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Diageo price rises offset weaker Europe

Thursday, January 31, 2013 - 01:36

Jan. 31 - Diageo, the world's biggest spirits group, reported steady sales growth in the second half of 2012, driven by price rises and the growth in the United States of premium brands like Ketel One vodka and Bulleit Bourbon. Hayley Platt reports.

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Drinks maker Diageo celebrates another six months of steady growth after raising the prices on some of its premium brands and strong demand in the US. The world's biggest spirits group reported a 5 percent rise in sales to nine and a half billion dollars in the half year to December. But its performance in crisis-hit southern Europe was less impressive, falling 19 percent. Paul Walsh is Diageo's CEO. SOUNDBITE: Paul Walsh, CEO, Diageo, saying (English): "Southern Europe a few years ago would have been north of 10 percent of our business it's now round about 5 percent. We have to play the hand that we've got. Our brands are healthy but he consumer is not spending." Things weren't as bad in eastern Europe - sales there were down just 2 percent. The group is now eying new markets in Africa, Asia and Latin America. It's hoping to tap into the growing middle classes. Diageo is now pouring 1 billion pounds in a new Scottish distillery to help it do so. SOUNDBITE: Paul Walsh, CEO, Diageo, saying (English): "Scotch is worth about £135 a second in export revenues to the UK. We have approaching a 50 percent market share. Johnnie Walker is the most successful scotch brand in the world and we grew it 14 percent in the half year we just reported." But the group has had some disappointments too. It recently called time on talks to buy a stake in the world's top-selling tequila brand Jose Cuervo. And its bid to buy India's United Spirits has been delayed.

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Diageo price rises offset weaker Europe

Thursday, January 31, 2013 - 01:36

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