Drinks group Diageo reported increased annual revenue and profit as a recovery in demand for spirits in the US and sales in emerging markets help offset tough European conditions.

Earnings before interest and tax, excluding some items, rose to £3.2 billion from £2.9 billion a year earlier. On a so-called organic basis, they increased 9 per cent, compared with an 8.6 per cent median estimate of 12 analysts surveyed by Bloomberg.

Diageo, which sells brands including Guinness and Smirnoff, is seeking to boost sales and profit by tapping growth in emerging markets and selling consumers more expensive variants of its brands. The company bought Brazilian cachaca brand Ypioca in May and got regulatory approval in March to buy a Chinese maker of white spirits.

Organic revenue, which excludes the effect of acquisitions, disposals and currency fluctuations, increased 6 per cent in the 12 months to June 30th, just short of analysts’ expectations for growth of 6.3 per cent. Total net sales rose 8 per cent to £10.8 billion on a reported basis.

Bloomberg