Drinks giant Diageo hails ‘gin-aissance’ as global sales jump

The “gin-aissance” gin-drinking boom is spreading around the world and boosting sales at the world’s biggest drinks company Diageo, the firm said on Thursday.

The maker of Gordon’s and Tanqueray saw strong double-digit growth in both brands, its annual results showed. The spirit represents 4% of Diageo’s sales but sales of it soared 22% overall in the year to June, with stellar growth across all areas except North America.

Chief financial officer Kathryn Mikells said: “Europe has had a ‘gin-aissance’ for the last three or four years, but the other point is that gin is getting hot in a number of other countries — it’s getting very hot in Brazil, it’s getting very hot in Australia, it’s getting very hot in South Africa. We continue to feel good about gin.”

In the UK, where Gordon’s drove sales of pre-mixed drinks up 17%, sales rose 4% with market share gains in both beers and spirits. The Guinness maker also gained from its first year as the headline sponsor of rugby’s Six Nations competition.

The spirits giant also hailed strong growth for Johnnie Walker, which saw sales rise by 7%, although in Europe scotch sales were largely flat as this was offset by weaker sales of J&B.

Earlier this week talks between Diageo and its Scottish union workers fell apart, increasing the likelihood of strikes at its whisky sites.

Members of the Unite and GMB unions, who make up more than half of Diageo’s 3,500 Scottish workforce, will ballot workers over strike action after rejecting an “insulting” offer of a 2.8% pay rise.

Mikells said the firm holds itself as a “very good employer” and is committed to coming to agreement with frustrated employees.

Diageo, whose other leading brands include Smirnoff vodka, saw operating profit rose 10% to £4 billion for the year, with organic sales up 6.1% to £12.9 billion.

The firm also announced plans to return £4.5 billion to shareholders by 2022, building on a previous £3 billion programme.