Good afternoon, everyone. My name is Mitch Collett from Deutsche Bank's Consumer Staples Research Team in London, and I am delighted to be joined on stage by Nik Jhangiani, the CFO of Diageo. Nik, it's only been a couple of weeks since we saw each other in Dublin. I'm aware that at that event you had your very 1st pint of Guinness.
I did.
I guess the 1st question that I'd like to know the answer to is, how was that pint of Guinness?
Actually, it was pretty amazing, and I was not quite sure how I was going to feel about it. It was funny because my son kept telling me, "Do not try your first Guinness in front of the investors. You have terrible ways of controlling your facial expressions." That is not a criticism, but you know, just be careful. The night before, they took me up to the bar and actually poured my own Guinness. It is quite a procedure, six steps. It was quite exciting. I actually did quite well. I am going to say something I am not supposed to say. Is this being—oh, I should not say that. I am just saying it already. No, I am not. OK, it is being webcast, so I will not say it. If anybody wants to know what happened, I will tell you separately.
I tried my 1st Guinness, and I tried side by side the Guinness 00. I swear to you, if someone was not standing by me telling me what I should be kind of looking for in terms of the difference in the taste, I would not have known. Good experience. Having said that, I am still pretty much in love with this brand.
OK.
Yeah, I just add it to my repertoire, let's put it that way.
It's a great product, so hopefully the first of many. You're roughly nine months into the role, still a relative newcomer to Diageo. What are your reflections on Diageo as a business? What has impressed you, and what do you think needs more work?
Yeah, it's been nine months. It's been a long nine months. I've been on the road a lot, which has been really positive because I've literally, outside of getting into Latin America physically, as in into some of the larger markets there, I had a chance to meet the whole team in Miami. I have been pretty much everywhere, from South Africa to Nairobi to Nigeria to Shanghai to Singapore. I'll stop naming them, but yeah, I've traveled a lot. You know why it was really important was to get a really good sense of our people, but also get a chance to meet our customers, right, and get a sense of what they like, what was challenging, what were they seeing in terms of market trends, et cetera. It's been amazing.
What clearly was evident was we truly have some of the world's best brands, right? We are leaders across multiple categories, if not most of the categories in which we play within the spirit space. I have been blown away by the level of our marketing. I think our supply chain capabilities are fantastic as well, right? It is quite concentrated when you think about that. Very solid there. Ultimately, it is all fueled by 30,000 very passionate people who really believe in the business, really believe in the brands, and want to grow, right? It has been a challenging time for the last couple of years, I think, coming out from what happened in November 2023 with the profit warning and then obviously just kind of the macro situation, the slowdown, and the destocking, et cetera. Incredibly passionate people who want to win.
A lot to kind of rebuild in terms of that confidence internally, but what we can deliver externally as well. On the flip side, I think there's lots of opportunities, right? I say that with a perspective of, I think we're really solid on the brand side. I think we haven't necessarily been as solidly synced up when I think about brand and physical availability and commercial execution, right? I see that being even more important in a space where it is quite crowded when you think about TBA or if you even think about the spirits world, right? Whether it's walking into a bar and seeing the back bar display, and if you're looking for something, it's hard to find.
When you go onto a menu, and it's not just going to be one category or one product or one brand that's listed or called out, right? When you go into a shopping aisle of a liquor store or a retailer, it's a very crowded space, right? I mean, in terms of the number of brands. And actually, what's actually grown even within categories of brands is flavor proliferation, right? Vodka being a clear example of that. I think it becomes even that much more important around how good are we at execution at the point of sale where you're truly able to link up physical and mental availability. I think there's a lot of opportunity there. Clearly, I think we have opportunities when you think about metrics in terms of how we are focused and measured.
I think, obviously, continuing to look and lead the way from a growth angle, given how large we are in terms of within the industry, particularly in North America. A big part of that, I think, is also how we think about RGM and pricing and mix that continues to be relevant when you link it back to consumer occasions, choices, channel structure, your pack price architecture, et cetera. There is a lot more in that space, I think, that we can do.
Understood. Thank you. Two weeks ago, you launched Accelerate, where you're targeting $500 million of cost savings. At the event in Dublin, you gave some context around the four buckets of savings as you see them. Perhaps let's dig into each of those. The 1st one is A&P.
We'll start there. OK.
OK. If that's OK.
Yeah.
Absolutely. Where do you see the biggest opportunities to make your A&P more efficient? Yeah. What makes you confident you can do that without harming your brands? To what extent does digital and AI play into that opportunity?
