British drinks group Diageo posted a rise in first-half sales of its key spirits today and said it expected a similar picture in the second half, despite uneven economic recovery in Europe.
The maker of Smirnoff vodka, Johnnie Walker scotch and Guinness beer said profit before tax and exceptionals rose 2 per cent to €1.97 billion in the six months to December 31st, as a recovery in its North American markets was clouded by higher pension costs and a weak US dollar.
Net sales of premium drinks such as Captain Morgan rum and Cuervo tequila rose 6 per cent, excluding acquisitions.
"The trends that we have seen in the first half are expected to continue despite the uneven recovery in Europe, although the current exchange rate volatility will impact reported results," chief executive Mr Paul Walsh.
Drinks groups across the world are benefiting as consumers regain the taste for premium brands in the US-led economic recovery.
Shares in Diageo, which have performed in line with the DJ Stoxx food and beverage index over the past year, closed at 710 pence yesterday, valuing the company at about €32.3 billion.
Diageo's closest rival, Allied Domecq, said in January strong demand in North America was offsetting the impact of a weaker dollar, while world Number three spirits group Pernod Ricard raised its 2003 profit forecast earlier this month.