Diageo reported flat organic sales for its first quarter and cut its full-year outlook, citing weak demand in the U.S. and for its Chinese white spirits.
The maker of Johnnie Walker whisky and Guinness stout said on Thursday that organic net sales were unchanged for the three months ended Sept. 30, while reported net sales fell 2.2% to $4.9 billion.
The company attributed the performance to a softer-than-expected consumer environment in North America, where organic sales fell 2.7%, and a sharp decline in its Chinese spirits business, which it estimated reduced group net sales by about 2.5%.
Growth in Europe, Latin America and Africa was offset by the weakness in its two largest regions, North America and Asia Pacific.
"We are not satisfied with our current performance and are focused on what we can manage and control; acting with speed to drive efficiencies, prioritising investment and adapting more quickly to an evolving consumer environment," Interim Chief Executive Nik Jhangiani said in a statement.
The results come as Jhangiani, the company's former finance chief, leads Diageo on an interim basis following the departure of its previous CEO earlier in the year amid slumping profits.
For its full fiscal year, Diageo now expects organic net sales to be flat to slightly down.
The company said it expects organic operating profit to grow by a low to mid-single-digit percentage, supported by a cost-savings program.
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