Gordon's Gin; Diageo; gin sales

Gin fever leads growth for Diageo Australia

July 25, 2019
By Alana House

Booming gin sales and Game of Thrones whiskies have helped Diageo boost net sales this year to £12.8 billion, with organic growth up 5.8%.

In Asia-Pacific, growth was at 9%, with strong profits in Australia fuelled by 32% growth in the overall gin sales category.

Diageo Australia MD David Smith told the Australian Financial Review the company’s investment in brand-building and new products was paying off.

“Gordon’s Gin had delivered an extra $12 million in retail sales in the 12 months ended June 30, and had been growing at 25%, compared with overall growth in bottled spirits across the market of around 6%,” the AFR noted.

Globally, net sales were up 22% with Gordon’s and Tanqueray delivering double-digit growth for gin sales.

It follows IWSR’s Top 100 revealing Gordon’s was 2019’s fastest-growing spirits brand.

Tanqueray gin and tonic; Diageo

The company noted it was now bringing Tanqueray into the pre-mix market, launching two super-premium Tanqueray pre-mixed offerings in Australia – including Tanqueray & Tonic – and recently in Great Britain.

Smith said the RTD category had been growing by about 2.5% after many years of going backwards or sideways. He attributed much of the success to premiumisation of the category.

“I think the lower end of the market is battling a bit,” he said.

Diageo Australia generated sales growth of around 5% in 2018-19, but profit growth had been at a higher level and was ”approaching 10 per cent” according to Smith.

Game of Thrones whisky; Diageo; Johnnie Walker White Walker

Tapping into popular culture also paid off for Diageo, particularly the collaboration between Johnnie Walker and Game of Thrones.   

“We did really well out of it,” Smith said.

Overall, the collaboration helped boost scotch, which accounts for a quarter of the company’s net sales, by 6%.

CEO Ivan Menezes told investors he predicts the group will “maintain organic net sales growth in the mid-single digit range and to grow organic operating profit ahead of net sales in the range of 5%-7%.”

Share the content