Diageo Keeps Walking as Activists Push Consumer Giants on Profit

Johnnie Walker sales grow as Americans embrace cocktail hour
Scotch gains in U.S., but Ciroc, Ketel One vodkas struggle

Bottles of Johnnie Walker Blue Label blended scotch whisky travel along the the production line at Diageo Plc's bottling plant in Leven, Scotland, on Wednesday, June 19, 2013. Diageo Chief Executive Officer Paul Walsh will step down in July, almost 13 years shaping the company into the world's largest distiller and hand over the reins to his chief operating officer Ivan Menezes.
Photographer: Mike Wilkinson/Bloomberg

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By Thomas Buckley

January 25, 2018 at 7:27 AM UTC

Updated on

January 25, 2018 at 10:19 AM UTC

This article is for subscribers only.

As activist investors stalk the world’s largest consumer giants, Diageo Plc is trying to stay ahead by lifting earnings, reducing expenses and accelerating a turnaround in mammoth brands such as Johnnie Walker whisky.

Benefits from productivity initiatives will continue in the second half and Diageo expects to make good progress toward a goal of expanding its profit margin, Chief Financial Officer Kathy Mikells said on a call. The shares rose after the company reported a 6 percent increase in first-half operating profit to 2.2 billion pounds ($3.1 billion), beating analyst estimates.