UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
05 August 2025
Commission File Number: 001-10691
DIAGEO plc
(Translation
of registrant’s name into English)
16 Great Marlborough Street, London, United Kingdom, W1F 7HS
(Address
of principal executive offices)
Indicate
by check mark whether the registrant files or will file annual
reports under cover Form 20-F or Form 40-F.
Form
20-F X
Form
40-F
Preliminary results
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Year ended 30 June 2025
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5 August 2025
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Reported results
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Adjusted results(1)
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F25
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vs F24
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F25
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vs F24
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Net sales
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$20,245m
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(0.1)%
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Organic net sales movement
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$338m
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1.7%(2)
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Operating profit
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$4,335m
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(27.8)%
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Operating profit before exceptional
items
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$5,704m
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(0.7)%(2)
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Operating profit margin
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21.4%
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(819)bps
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Operating profit margin before exceptional
items
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28.2%
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(68)bps(2)
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Net profit
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$2,538m
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(39.1)%
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Basic earnings per share
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105.9c
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(38.9)%
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Basic earnings per share before exceptional
items
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164.2c
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(8.6)%
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Net cash flow from operating activities
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$4,297m
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$192m
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Free cash flow
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$2,748m
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$139m
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Organic net sales growth balanced between volume and
price/mix
●
Reported net sales of $20.2 billion declined 0.1% due to
unfavourable foreign exchange of (0.6)% and acquisition and
disposal adjustments of (1.1)%, partially offset by
hyperinflation adjustments and organic net sales
growth.
● Organic net sales growth of 1.7% was
driven by organic volume growth of 0.9% and positive price/mix of
0.8%. Excluding the impact of the Cîroc transaction,
organic net sales growth was 1.5%, with 0.8% volume growth and 0.7%
price/mix.(3)
● Diageo grew or held total market share in
65%(4) of
total net sales in measured markets, including in the
US.
Gross margin expansion more than offset by investment in overheads,
operating profit slightly down
●
Reported operating profit declined 27.8% and reported operating
profit margin declined 819bps, primarily due to exceptional
impairment and restructuring costs, unfavourable foreign exchange
and a decline in organic operating margin.
● Organic operating profit declined by 0.7%;
organic operating profit margin declined 68bps, mainly due to
continued investment in overheads, partly offset by slight gross
margin expansion. Excluding the impact of the Cîroc
transaction,(3) organic
operating profit declined 1.0%, in line with prior guidance,
and organic operating margin declined 70bps.
●
EPS pre-exceptionals was 164.2 cents, down 8.6%.
Increased cash flow, focus on reducing leverage through
Accelerate
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Net cash flow from operating activities increased by $0.2 billion
to $4.3 billion. Free cash flow increased by $0.1 billion to $2.7
billion.
● Net debt as at 30 June 2025 was $21.9
billion, with a leverage ratio of 3.4x net debt to adjusted
EBITDA,(5) in
line with the guidance range of 3.3-3.5x.
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Recommended full year dividend of 103.48 cents.
Accelerate on track with savings target increased; fiscal 26
outlook provided
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Firm focus on productivity, driving cash and growth. Cost savings
programme target increased to c.$625 million, up from c.$500
million.
●
In fiscal 26, expect organic sales growth to be similar to fiscal
25 and organic operating profit growth to be mid-single-digit,
including the impact of tariffs as at this time.
Nik Jhangiani, Interim Chief Executive commented:
I am pleased to report on our fiscal 25 results which in a
challenging year, were in line with our guidance. We delivered 1.7%
organic net sales growth reflecting the strength of our portfolio
and our diversified footprint. While we are encouraged by areas of
progress and the standout performance from Don Julio, Guinness and
Crown Royal Blackberry, there is clearly much more to do across our
broader portfolio and brands. We recognise the need to drive
meaningful growth opportunities in an evolving TBA landscape, and
we are sharpening our strategy to accelerate growth.
Our Accelerate programme is progressing well and is central to
creating a more agile operating model. As such, I am pleased to
announce that we are increasing our cost savings target by c.$125
million, to c.$625 million over the next three years. We are also
committed to strengthening our balance sheet and expect to deliver
c.$3 billion free cash flow in fiscal 26, increasing financial
flexibility whilst continuing to invest for longer term
growth.
While macroeconomic uncertainty and the resulting pressure on
consumers continues to weigh on the spirits sector, we believe in
the attractive long-term fundamentals of our industry and in our
ability to continue to outperform as the TBA landscape evolves. We
are focused on what we can manage and control and executing at
pace. The Board and management are committed to delivering improved
financial performance and stronger shareholder returns on a
sustained basis.
(1)
See pages 39-46 for an explanation and reconciliation of non-GAAP
measures.
(2)
Represents organic movement.
