale of Diageo's East African Breweries stake to Asahi on 11 September 2026, and Diageo says completion is on track for the second half of calendar 2026 71.

Diageo's roots lie in Arthur Guinness Son and Company Limited, incorporated on 21 October 1886 1. The present group was formed in December 1997 by the merger of Grand Metropolitan and Guinness plc 1.

In the year to 30 June 2024 Diageo earned operating profit of $6,001 million on net sales of $20,269 million, and profit for the year was $4,166 million 1. Net sales are sales less excise duties, the alcohol taxes 1.

Debra Crew became chief executive in June 2023 after the sudden death of Ivan Menezes, who had led a period of extraordinary growth as drinkers splurged on spirits after the Covid-19 pandemic, Reuters reported 13. Reuters said she failed to win over investors as growth stalled in markets such as the UK and debt stayed elevated 13.

In the year to 30 June 2025 operating profit fell to $4,335 million as exceptional operating charges of $1,369 million replaced a gain of $56 million a year earlier 1. Impairments, which write down what a brand or asset is worth, included $231 million on Aviation American Gin and $51 million on the Bell's whisky brand 1.

In May 2025 the company announced its Accelerate restructuring programme, aimed at a more agile global operating model with cash delivery, cost savings and deleveraging targets 1. Crew resigned on 16 July 2025, and Nik Jhangiani became interim chief executive 1.

On 10 November 2025 Diageo named Dave Lewis, a former Tesco chief executive, to lead the company from the start of 2026, Reuters reported 13. The annual report records his appointment as 1 January 2026 1.

In his first results on 25 February 2026 Lewis cut the annual forecast and the interim dividend to 20 cents from 40.5 cents, Reuters reported 14. He set a dividend floor of 50 cents a year and named “pressurised consumer wallets” as the strongest drag on the category 14.

Reported net sales in Africa fell 10.5 percent in the year to 30 June 2026 because Diageo disposed of operations in Nigeria, Ghana and the Seychelles 1. In December 2025 it announced the sale of its East African Breweries stake to Asahi for $2.3 billion, which Reuters described as part of a strategy to exit the African market 7.

In March 2026 United Spirits, Diageo's Indian subsidiary, confirmed the sale of the Royal Challengers Bengaluru cricket team for about $1.78 billion 16. The buyers include the Aditya Birla Group, Times Group, Bolt Ventures and Blackstone's BXPE 16.

At the investor day on 6 August 2026 Lewis said the North American business had been “underperforming for quite a while” and that the growth of tequila “covered up some of that” 12. In the year to 30 June 2026 net sales in Greater China fell 34.9 percent as market policy changes hit Chinese white spirits 1.

The year to 30 June 2026 then brought impairments of $1.5 billion, largely in Türkiye after hyperinflation accounting and a change in pricing, plus restructuring charges of $0.9 billion 6.

The business in numbers

Diageo sells more than 200 brands in about 180 countries and territories, runs more than 110 manufacturing sites and has more than 27,500 employees 1. It says it is number one in international spirits by retail sales value and 1.8 times larger than its nearest international spirits competitor 1.

By category of reported net sales, Scotch is 24 percent, beer 18, tequila 12, vodka 8, Canadian whisky 6, rum 5, liqueurs 5, gin 4 and ready-to-drink 4 1. By region, North America is 37 percent, Europe 26, Asia Pacific 17, Latin America and Caribbean 11 and Africa 8 1.

Net sales in the year to 30 June 2026 were $7,249 million in North America and $5,097 million in Europe 1. Asia Pacific had $3,333 million, Latin America and Caribbean $2,160 million and Africa $1,642 million 1.

North America

North America, the largest region, saw net sales fall 9.1 percent as reported and 8.4 percent organically, driven mainly by US weakness 1. US Spirits net sales fell 11.5 percent on lower volume and softer prices and mix 1.

Tequila net sales fell 21.1 percent, with Don Julio down 19.2 percent and Casamigos down 27.7 percent, and both brands lost share 1. Crown Royal whisky fell 15.9 percent and Smirnoff vodka fell 5.0 percent 1.

Brighter spots were Ketel One vodka up 4.5 percent, Johnnie Walker up 1.0 percent, ready-to-drink and cocktails up 35.1 percent and Diageo Beer Company USA up 4.4 percent on Guinness and Smirnoff RTDs 1. Canada net sales rose 7.7 percent 1.

Europe

Europe net sales rose 5.7 percent as reported and 3.4 percent organically 1. Great Britain grew 2.9 percent on double-digit Guinness growth, and Guinness 0.0 is the fastest-growing and number one non-alcoholic beer there 1.

Türkiye net sales grew 25.5 percent on raki, Scotch and gin and on price rises made to offset inflation 1. Ireland grew 3.2 percent with Guinness gains 1.

Asia Pacific, Latin America and Africa

Asia Pacific organic net sales fell 6.3 percent, mainly because of Chinese white spirits 1. In Greater China, volume of those spirits fell 41.9 percent after market policy changes, while India grew 7.1 percent on Johnnie Walker and Black & White Scotch 1.

Latin America and Caribbean organic net sales grew 7.7 percent, led by Scotch and vodka 1. Africa grew 13.3 percent organically, with volume up 14.0 percent 1.

