Food & Beverage

Diageo sales up 1.8% despite 'mixed up' markets

We have 'weathered' the emerging markets: Diageo CEO

Drinks maker Diageo — which owns the Johnnie Walker whisky, Smirnoff vodka, and Guinness stout brands — reported a 1.8 percent increase in six-month sales, boosted by business in North America, which rose 4.6 percent.

Ivan Menezes, chief executive of Diageo, who took over from longstanding head Paul Walsh in July, told CNBC: "Western Europe is turning the corner. The emerging markets are all mixed-up."

Operating profit grew by 2.9 percent, helped by lower margins.

In its interim results, published Thursday, the company said that beer was the only category where sales fell, down 2.6 percent, after weakness in Nigeria and Ireland.

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The company is trying to overcome a slowdown in growth in emerging markets, where it has a high exposure. China and Nigeria were the two emerging markets where growth was most concerning, according to Menezes.

(Read more: 'Diddy' duets with Diageo for tequila takeover)

In Western Europe, sales fell by 1 percent, marking a slowing in the decline. The company has hiked its interim dividend by 9 percent to 19.7 pence.

There has also been recent speculation that Diageo is on the look out for acquisitions.

In November, the company's CEO denied reports that it was looking to buy rival Beam, which makes Jim Beam, J&B and Talisker whiskies. However Japanese drinks group Suntory eventually bought the group for $16 billion earlier this month.

Analysts have since speculated that Diageo could be interested in targeting Brown-Forman — the owner of Jack Daniels.

(Read more: Diageo profit up after 'rocky' emerging market ride)

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