Ivan Menezes

Shares in the firm closed up nearly 4% yesterday after the firm resumed a £4.5 billion return of capital to investors.

The firm has highlighted its continuing recovery from the COVID-19 crisis as it sees strong growth in the US and the gradual reopening of the on-trade in Europe.

In a trading update issued yesterday, the firm said in Africa, Asia Pacific and Latin America and the Caribbean, it seeing a continued recovery in most markets, despite the ongoing impact from COVID-19.

Ivan Menezes, chief executive of Diageo, said he was “very pleased” with how the business is recovering in fiscal 21.

He said: “Our strong competitive performance across key markets and our robust cash generation. Our disciplined approach to capital allocation is unchanged.”

He added: “When we have excess cash, we have been clear that we will seek to return it to shareholders.

“The Board’s decision to resume our return of capital programme at this time reflects Diageo’s improved performance in the first half of fiscal 21, the continued strong recovery of our business, and our expectation that we will be back within the top end of our target leverage ratio1 of 2.5-3.0x at 30 June 2022, post completion of the second phase of the return of the capital programme.”

Mr Menezes said that the firm was confident that it would “continue to execute effectively in this challenging environment and will emerge stronger.”