Yeah. I would actually take the two buckets together because I think there's A&P spend, and there's also trade investment. I'm going to link them up a little bit so you get a sense, right? I think let's start with the most simple one around our A&P spend. I'm just going to give you that 1st bucket piece in terms of the split, rough numbers. Roughly about 40% of our spend of that bucket of circa $3.6 billion is in what you would call media scale and reach. What are you really doing, whether it's through print, digital, social, TV, et cetera, in terms of back to that mental availability piece, right? Good dollars there. I'll come back to how I think we can do that differently. OK?
You have linked to that is very much about circa 20%, which is your development costs or your non-working, as you might call it, right? That is everything from your creatives to your media buying through content generation, et cetera. That is about 20%, right? I think when you look at those two holistically 1st, I think there is a big opportunity to bring down that non-working. This is where I think AI, to your point, comes in and better digital tools because all of our media buying today is so disparate and so fragmented, and there is no reason why it should be that way, particularly in a world where we have great tools and you have an ability to even narrow down the number of agencies that you work with, even absent tools, right?
The 2nd piece is there's a lot of duplication of costs because in what has been quite a decentralized model within Diageo, even their global brand teams, there's almost been an ability for local teams to content create and actually use some of what their local content creation is versus what is the global brand, even though they might be sticking to brand parameters, right, of what are the intrinsics or the extrinsics you want to talk about, but they're driving duplication. Why? Because they've been allowed to, right? In some ways, I almost say, if we change the way we work in terms of that development where there's co-creation between the local brands, local companies, or local markets and the global teams, and it doesn't have to be in every area or category. Gin, for instance, we know the U.K. is very big in gin.
We know, for instance, Spain is very big in gin. We know there are certain countries in Latin America that are very big in gin. If they're content co-creating, you avoid that duplication of costs, and then you get the benefit around the fact that that content that has been created gets better wear and wear out, right? Because you're running it more through a larger number of markets, your returns on that are a lot better as well, right? I think both in terms of non-working through tools, content creation, co-creation, the virtual studio that we've created that allows you to actually take something and do it with AI within seconds, where you actually do not even need to bring another agency in when you're thinking about what's going to be relevant for GB versus what's going to be relevant for Spain, for instance, right?
How you can customize that within seconds, right? I was with the CEO of WPP a week ago, and he was in our office having drinks with us. He was showing me literally on his screen two ads that were running side by side, right? One that had cost tens of millions to build and create and one that had been created by AI. OK? I actually got it wrong in terms of which one was which. OK? It just tells you the power of what is available out there that allows us to think about that development cost.
The media scale and reach piece, I don't think we've been very good at how we're allocating that spend back to a full cohesion across the line when you're looking at that mental and physical availability, but sufficiency of spend behind a brand and also returns both on a short-term and a long-term metric. I think you've got to look at it holistically, right? I don't think we've been very good about doing that. I think there's been a lot of money put. Some of it's great, but there's an opportunity to really rework that. Then you've got your commercial A&P piece, which is really about your commercial execution, right, and what you're doing, point of sale material, for instance, what you're offering in terms of promo activity. That also links to your gross to net, which is your trade investment.
Both of those have been outpacing our top-line growth. That is not acceptable for me, right? I think there is a big opportunity in terms of how we look at rationalizing that spend in a more effective way to drive more pay-for-performance as well, right? That is a multi-year journey. That does not happen overnight, right? I think when I look at those two buckets in combination, that clearly is an opportunity for us to go after, right? Actually, to your point, not compromise our brand equities and actually invest better dollars with better returns around growth.
If we can dig in, I know you covered trade spend optimization then, but how do you think about managing trade spend such that it does not impact affordability, given that affordability is clearly something that consumers are very focused on now?
Yeah. I think that the challenge in your question there is you're thinking that I'm going to cut trade spend. I'm actually talking about optimizing my trade spend and linking it to more pay-for-performance. I do not want to take it away from my customer, but I want to link it to what is consumer-facing and what is ultimately reaching them as opposed to funny money that they just get to deduct and keep in their pockets, right? That is the difference. It is not necessarily about reduction. It is about optimization. With optimization, there could be better allocation and some reduction as well, right? There is duplication of trade spend both in trade investment and commercial A&P as well, right? Within commercial A&P, the other piece that we are not doing very well is how well we actually do our POS part. OK? Clearly, that is an opportunity too.
