Diageo boosts revenue in Russia by 6% in H1 of FY2017 due to rise in prices
MOSCOW. Jan 27 (Interfax) - Britain's Diageo, the largest producer of alcoholic beverages in the world, cut sales in Russia by volume by 7% in H1 of the 2017 fiscal year, which ended on December 31.
Net revenue rose by 6% due to a rise in prices. The reason for the rise in prices for the products was the need to offset losses from the depreciation of the national currency, the company said in the statement.
"The high volatility of the external economic environment, the market in general and also last year's effect from the devaluation of the ruble continue to impact the Russian consumer goods market and the retail sector," Diageo in Russia Managing Director Svetlana Naumova was cited as saying in the statement.
She said that the company is continuing to hold leadership positions on the Russian whisky market. "Russian consumers often prefer our brands for Scottish whisky, which is clear from the stable, good results for the Bell's brand and the upward trend for the Johnie Walker brand," Naumova said.
Super deluxe brands continued double-digit growth, which led to an increase in gross margin in Russia.
"For now, the economic situation remains difficult, we are setting clear priorities for further investments, focusing on proven growth factors and continuing to work on increasing the business's productivity," Naumova said.
The global sales of Diageo for H1 fell by 1% to 129.4 million nine-liter cases. Organic (without the acquisition and sale of assets) sales rose by 2%.
The company's net revenue rose 15% to 6.4 billion pounds sterling. Organic sales growth (without account of acquisitions and sales, and also fluctuations in exchange rates) amounted to 4.4%.