Diageo Hit by Stock Reductions and Declining Demand

Dear Client:Planned stock reductions for Diageo’s U.S. wine and spirits wholesalers caused net sales to decline -7% in the third quarter. Inventories at March 31 were approximately one million cases lower than stocks on December 31. Diageo also experienced a significant decline in the Russian market and the Global Travel Retail business.U.S. net volumes were down -15% which indicates weak underlying demand as well, said analyst Chris Pitcher with Redburn. He noted that “Diageo is outperforming its spirits peers (Pernod