I don't see us in any way risking our brand equities. In fact, I see us being over-indexed on investing around brand development, around brand equities, particularly where growth is.
Understood. Thank you. Maybe the next two parts, we'll try and do those together. Overhead is part of it. I've always thought Diageo is actually a very efficient business. Interested to know how you can take money out or make cost savings on overhead. Also supply chain, because you have the supply chain agility program, which I think is still running. Are these savings incremental to that, or is it all sort of woven in together?
I'm not going to get into what's incremental or what because I'm drawing a line in terms of what was in the past. I can't really talk about that. I'm talking about what we can do for the future. I think to your point around overheads, you are absolutely right. Actually, when you look at it on the element of how our overheads are and how they have been as a part of our revenue, actually, we're running pretty lean. My challenge back would be I don't think we necessarily have invested in the right places. In some places, again, we've got excess and fat and duplication. What do I mean with that? With the fact that we have a very decentralized model, we build a lot and invest a lot in terms of capability, tools, very much at a local level, right?
We do not leverage our scale, right? We have not truly defined clear operating principles. Because I think Diageo, particularly in the last five, six years, has grown tremendously, right? We have not really defined what is the role of a country or a market, a region, and group. What needs to stay very close to in the market is consumer and customer. You do not want to lose that relevance. You have to have that localness, right? That does not mean that everything needs to be tailored and done differently, right? I think that is where we need to leverage our scale and how we build capabilities and look at our business end to end. For me, it is not so much around savings there. It is about reallocation and how do we invest smarter.
One of the areas, for instance, that I talked about was I don't think we have best-in-class commercial execution, right? Where in a crowded space, you probably need that even more. I don't think we've been as structured as we think about marrying up a consumer choice framework with our brand portfolio strategy, with our market growth framework, with how we need to think about outlet occasion segmentation, right? A lot of that last piece and bringing that all together, also the rubber hits the road when you have really good feet on the street, so to speak, right? The feet on the street that are not in there order-taking and/or merchandising, right? Feet on the street that are actually helping the customer upsell and drive their margins and ultimately drive our distributor and our margin as a result of, right?
Only if it is linked to clear occasion channel pack price architecture. RGM is another area where I think we need to build capabilities at a central level and have some element of that local. I think that is the operating model piece that might mean, back to that point that I made earlier or when we talked about this, where some of that might need to be reinvested in different areas to build capabilities that we do not have as strong today.
OK. So you've talked about how the operating model is changing and how that's all being done as part of Accelerate. I guess can you talk about how you are ensuring that employees are engaged and behind the Accelerate initiative? Because it sounds like quite a big change in your approach.
Yeah. Listen, I've been actually very positively surprised by the level of engagement, both from when I've been out in markets, but also as I've talked with the senior leadership group. We've had the opportunity to do two large meetings with them. These are 130 odd top leaders, then also with the exec and then with the board as well. I think bringing clarity and structure and being very clear on the deliverables and the outcomes and the metrics and the incentives all link up, right? It's not doing one without bringing it all together. You know, I think we've got incredibly passionate people, as I said, who are excited about the brands and what we can do.
It's not great, but they feel pretty beat up in terms of what's happened the last couple of years and what that's meant in terms of performance, but what that's also meant in terms of share price, right, for at least that large top cohort. We've got metrics all the way down that are important for everybody as well. I find an incredible amount of energy from the organization around what is Accelerate, because it's not Accelerate being seen as a cost savings and a cost-cutting program. It's Accelerate to allow us to invest where there's growth and actually bring more structure and rigor, but also in some ways simplicity to how we think about our business, right? To date, but more to come as we continue to go down that journey.
OK. Another aspect of Accelerate is the commitment to sustainably deliver at least $3 billion of free cash flow from next year.
Yep.
Maybe we can talk about some of the components there. CapEX, 1st up. I know there are some projects still in flight. You have also said there is going to be a glide path down. I think the level last year was close to 7%. I remember when Diageo had a CapEX, the sales were closer to 4%. Can you give a bit more context on how you managed that glide path down and what is a sustainable level longer term?
Yeah. I think probably for the last four years, there's been an elevated level of spend. Quite honestly, it's been even higher than the 7%, OK? In absolute dollar terms, you're talking about circa $1.3 billion-$1.5 billion a year, all right? It's been quite significant. Now, keep in mind that was very much on the back of a new growth algorithm that was put out, which the narrative got all consumed by just one element of that, which was the top line, which was the five to seven. I think keeping aside the external narrative, internally, that's what was being driven for, right?