(3)
On 7 April 2025, Diageo entered into a strategic partnership with
Main Street Advisors. As part of the transaction, Diageo
transferred its majority ownership interest in Cîroc in
North America in exchange for interest in Lobos 1707 Tequila
globally. The transaction was completed in June 2025. As a result,
Cîroc in North America is no longer consolidated in the
group's financial statements and is now accounted for as an
investment in associate.
(4)
Internal estimates incorporating Nielsen, Association of Canadian
Distillers, Dichter & Neira, Frontline, INTAGE, IRI, ISCAM,
NABCA, State Monopolies, TRAC, IPSOS and other third-party
providers. All analysis of data has been applied with a tolerance
of +/- 3 bps and the descriptions applied of gaining, holding or
losing share by the Company or brands are based on estimated
performance within that tolerance. Percentages represent percent of
markets by total Diageo net sales contribution that have held or
gained total trade share in the fiscal year to date. Measured
markets indicate a market where we have purchased any market share
data. Market share data may include beer, wine, spirits or other
elements. Measured market net sales value sums to 89% of total
Diageo net sales value for the twelve months ended 30 June
2025.
(5)
Leverage ratio calculated using adjusted net debt which is the
equivalent to adjusted net borrowings (net borrowings plus
post-employment benefit liabilities before tax).
See
pages 39-46 for an explanation and reconciliation of non-GAAP
measures, including organic net sales, organic marketing
investment, organic operating profit, free cash flow, EPS before
exceptional items, adjusted net debt, adjusted EBITDA and tax rate
before exceptional items. Unless otherwise stated, movements in
results are for the year ended 30 June 2025 compared to the
year ended 30 June 2024.
Outlook
Outlook for fiscal 26
Organic net sales growth expected
to be at a similar level to fiscal 25 given a continued challenging
market. Growth will be more weighted to the second half, with
organic net sales down slightly in the first
half.
Organic operating profit growth expected
to be mid-single-digit, skewed to the second half, and will be
supported by cost savings from the Accelerate programme. This also
includes the impact of tariffs as at this time.
Taxation -
we expect the tax rate before exceptional items for fiscal 26 to be
c.25% (fiscal 25: 24.9%).
Effective interest rate -
we expect the effective interest rate for fiscal 26 to be c.4.0%
(fiscal 25: 4.1%).
Capital expenditure in
fiscal 26 is expected to be lower than the spend in fiscal 25 and
in the range of $1.2 - $1.3 billion (fiscal 25: $1.5
billion).
Free cash flow expected
to be c.$3 billion (fiscal 25: $2.7 billion). This includes
exceptional cash costs related to the Accelerate
programme.
Strategy update - at
a glance
In May 2025, we launched the Accelerate programme to strengthen
Diageo's foundations for long-term, sustainable growth. Phase one
is progressing well, with good momentum across markets. The
programme sets out clear cash delivery targets and a disciplined
approach to operational excellence and cost efficiency. It will
also shift how we operate: creating a more agile and efficient
business, enabling us to optimise investment and allocate resources
more effectively. Collectively, we expect this to deliver better
growth.
Through our prioritisation tools and enhancing our data-driven
frameworks, we are focused on accelerating growth by directing
investment to higher growth opportunities. Don Julio delivered
double-digit growth in all regions and gained share in measured
markets representing >90% of net sales, Guinness delivered
double-digit growth, and gained share in its three largest markets,
while Guinness Microdraught opened new global
distribution opportunities. In whisky, Johnnie Walker gained
share of international whisky and scotch; with innovation
importantly supporting recruitment.
Optimising A&P spend remains a key focus, with more targeted
investment and greater efficiency across our marketing operations.
This is well underway and a key priority for the coming year. In
fiscal 2025, we reduced development costs (non-working) to 14% of
A&P spend, down from 21% in fiscal 2024, leveraging our
AI-driven content production and agile ways of workings across our
marketing function, including Agile Brand Communities, and
Conscious Create Teams.
Moderation is a significant growth opportunity for Diageo,
particularly in an evolving TBA landscape. This is supported by our
leadership in non-alcoholic spirits, more than four times the size
of our nearest competitor.(1) In
fiscal 2025, our non-alc portfolio organic net sales grew c.40%. We
extended our non-alc leadership with the acquisition of Ritual
Beverage Company LLC in the US. Guinness 0.0 delivered double-digit
growth. RTDs can also play a key role in moderation - offering
convenience and often lower ABV options. We initiated a more
targeted strategy for RTDs in selective key RTD markets, with some
encouraging early signs.
