Diageo Northern Ireland Does Not Expect Its Alcohol Sales In Pubs To Return To 2019 Levels Until 2022 At Earliest
Diageo Northern Ireland does not expect its alcohol sales in pubs to return to 2019 levels until 2022 at the earliest.
According to The Irish Times, accounts for Diageo Northern Ireland Limited state that in the group's "severe but plausible" scenario, it does "not anticipate that the on-trade business recovers to volumes experienced in the year ending 30th June, 2020, within the next 18-month period".
Directors reportedly said in a commentary that accompanied the accounts that management could take several measures to mitigate the fallout from the COVID-19 pandemic, including reducing non-essential overheads.
Marketing Expenses And Turnover
The accounts reportedly reveal that during the 12 month period that ended on June 30, 2020, the group reduced its marketing expenses by close to 36% to £3.75 million, and profits decreased by over 23% from £3.4 million to £2.6 million.
During what was reportedly described as an "unfavourable financial year" due to the COVID-19 pandemic, the company's turnover reportedly decreased to £134 million from £144 million the previous year, which the directors reportedly attributed to a decrease in beer and spirits sales volumes during the 12 month period.
However, the accounts noted that turnover for marketing and selling spirits increased by 5.4% to £41 million, but the marketing and selling of beer decreased by 11.6% to £92 million.
The directors reportedly noted that the impact that the COVID-19 pandemic will have over the next one to three years is "highly uncertain", and stated, "Significant volatility is likely to continue or increase as markets face challenging economic conditions and higher levels of unemployment, leading to reduced consumer spending."
However, the directors reportedly stated that they have "no reason to believe that a material uncertainty exists that may cast significant doubt about the ability of the company to continue as a going concern".
The business reportedly paid £64 million in excise duties during the year and recorded its cost of sales as being £52 million, which was a 7% decrease on the previous year.
Additionally, the number of people employed by the Guinness manufactuer's business in Northern Ireland was reportedly steady at 118; wages and salaries were cut by close to 15% to £4.1 million; and the company reportedly transferred £2.69 million to its reserves at the end of the year while no dividend was paid to the company’s parent, which compares to a £1.4 million dividend payment the previous year.
Diageo Northern Ireland Limited is controlled by Diageo plc.
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