Clearly, if you're driving for that, all your choices in terms of investments to be able to support that level of growth go into capacity, go into maturing liquid, go into tools that you're creating so that you can hopefully be able to recognize and capitalize on that growth, all that kind of stuff, right? Now, we are where we are, right? What I'm trying to make sure that we're doing is it doesn't make sense to stop things that are midstream, that are 60%, 70% kind of there. We need to continue. We need to look at how do we effectively really look at that asset base and sweat that asset base a lot more as we go forward, right? That's where the supply chain piece comes in. For me, it's not so much just about procurement savings, et cetera.
It's really about how much more are we going to be looking at efficiency of use of that asset base as we look forward, right? Clearly, as I look at CapEX beyond 2026, I do think there's a glide path. I've said in the short term or in the shorter to midterm, we should see that coming down more towards the five to six, right? I think we also have to keep in mind within that is beer. I think in some ways, you have to pull out the beer piece separate to that. You were with us, and some of you in the room might have been with us in Dublin. The Guinness growth is very, very attractive and continues to be something that we feel we have not leveraged as much. Part of it has been linked to capacity, right?
I wish we could rewind the clock and have pulled back on some of the whiskey and the tequila and the Chinese whiskey and India single malt type of lay down of capacity and put more into Guinness. But hey, listen, hindsight's a great thing. I think we just have to separate that out in terms of how we want to look at that growth profile as well of the beer business. I think if we look at that five to six, and then over time, for me, it's also about not just that percentage, because that can be misleading. What do I see as a good absolute level of spend, right? We'll come back with more color around that in terms of absolute dollars.
Because I think this is a business that also needs to focus on absolute dollars on so many different levels, whether it's on free cash flow, whether it's on operating profit in dollars and gross margin in dollars, as opposed to percentages, which sometimes can be very misleading. I think there's a lot more for us to do on CapEX as we look forward. I think maturing liquid is another area that I'm really looking at with a different lens in terms of both scenario planning in terms of growth, but not just growth within whiskey, growth as we look at categories that even cross over today versus they probably didn't as much in the past. It's a complicated process because you're laying down liquid for what's going to be consumed at a minimum seven to ten years from now.
It is not just about the quantum of liquid any given year. It is also the flavor profile of each of those liquids that you need for your blends, et cetera. A couple of things are changing there, moving away from this historic bias of that was the growth and that is what is going to come back. It is a different world, particularly when you think about cross-category growth. There is also a bit of a risk-averse mindset around I always need to have enough liquid. I never want to be out of stock. I definitely never want to be out of stock. I want to be on shelf, right? I also think that we can manage that by being more dynamic in terms of how we look around managing that throttle around laying down liquid.
Ultimately, our free cash flow is going to be growing also from top line growth, operating leverage, and driving that piece. That is critically important as well, right? We have to put it all together. Like I said, the $3 billion floor on which we feel very confident that we can continue to grow by using all of those multiple levers.
OK. Last question on Accelerate, and then I promise I'll let you move on to something else. The last point is that you have targeted 2.5-3 times net debt through EBITDA by 2028.
No later than.
No later than 2028. Apologies. You said that within that, divestments might play a role. I think you used the word substantial. I appreciate you're not going to tell me what you're selling today. What does substantial look like? What are you solving for? What are you looking for in the assets that you would look to potentially sell?
Yeah. First, what I'm solving for is really stepping back and looking at our strategy and making sure that every one of the assets that we have is rightfully a part of our strategy as we look forward, right? That's the 1st piece. The second piece is alongside that, how capital intensive are some of those businesses and how much of a drain are they as we look at what I want to continue focus on delivering in terms of free cash flow. Most importantly, I would say it also links back to what kind of valuations can I receive? Particularly where some of those assets, again, not getting into details, might be quite interesting for a number of different buyers, right? Actually belong better in line with their strategies than mine, right?
I don't see this being driven in any way by a unilateral focus to delever, although I think clearly that supports our deleveraging targets. Hence, both from a valuation perspective and a timeline perspective, I have not in any way strapped ourselves in because we need to do what's right for realizing maximized value, but because those are not in line with our longer-term strategy.
OK. Thank you. Let's move on to the U.S.
OK.
There is obviously a lot of debate about whether the softer U.S. spirits market growth is a function of cyclicality or normalization or structural factors, including things like GLP-1.