In the US, our spirits route-to-market has benefited from increased
investment in capability building, commercial execution and
investing in key accounts, and we are seeing early signs of
incremental growth. We continue to optimise our supply chain, with
a new manufacturing and warehouse facility announced in Montgomery,
Alabama, to increase efficiency and sustainability. Additionally,
in Europe, we introduced a new strategy and operating model under
Accelerate, including targeted investments and more standalone
markets. Across Diageo, we are embedding a more performance-driven
culture, focused on speed, agility, continuous improvement, and
leadership accountability.
(1)
RSV IWSR 2024
Dividend
The recommended final dividend for the year ended 30 June 2025, to
be proposed to shareholders for approval at the Annual General
Meeting to be held on 6 November 2025 is 62.98 cents per share.
This will bring the recommended full year dividend to 103.48 cents
per share. Subject to approval by shareholders, the final dividend
will be per share paid to holders of ordinary shares and US ADRs on
the register as at 17 October 2025. The ex-dividend date is 16
October 2025 for holders of ordinary shares, and 17 October 2025
for holders of US ADRs. The final dividend, once approved by
shareholders, will be paid to holders of ordinary shares and US
ADRs on 4 December 2025. Holders of ordinary shares will receive
their dividends in sterling unless they elect to receive their
dividends in US dollars by 7 November 2025. The dividend per share
in pence to be paid to ordinary shareholders will be announced on
20 November 2025 and will be determined by the actual foreign
exchange rates achieved by Diageo buying forward contracts for
sterling currency, entered into during the three days preceding the
sterling equivalent announcement of the interim dividend. A
dividend reinvestment plan is available to holders of ordinary
shares in respect of the final dividend and the plan notice date is
7 November 2025.
To view the final results document in full, please paste the
following URL into the address bar of your
browser:
http://www.rns-pdf.londonstockexchange.com/rns/9305T_1-2025-8-4.pdf
In accordance with DTR 6.3.5(1A), the final results document has
been submitted to the National Storage Mechanism in full unedited
text and will shortly be available for inspection at:
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
Presentation for analysts and
shareholders
Pre-recorded audio webcast and presentation
slides
At 07:05 (UK time) on Tuesday 5 August 2025, Nik Jhangiani, Interim
Chief Executive and Sonya Ghobrial, Global Head of Investor
Relations, will present Diageo's preliminary results as a
pre-recorded audio webcast. This will be available to view at
https://www.diageo.com/en/investors/results-reports-and-events/2025-preliminary-results.
The presentation slides and script will also be available to
download.
Live Q&A conference call
Nik Jhangiani and Sonya Ghobrial will be hosting a Q&A
conference call on Tuesday 5 August 2025 at 09:30 (UK
time).
For analysts and shareholders wishing to ask questions, please use
the dial-in details below which will have a Q&A
facility.
Please dial in 15 minutes ahead of the scheduled start time to
register before the call begins.
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From the UK:
From the UK (free call):
From the USA:
From the USA (free call):
Passcode:
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+44 (0)20 3936 2999
0808 189 0158
+1 646 233 4753
+1 855 979 6654
341561
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Transcript and audio recording
Following the Q&A conference call, a transcript and audio
recording will be available from the link below:
https://www.diageo.com/en/investors/results-reports-and-events/2025-preliminary-results
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Calendar for future events
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6 November 2025
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Q1 F26 Trading update and AGM
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25 February 2026
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Interim results for six months ending 31 December
2025
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May 2026
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Q3 F26 Trading Update
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August 2026
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Preliminary results for year ending
30 June 2026
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Enquiries
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Investors:
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Sonya Ghobrial +44 (0)7392 784784
Andy Ryan +44 (0)7803 854842
Grace Murphy +44 (0)7514 726167
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Media:
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Brendan O'Grady +44 (0)7812 183750
Rebecca Perry +44 (0)7590 809101
Clare Cavana +44 (0)7751 742072
Isabel Batchelor +44 (0)7731 988857
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Diageo plc LEI:
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213800ZVIELEA55JMJ32
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About Diageo
Diageo is a global leader in beverage alcohol with an outstanding
collection of brands across spirits and beer categories. These
brands include Johnnie Walker, Crown Royal, J&B and
Buchanan's whiskies, Smirnoff, Ketel One, Captain Morgan, Baileys,
Don Julio, Tanqueray and Guinness.
Diageo is a global company, and our products are sold in nearly 180
countries around the world. The company is listed on both the
London Stock Exchange (DGE) and the New York Stock Exchange
(DEO). For more information about Diageo, our people, our brands,
and performance, visit us at www.diageo.com. Visit Diageo's
global responsible drinking resource, www.DRINKiQ.com for
information, initiatives, and ways to share best
practice.
Celebrating life, every day, everywhere
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
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Diageo plc
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(Registrant)
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Date:
05 August 2025
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By:___/s/
James Edmunds
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James Edmunds
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EXHIBIT INDEX
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EXHIBIT NUMBER
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EXHIBIT
DESCRIPTION
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99.1
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