Shares in Diageo jumped on Wednesday morning as high hopes for a high-drama World Cup helped lift the drinks firm's sales back into positive territory. The Guinness and Johnnie Walker maker, which had been battling a slowdown in demand for spirits, reported a 2.3% increase in net sales to $4.5 billion (£3.3 billion) in the first three months of the year.
World Cup Boost
The company said it had seen "some benefit" from "advance sales" ahead of the start of the football tournament next month. Growth in Europe jumped 8.8% during the quarter, led by the Brits' unquenchable thirst for Guinness. However, this was offset by a 9.4% slump in sales in the US and Canada, amid double-digit declines in sales of tequila.
Challenges in North America
Chief Executive Dave Lewis acknowledged the difficulties, stating: "North America remains our biggest challenge, where market conditions are soft and our offer needs to be more competitive. Actions are already underway to address this."
Diageo shares rose 5.2% to 1,552p in early trade on Wednesday morning, though the stock remains down around 3% since the start of the year. The company's performance highlights the impact of major sporting events on consumer spending, with the World Cup providing a temporary lift to sales.
This story is being updated, more to follow.