Yeah.
What are your thoughts?
What are my thoughts? I think today, the way I see it today, right, is I think largely the weakness is being driven by the macroeconomic environment and the challenges on the consumer wallet, as well as the fact that you do have this whole destocking cycle in some ways from what was out there in the past. There is a lot of noise and how that keeps moving. I do believe largely, keeping aside tariffs and what has been happening from a tariffs perspective in terms of some of the stocking into the U.S., which I think we called out very clearly with our third quarter results. I do believe other than that, largely that seems to be behind us. Again, I say largely, right? We will continue to monitor and track that.
To your question around the structural versus cyclical elements, I think it's probably the biggest point in my mind that probably keeps me awake at night, right? Why? Because, right, keeping aside macro, I don't think there's enough data to categorically one way or another say these are not having impacts, OK? What do I mean? I'm going to try and break down what are the three biggest ones and what I think is kind of an underlying theme across at least two of them, or broadly speaking, a bigger theme that we need to be conscious of. You look at cannabis. I think hopefully a number of us in this room who've been in the U.S., and cannabis has been around for a long time in a number of states.
From the data that we have to date, and again, I say this is something that we need to monitor, to date, we continue to see that that is not having much of an impact on spirits consumption in particular. In fact, most of the occasions where people are consuming, whether it's edibles, chewables, smokables, in some instances drinkables, and I'm going to come back to that, there's a lot of co-consumption with spirits as well, or with alcohol, right? It's not like you consume one or the other and that's it. There's co-consumption. It is one that we need to keep tracking.
Where I think there is a lot of potential noise, rightfully so, is these THC hemp-derived beverages, right, that are meant to be at a certain level that clearly are not just even crossing those levels, but crossing state borders and getting into ways of distribution that kind of was not what the farm bill was intended for, right? It is an area we need to watch because either it is going to get more regulated, right? If it does, is that something we want to play in? And/or something is going to have to give that, right? It is one that we need to watch.
GLP-1s, to your question, again, from the data that we have seen, and there's probably about 12 million, I'm talking about people who've been on it, or maybe even the number is higher, but people who've been on it or have been in and out, et cetera, again, to date, we're not seeing a significant impact in terms of their reduction of spirits. There I'm going to distinguish TBA and spirits because I do think we're not seeing on spirits there could be something different on the beer side of things, right? For people who were drinking larger quantities of a carbonated or nitrogenated product that probably had some impact on gut from what we're hearing, right? Again, some of that is anecdotal as opposed to true data. I always joke, and I'm sure several of us in this room have friends who are on it.
I always joke and say, if you're going to be on GLP-1s and you're going to be losing some weight and looking good, you probably want to go out and show yourself off. You probably want to consume because that's what you tend to do, right? Now, how you consume, what you consume might be different. I think that's where we've got to continue to stay with that trend because I don't think it's going away, right? I think it's about truly realizing if there are impacts, how do we tailor our offering and our portfolio? I'll come back and talk about that because that's the broader theme to meet that up. I think the 3rd piece is really our Gen Z is drinking less, right? Again, it's one that we need to track and watch.
It's probably going to be the largest cohort of LPA population if you look at the next five years that's coming into the legal drinking age. They're definitely drinking better, not more, is what we see. They're definitely coming into spirits earlier than the millennials of the same age cohort that these guys are, right? Clearly, there's some favorability, but they're definitely drinking less. What does that all kind of play out to when you think about GLPs in particular, maybe cannabis, and then obviously this whole drinking less or not drinking is what does it mean in terms of moderation, right? Because if that is a continuing trend and it's actually only picking up steam, how do we look at that? We've been doing some research, which is again, early days. We're doing it across 21 markets.
We have got some early indications from both the U.S. and GB. There are almost 10 things that people are looking at when we have interviewed them, right? Now, again, take all of this with a bit of a pinch of salt when you do traditional research because everybody is going to lie to you and say, oh, I have not drunk for three months. Oh, I am drinking less. Oh, I floss every day. They have not flossed for a year and a half type of thing. It is good data points for us to think about, right? At one end of the spectrum, we hear people say, I am actually just not substituting, right? What they are doing with their lives, I do not know. I do not want to be hanging out with them. They are just not substituting with anything, right? Are they drinking tap water?
