Diageo 1st Half Organic Sales Growth to Be Hit by Later Chinese New Year -- Update

By Ian Walker

Diageo PLC (DGE.LN) said Wednesday it expects first-half organic sales growth to be hit by the later timing of the Chinese New Year and the expected impact of a ban on selling alcohol along highways in India.

The drinks company, which houses Johnnie Walker, Crown Royal, J&B, Buchanan's and Smirnoff among its brands, also said it expects organic operating margin expansion to be weighted towards the second half of the year as it increases its investment in U.S. Spirits and Scotch whisky.

Still Diageo, which earlier this year added George Clooney's Casamigos tequila to its portfolio, said it is well set to perform in line with the board's expectations, and backed its three-year guidance.

Diageo has a target of mid-single digit top line growth and 175 basis points of organic operating margin improvement over the three years ending June 30, 2019.

Shares at 0700 GMT were down 35.50 pence, or 1.4%, at 2460.50 pence

Write to Ian Walker at ian.walker@wsj.com

(END) Dow Jones Newswires

September 20, 2017 03:30 ET (07:30 GMT)

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