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04/09/2008
Profits Up But Guinness Price Set To Rise
Despite glowing profit margins and cheaper ingredients, the price of a pint of Guinness refuses to settle, and is set for a price hike.
Diageo have confirmed they are planning to increase the price of Guinness by 2% or €0.10 in two weeks time. The price rise is expected to be passed on to customers.
Last week, Guinness owners Diageo announced their net sales were up by 7%, their operating profit up was up 9%, and a free cash flow of €1,543 million.
A spokesman for Diageo said: "Guinness grew net sales 6% with over 50% of that growth coming from Africa, where the brand grew 13%. Price rises and mix improvement covered increased input costs and gross margin has improved."
The announcement of the extra 10 cents comes in the wake of findings last week, which showed Guinness was one of the only pints to have experienced an increase in sales while its competitors had taken a tumble.
Guinness witnessed sales grow by 2.5% against a declining beer market, prompting Diageo to try their luck and tap into its surging popularity and favourable international conditions.
In February, Diageo also announced that sales in Britain and Ireland had risen following their new €12 million Domino add campaign.
The price increases follow high profile protests by farmers last month, who demanded higher prices for barley.
Malting barley prices on offer to tillage farmers are at €165 per tonne, down from €205 last year.
Fine Gael's John O'Mahony criticised the hike in prices. He said: "Farmers have had the price they receive for their barley slashed, but it is clear that any saving generated from this is not going to be passed on to the customer."
See: Guinness Sales On The Up
(DW/JM)
Diageo have confirmed they are planning to increase the price of Guinness by 2% or €0.10 in two weeks time. The price rise is expected to be passed on to customers.
Last week, Guinness owners Diageo announced their net sales were up by 7%, their operating profit up was up 9%, and a free cash flow of €1,543 million.
A spokesman for Diageo said: "Guinness grew net sales 6% with over 50% of that growth coming from Africa, where the brand grew 13%. Price rises and mix improvement covered increased input costs and gross margin has improved."
The announcement of the extra 10 cents comes in the wake of findings last week, which showed Guinness was one of the only pints to have experienced an increase in sales while its competitors had taken a tumble.
Guinness witnessed sales grow by 2.5% against a declining beer market, prompting Diageo to try their luck and tap into its surging popularity and favourable international conditions.
In February, Diageo also announced that sales in Britain and Ireland had risen following their new €12 million Domino add campaign.
The price increases follow high profile protests by farmers last month, who demanded higher prices for barley.
Malting barley prices on offer to tillage farmers are at €165 per tonne, down from €205 last year.
Fine Gael's John O'Mahony criticised the hike in prices. He said: "Farmers have had the price they receive for their barley slashed, but it is clear that any saving generated from this is not going to be passed on to the customer."
See: Guinness Sales On The Up
(DW/JM)
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