For most of the past 15 years, Diageo was possibly the most admired company at the top end of the FTSE 100 index. As well as being an export titan for the UK, the Johnnie Walker, Smirnoff and Guinness group performed beautifully for its shareholders year after year.
Sales growth invariably beat inflation, underpinned by an enviable balance between developed and emerging markets. Profit margins steadily improved under a “premiumisation” strategy of encouraging punters to “drink better, not more”. Acquisitions worked, allowing Diageo to go from nowhere to leader in tequila in no time. Sir Ivan Menezes, who died just before he was due to retire as chief executive last summer, was rightly hailed as a boardroom superstar.
