Was it coincidence that the newly-created Diageo drinks empire of Grand Met and Guinness chose St Patrick's Day to present its maiden annual results, a day of particularly high consumption of one of its best-known brand? Diageo, one of the daftest corporate names around, produced pre-tax profits nudging the £2 billion mark but the strength of sterling clipped £100 million off bottom line profits. Turnover eased nearly half a billion pounds to £12.3 billion, the sterling factor again in evidence.

Guinness Ireland again made a solid contribution to group earnings, with wider margins generating higher profits. Pre-tax profits grew 14 per cent to £186 million, despite a 5 per cent slowdown in turnover growth at £804 million. Gains on margins were attributed to lower costs, particularly in raw material prices. Beer consumption grew for the second year in a row, with Guinness volumes improving 4 per cent. Growth this year is expected to be above 3 per cent.

Mr Shaun Holiday, managing director of Guinness Ireland, said the group increased its share of the stout and lager market despite strong competition from rival brands. Canned draught Guinness was a star turn, with sales surging 63 per cent. Overall, lager sales grew 10 per cent, led by Budweiser and Carlsberg. Exports grew 11 per cent and now account for 43 per cent of output. World-wide sales of Bailey's continues to grow steadily, with volumes up 5 per cent to 4.2 million cases.

Diageo is making a maiden payment of 7.2p a share, accompanied by a one-off foreign income dividend of 5.3p a share.