Diageo: Worst may be over from China

DIAGEO, the world’s biggest distiller, said sales declines in China moderated in the first quarter, helping to mask a steeper drop in total sales than analysts expected. Revenue in mainland China fell about 20 percent in the three months to September, the London-based maker of Johnnie Walker Scotch whisky said yesterday. It was an improvement on the previous year’s drop of about 50 percent. China has weighed on liquor producers as the country’s crackdown on lavish spending has led distributors to deplete inventory. Yesterday’s figures from Diageo indicated that the worst may be past, helping the shares gain the most in more than a year even though the firm gets less than 1 percent of sales from the country. The shares were up 0.6 percent at £17.19 (R302) at 9.15am in London yesterday after gaining as much as 3.5 percent, the steepest intraday advance since July last year. – Bloomberg