LONDON (ShareCast) - (Sharecast News) - Diageo has restarted its £4.5bn plan to return capital to shareholders after the drinks maker's business continued to recover in the second half of its financial year.
The drinks maker said trading picked up across all regions since the end of December and it expected organic operating growth of at least 14% in the year to the end of June. Cash generation is strong, it said in a trading update.

Performance in North America was particularly strong, reflecting resilient demand and good marketing, Diageo said. Strong off-trade sales and the partial reopening of on-trade outlets in some markets supported trading in Europe and most other markets recovered despite the continuing impact of the pandemic. Travel retail is still severely affected by the pandemic.

The maker of Guinness stout and Johnnie Walker whisky bought back £1.25bn of shares in the first phase of its capital return plan but suspended the programme in April 2020 because of Covid-19. The FTSE 100 group said it would return £1bn to shareholders by the end of the next financial year and aims to complete the plan by June 2024.

Ivan Menezes, Diageo's chief executive, said: "I am very pleased with how our business is recovering in fiscal 21, our strong competitive performance across key markets and our robust cash generation.

"When we have excess cash, we have been clear that we will seek to return it to shareholders. The board's decision to resume our return of capital programme at this time reflects Diageo's improved performance in the first half of fiscal 21 [and] the continued strong recovery of our business."

Email this article to a friend

or share it with one of these popular networks:

• DIGG
• FACEBOOK
• STUMBLEUPON
• MIXX
• YAHOO BUZZ
• DELICIOUS
• REDDIT
• NEWSVINE