To: chowder who wrote (23632 ) 12/17/2025 4:07:38 PM From: Fireball Dividend 1 RecommendationRecommended By
Respond to DEO guidance for FY2026 ending June. Revised Financial Outlook for Fiscal 2026 Organic Net Sales Growth: Now expected to be flat to slightly down . This is a downgrade from prior guidance that anticipated growth similar to fiscal 2025 (+1.7%).Organic Operating Profit Growth: Forecasted in the low to mid-single digit range .Free Cash Flow: Committed to delivering approximately $3 billion .Capital Expenditure: Expected to be at the lower end of the $1.2–$1.3 billion range.Taxation: Anticipated tax rate before exceptional items is approximately 25% . Key Market Drivers and Headwinds U.S. Consumer Environment: Performance has been hampered by a "softer" consumer environment than originally planned.Chinese Market: Weaker demand for spirits, particularly in the "white spirits" (baijiu) category, has significantly impacted Asia Pacific results.Tariff Impacts: The company estimates a $200 million annualized pre-mitigation hit to operating profit from U.S. and European tariffs. Diageo expects to mitigate roughly half of this through operational actions.Internal Cost Savings: Profitability is supported by the "Accelerate" programme , which targets $625 million in cost savings over three years. Sustainability Targets Water Replenishment: Diageo remains on track to replenish 100% of the water it uses in water-stressed areas by 2026. Diageo Cuts Annual Sales Forecast Amid Weaker Demand in ... Sources for this informations: November 2025 .Primary Official Sources Fiscal 2026 Q1 Trading Statement (November 6, 2025): This is the definitive source for the revised 2026 outlook. It was issued by Diageo PLC and detailed the downgrade in sales and profit expectations due to market headwinds in China and the U.S..Q1 2026 Shareholder and Analyst Call (November 6–7, 2025): Transcripts from these events, led by Interim CEO Nik Jhangiani, provided context on the "Accelerate" program cost savings ($625 million) and revised Capital Expenditure targets ($1.2–$1.3 billion).Diageo Preliminary Results 2025 (August 5, 2025): Early guidance for fiscal 2026 was first introduced here, including the $3 billion free cash flow target and the initial tax rate estimate of 25% . Secondary and Media Sources Financial News Outlets: Reports from The Spirits Business , AJ Bell , and Hargreaves Lansdown summarized the November 2025 guidance cuts, highlighting the shift from "mid-single digit" to "low to mid-single digit" operating profit growth.Market Analysis Firms: Reports from Morningstar and Jefferies analyzed the impact of these guidance changes on Diageo’s fair value and confirmed the specific figures for organic net sales growth.Diageo "Distilled 2025" Global Report: Provided the underlying consumer trend data (such as "zebra striping" and moderation) that influenced the company's long-term strategic adjustments https://www.esmmagazine.com/retail/diageo-lowers-2026-forecast-as-us-china-demand-slows-299545 https://www.alphaspread.com/market-news/earnings/diageo-cuts-annual-sales-forecast-amid-weaker-demand-in-china-and-us https://www.thespiritsbusiness.com/2025/11/diageo-not-satisfied-with-q1-sales/
