Important points
Diageo chief executive Debra Crews has suggested that alcohol sales growth will return as the consumer environment improves. The company posted disappointing results last quarter due to the weak North American environment. Diageo’s U.S.-listed shares rose on Thursday, but remain down from the start of the year.
The company, which owns alcoholic beverage brands such as Guinness, Crown Royal and Johnnie Walker, saw its stock rise on Thursday on optimism that the difficult consumer spending environment could improve.
“Growth will return as the consumer environment improves and the steps we are taking will allow us to outperform the market,” Diageo CEO Debra Crews said in a statement Thursday. I will stand my ground.”
The British company’s American Depositary Receipts (ADRs) fell sharply in July following disappointing quarterly results, which it blamed on the weakness in North American markets.
Diageo’s ADRs rose about 5% on Thursday, but are down nearly 4% since the beginning of the year.
Texas Roadhouse (TXRH), the steakhouse chain, announced in July that its customers were purchasing fewer alcoholic beverages, and the company’s senior director of investor relations and financial analysis said it expects to see “a decline in alcoholic beverages in the coming quarters.” “I wouldn’t be surprised if some negative mix of alcoholic beverages remains.”
“This is not a Roadhouse-specific problem, and there appears to be more to the industry and society at this point,” they added.
