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Preliminary results , year ended 30 June 2021 29 July 2021 DIAGEO Diageo delivers strong growth in net sales , operating profit and cash generation and is well positioned for the future Delivered strong net sales growth , particularly in North America , our largest market Reported net sales ( £ 12.7 billion ) increased 8.3 % , with strong organic growth , partially offset by an adverse foreign exchange impact . - Organic net sales growth of 16.0 % , driven by growth across all regions and a benefit from lapping a reduction of inventory levels by our customers in fiscal 20 . North America organic growth of 20.2 % , reflecting resilient consumer demand , spirits taking share of total beverage alcohol and the replenishment of stock levels by distributors and retailers . Operating profit growth ahead of net sales growth - Reported operating profit ( £ 3.7 billion ) increased 74.6 % , and reported operating margin increased by 1,112bps , primarily due to a significant reduction in exceptional operating items . Organic operating profit growth of 17.7 % , following decline in fiscal 20 , with growth in all regions except Europe and Turkey . Organic operating margin increased 46bps , driven by overhead efficiencies and lapping one - off expenses , partially offset by gross margin decline and upweighted marketing spend . Responded to increased consumer demand in off - trade channel , gaining market share Broad - based growth across categories , including tequila , scotch , Chinese white spirits and Baileys . Held or grew off - trade market share in over 85 % ( i ) of total net sales value in measured markets . On - trade significantly restricted in many markets due to Covid - 19 , particularly impacting beer in Europe . Invested in long - term growth despite near - term uncertainty due to Covid - 19 Increased investment in marketing by 23 % , ahead of organic net sales growth . Continued capex investment in capacity , digital capabilities , consumer experiences and sustainability . Expanded gin and ready to drink portfolios with acquisitions , including Aviation American Gin . Maintained strong ESG and stakeholder focus ' Raising the Bar , ' our $ 100 million global on - trade recovery fund , has already reached c.35,000 outlets in eleven countries . In this year's survey of our people , 89 % of respondents ( 1 ) said they were proud to work for Diageo . 25 ambitious new goals in our ' Society 2030 : Spirit of Progress ' , 10 - year sustainability action plan , including net zero carbon emissions across our direct operations by 2030 . Excellent cash flow generation Increased net cash from operating activities by £ 1.3 billion to £ 3.7 billion , and free cash flow by £ 1.4 billion to £ 3.0 billion , driven by growth in operating profit , working capital management and a delayed 2019 dividend from associates , partially offset by an adverse foreign exchange impact . Strong balance sheet , with leverage ratio of 2.8x at 30 June 2021 , back within our target range . Created long - term shareholder value Increased basic eps by 89.4 % to 113.8 pence and pre - exceptional eps by 7.4 % to 117.5 pence . Increased recommended final dividend by 5 % to 44.59 pence per share . Recommenced return of capital programme of up to £ 4.5 billion by the end of fiscal 24 . Delivered 10 - year annualised total shareholder return of 13 % . See page 48 for explanation and reconciliation of non - GAAP measures . ( i ) Source : Internal estimates incorporating AC Nielsen , Association of Canadian Distillers , Dichter & Neira , Frontline , Intage , IRI , ISCAM , NABCA , Scentia , State Monopolies , TRAC and other third - party providers . All analysis of data has been applied with a tolerance of +/- 3 bps . Percentages represent percent of markets by total Diageo net sales contribution that have held or gained off - trade share . India and Canada share data represents total trade . Measured markets indicate a market where we have purchased any market share data . Market share data may include beer , wine , spirits or other elements . Measured market net sales value sums to 87 % of total Diageo net sales value in fiscal 21 . ( ii ) 85 % of our global employees completed the survey . 1 Diageo Preliminary results , year ended 30 June 2021