Diageo plc (“Diageo” or “we”) is submitting this letter in response to the written comments of the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”),
dated April 5, 2024 (the “Comment Letter”), on Diageo’s Annual Report on Form 20-F filed with the Commission on August 3, 2023 for the fiscal year ended June 30, 2023 (the “Form 20-F”).
Set forth below is the heading and text of the Staff’s comment followed by our response.
Operating results 2023 compared with 2022
Income statement, page 66
We note that the line items for “Adjusted” columns of the template form of the table you provided in response to prior comment 1, appear to present a substantially full income statement of non-GAAP measures. Please tell us your consideration of Question
102.10 of the Compliance and Disclosure Interpretations on Non-GAAP Financial Measures and Item 10(e)(1)(i)(A) of Regulation S-K and tell us how you will apply the guidance accordingly in future filings.
Response
We respectfully acknowledge the Staff’s comment and respectfully advise the Staff that we have now removed the "Adjusted" columns of Exhibit A as a template form of the table that the Company intends to use going forward. The intention of the table is to explain the movements between selected prior year income statement line items and the current year. To address the requirements of Compliance and Disclosure Question 102.10 and Item 10(e)(1)(i)(A) of Regulation S-K, we have labelled the table as "Key financials - certain line items" and have excluded
various lines from the income statement. The year ended 30 June 2022 and 30 June 2023 reported columns for the line items presented now agree directly to our GAAP income statement, and the columns in between have been labelled as movements between the prior period and current period. We have added a footnote which makes it clear the reported figures agree to our GAAP income statement.
Tom
Shropshire, General Counsel and Company Secretary
Connie Milonakis (Davis Polk & Wardwell London LLP)
Scott Berryman (PricewaterhouseCoopers LLP)
Exhibit A
Proposed illustrative reformatted and renamed “Key financials––certain line items” table (using as a reference, information from our 2023 “Income Statement” table in our Annual Report on Form 20-F for the Fiscal Year Ended June 30, 2023 filed
on August 3, 2023):
Year-on-year movements
Key financials – certain line items
Reported
30 June 2022 £ million
Exceptional operating items £ million
Exchange
£ million
Acquisitions and disposals
£ million
Organic movement
£ million
Fair value remeasurement
£ million
Hyperinflation
£ million
Reported 30 June 2023 £ million
Sales
22,448
—
588
(683)
1,091
—
71
23,515
Excise
duties
(6,996)
—
114
569
(122)
—
33
(6,402)
Net sales
15,452
—
702
(114)
969
—
104
17,113
Cost
of sales
(5,973)
(67)
(363)
84
(522)
5
(63)
(6,899)
Gross profit
9,479
(67)
339
(30)
447
5
41
10,214
Marketing
(2,721)
—
(151)
(15)
(152)
(1)
(11)
(3,051)
Other
operating items
(2,349)
(167)
(66)
(16)
26
49
(8)
(2,531)
Operating profit
4,409
(234)
122
(61)
321
53
22
4,632
Other
line items:
Non-operating items
(17)
328
Taxation
(1,049)
(970)
Reported
figures included in the table above have been extracted from the income statement for the years ended June 30, 2022 and June 30, 2023
Dates Referenced Herein and Documents Incorporated by Reference