Are they drinking milk? I do not know, right? There is an element of those that say, well, if I am drinking something, I want something that has functional benefits. I want something that is good for me too, right? That is a space that we need to think about. You have people who are just saying, well, I am consuming hot beverages, drinking soft drinks, or drinking premium soft drinks, right? In some ways, there are ways that we might be able to play, particularly when I think about functional elements. When you look at what they are drinking, if they are drinking and staying in the alcohol space, there are five things there too that are happening. One, RTDs, OK? They are looking at that as a way of controlling either their ABV and/or ABV and calories because there are very clear, transparent guidelines in terms of what that is.
There is RTDs. There are smaller formats that people are going to because, again, it is a way of portion control, so to speak. There is a whole focus around this, I am drinking better, not more. How do you continue to play into that premiumization piece when people are going out? I would rather drink one, but really good stuff. Then there are two other pieces which are quite interesting. One is people are drinking zero-zero, so non-alcoholic, right? The last one, which was quite interesting for me, is we want lower ABV products. Now, is that lower ABV products in RTDs? It is lower ABV actual spirits bottles, et cetera. That is a space where I think we need to think about because in my mind, I was thinking, well, you can make your own lower ABV. Just pour half a peg as opposed to a full peg.
Instead of a double, you have a single. I think if it comes back to portion control and being mindful of your consumption, you know what you're consuming when you have lower ABV as well. I think that's where we need to be focused when we think about moderation across how it might play across all of these vectors, right? How do we think about addressing that, particularly in those five or six spaces where we have a right to be able to play and win?
OK. I'm conscious we're getting short on time. Earlier, you mentioned focusing on dollars. I think I've heard you say in the past, perhaps as an organization, you've been a little bit too focused on percentage, profitability versus absolute dollar. Can you talk about what that ultimately means when you think about operating leverage going forward? To what extent is that reflected in incentivization? Or is that perhaps something you're going to look to change?
On the latter, yeah, absolutely. We're having discussions with the Remco. I think as a board, we'll make the right decisions and come out with what do we see as the right metrics because I'm a firm believer around if you have the right metrics and you are measuring those, to deliver those, you need to incentivize them as well. Simple as that. There's no two ways about it. That works time and time again. We've got to be focused on the right metrics. I think it comes back to your question around have we had some of those right metrics? Has there been an over-focus on margin percentage? For all you analysts, including you, Mitch, who loves to do your models, right? I'm not going to make your life easy, right? It's about dollar profits, right?
It is not about just being able to put into a spreadsheet how much is my margin percentage going to grow and what does that really mean, right? On a serious note, I think the challenge has really been it has potentially driven some wrong behaviors or some wrong choices in terms of where we want to play or not play because of margin percentage, even though absolute dollars and value pools are quite attractive. We should be playing that, right? RTDs is a perfect example of that, where I actually look back and I have come in from the Coca-Cola system where we have gone into RTDs. Why have we gone into RTDs? Or why did they go into RTDs? Because it was margin accretive. It was a very similar business and a route to market and all that kind of stuff.
In some ways, you left that space open, right? Did beer companies come in, right? Why? I mean, when you think about Diageo and actually Smirnoff Ice and the fact that even with an inconsistent and unclear strategy around continuing to invest and grow there, right, it still stayed alive. It's a great product, right? We have a huge opportunity when you go back to this element around the fact that it's a recruitment tool. If people are drinking less and drinking better, there's either the premium spirits. If they're also looking at ABV and convenience, right, back to this point around moderation, RTDs play a very important role there. If you marry it up with the right brands for yourself, you actually build brand equity because they're coming into spirits earlier.
I think there are elements of what we need to do to change that mindset and actually play in value pools outside of just RTDs. I can give you several examples, but I know it is 34 seconds. There are examples of where we have not made the right choices, which are going to change going forward.
OK. Thank you. I will try and squeeze one last question in. We've got to talk about India. It's been the great hope for the category globally for a number of years. Now we're nearing a free trade agreement. How do you think about the role India plays for the group going forward?
Incredible. Listen, I think India's played a great role for the company so far, right? I think when you think about the fact that it is one of the largest whiskey markets, and it's not just about the local brands, but really are some of the IMFLs and the more premium opportunities as well, that reduction clearly is something we'd want to pass on, which would stimulate volume and top-line growth, right? It's a category in which I think the team has done an incredible job building out our presence with both local and foreign brands. They've actually expanded both the repertoire and the drinking occasions and the drinkers who are coming into that space. Super excited about that.
Great. That's a perfect place to leave it, Nick. As always, it's been an absolute pleasure. Thank you very much.
Thank you.