Guinness maker Diageo takes hit after big drop in China demand
GUINNESS maker is the latest drinks firm to take a hit in China after the company said this market was the main driver of a weakness across its emerging markets performance.
The company, which also reported a drop in Irish sales, said net profit was down to £2.25bn for the year ended June, compared with £2.45bn a year earlier.
Revenues came in at £13.9bn, or 8.5pc down.
"Emerging market weakness, often currency related, but also including some specific issues, such as the anti-extravagance measures in China, has led to weaker top line growth," said Chief Executive Ivan Menezes.
Just two years ago, the Chinese government banned big gift sharing and scaled back on state-funded banquets.
Following a significant increase in excise duties in the first half of the year, the market in Ireland remained challenging and net sales declined 4pc, the company said.
It added that spirits were impacted and net sales were down double digit.