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Diageo, the world's biggest producer of alcoholic drinks, on Thursday posted rising third-quarter sales, aided by a strong performance in the United States, but also revealed a sharp slowdown in key emerging markets.
Group sales, excluding acquisitions, disposals and currency effects, grew 4.0 percent in its third quarter, or the three months to the end of March, Diageo said in a trading update.
That compared with a 6.0-percent increase in the same part of its previous financial year. Volumes meanwhile slid 1.0 percent.
Market expectations had been for sales growth of 5.0 percent, according to Dow Jones Newswires.
Diageo added that sales meanwhile increased by 5.0 percent in the nine months to the end of March.
Over the same period, North America sales rose 6.0 percent, up from 5.0 percent a year earlier.
Asia Pacific sales meanwhile gained just 4.0 percent over the nine months. That contrasted with 10-percent growth in the previous fiscal year.
On a nine-month basis, Diageo also posted a combined 9.0-percent increase for Africa, Eastern Europe and Turkey. Latin America and Caribbean sales soared 14 percent, despite weakness in Brazil, while Western Europe sales dropped 4.0 percent.
Diageo added that its Asia Pacific performance was hit by the timing of price increases and the decline of the Scotch whisky market in South Korea.
"Our performance in the quarter was robust and again demonstrates Diageo's strengths, global reach and category breadth and depth," added chief executive Paul S Walsh in the statement.
"Therefore despite consumer weakness in three markets, Korea, Nigeria and Brazil, Diageo's performance for the nine months is in line with the first half and our expectations.
"Strong performance from our biggest business, US spirits; the continued growth of spirits in Africa; share gains across our markets in Asia Pacific and double digit growth of Johnnie Walker, Crown Royal, Buchanan's, and Tanqueray are the highlights of the quarter.
"Given our market positions and geographic diversity we remain confident that Diageo's performance continues to be in line with our medium term guidance."
The British brewing giant's key products include Baileys liqueur, Captain Morgan rum, Guinness stout, Johnnie Walker whisky, Smirnoff vodka and Tanqueray gin. Almost 40 percent of Diageo's business is in emerging markets.