Plants, people and rivals

Diageo owns distilleries, breweries, packaging plants, maturation warehouses, cooperages and distribution warehouses, with major sites in the UK, Ireland, Türkiye, North America, Brazil, Mexico, East Africa, India, Australia and Greater China 1. The new Littleconnell brewery in County Kildare, Ireland, makes Guinness, and its €300 million expansion has been fully on stream since May 2026 1.

Sir Dave Lewis became chief executive on 1 January 2026, and John O'Keeffe now leads Diageo North America 1. Finance chief Nik Jhangiani is to be replaced by Joanne Wilson of WPP, who joins some time in 2027 3.

Europe has the largest workforce at an average of 10,345 people, followed by Asia Pacific with 8,028 1. In India, Diageo and France's Pernod Ricard dominate a $65 billion alcohol market, Reuters reported 8.

Current problems

Union members at the Cameronbridge distillery in Fife, which Food Manufacture calls Europe's largest grain distillery, began strikes on 28 September 2026 over proposed job cuts 11. Diageo said it proposes to remove up to ten roles there and expects no disruption to product availability 11.

A federal judge in Brooklyn dismissed a class action accusing Diageo of falsely labelling Casamigos and Don Julio as 100% agave, finding the buyers had not shown harm 15. The ruling was reported on 2 October 2026 15. Plaintiffs' lawyers said they may ask the court to reconsider 15.

Tariffs are a cost: organic operating margin rose 116 basis points on cost savings, partly offset by adverse mix and tariffs 1. A basis point is one hundredth of a percentage point 1.

The umbrella, in words

Diageo's own description names Johnnie Walker, Crown Royal, JeB and Buchanan's whiskies, Smirnoff and Ketel One vodkas, Captain Morgan, Baileys, Don Julio, Tanqueray and Guinness among its main brands 2.

The annual report's list of principal group companies shows Diageo owns 100 percent of Diageo North America, Diageo Ireland, Diageo Scotland, Diageo Great Britain and Mey İçki in Türkiye 1. It owns 55.88 percent of United Spirits Limited in India, a figure that excludes 2.38 percent owned by the USL Benefit Trust 1.

Diageo owns 34 percent of Moët Hennessy through two legal entities, an associate that is the wines and spirits division of LVMH 1. Under the partners agreement, LVMH may require Diageo to transfer those interests if a competitor acquires more than 34 percent of Diageo 1.

In the year to 30 June 2026 Diageo and LVMH ended distribution agreements for Diageo brands in Japan, Singapore and Thailand, a $75 million exceptional charge 1. That is an agreed contract change, not a stake 1.

Diageo owns 65 percent of East African Breweries and has agreed to dispose of it to Asahi for $2.3 billion, which Kenya's competition authority approved, Reuters reported on 11 September 2026 7. The cricket team sale was confirmed in March 2026 16.

Diageo invested in drinks start-ups through Distill Ventures and chose to exit several of those businesses, a $69 million cash cost in the year to 30 June 2026 1. The annual report lists no acreage, only its plant types by region 1.

Diageo says it is not directly or indirectly owned or controlled by another corporation or by any government, and its substantial shareholders do not have different voting rights 1. At 30 June 2026 it listed four notified interests of 3 percent or more 1.

BlackRock Investment Management (UK) had 5.89 percent, notified on 3 December 2009, and Artisan Partners 5.03 percent, notified on 17 April 2026 1. Capital Research and Management had 4.99 percent, notified on 28 April 2009, and Massachusetts Financial Services 4.99 percent, notified on 29 February 2024 1.

Separately, BlackRock Inc. reported 8.62 percent as of 25 January 2024 in an amendment to its Schedule 13G filed with the SEC 1.

For fiscal 27 the company expects broadly flat organic net sales, with North America down by a mid single digit if its market falls about 3 percent 5. It expects organic operating profit up low to mid single digit 5.

It also expects a tax rate of about 25 percent, an effective interest rate of about 4 percent and capital spending of about $1.25 billion 5. Free cash flow is guided to about $2 billion, against $3.2 billion a year earlier, after about $850 million of exceptional costs 5.

From fiscal 27 to fiscal 29 the company expects low single digit annual growth in net sales and mid single digit annual growth in organic operating profit 1. Excluding North America it expects net sales growth of 3 to 5 percent, and about $8 billion of cumulative free cash flow 1.

In North America the company expects share to stabilise from the second year and return to growth in fiscal 29 1. Drinks Intel reported that Lewis allocated $20 million to small-format packaging capacity there 12.

The company expects about $1 billion of savings over three years, $850 million from the new operating framework and $150 million from the supply chain 5. Restructuring costs were guided to about $1.2 billion in total 5.

It expects net debt of 2.5 to 3 times adjusted EBITDA, the range's midpoint, in fiscal 27 1. It expects about 2 times by the end of fiscal 29, assuming the East African Breweries and cricket team sales complete 1. The ratio was 3.1 times at 30 June 2026 1.

Shareholders vote on a recommended final dividend of 30 cents a share at the annual general meeting on 5 November 2026 6. If approved it is paid on 3 December 2026, with the pence amount announced on 19 November 2026 6.

In May 2026 Diageo announced about €400 million for a second Littleconnell brewery and roasting facility, with the new capacity due at the end of 2028 1. A new Guinness 0.0 plant there is expected on stream in early 2028 1.

Diageo says the East African Breweries sale remains on track to complete in the second half of calendar 2026 1. Scotland's environmental regulator said it would consider enforcement action once its investigation is complete 9.