Diageo plc

Good morning and welcome to Diageo's F24 Preliminary Results Q&A Conference. Your call today will be hosted by Deborah, Diageo's CEO, and Lavanya, Diageo's CFO. This conference is being recorded. To ask a question today, please press star followed by one on your telephone keypad. To withdraw your question, it's star followed by two. We are now ready to start the call. Deborah, please go ahead.

Good morning and thank you for joining our Preliminary Results call for Fiscal 24. I hope you've had a chance to read our press release and watch our presentation on Diageo.com. Fiscal 24 was a challenging year for both our industry and Diageo as we navigated a volatile operating environment across the globe. Group organic net sales declined 0.6% and the main driver was materially weaker performance in Latin America and Caribbean region. For perspective, if you exclude LAC, organic net sales grew plus 1.8%, driven by resilient growth in Africa, Asia Pacific, and Europe regions. This offset the decline in North America, which was attributable to a cautious consumer environment, retailer inventory adjustments, and the impact of lapping inventory replenishment in the prior year. We made good progress against our strategic priorities, and we ended fiscal 24 gaining or holding share in over 75% of our net sales value in measured markets, including in the U.S. We also took deliberate actions to improve on near-term execution, and these include meeting our commitment to improve our inventory position in LAC, stepping up our route to market across several key markets, including our most significant transformation in at least a decade in our U.S. spirits organization, and delivering a record productivity savings of nearly $700 million. We've also generated $2.6 billion in free cash flow while continuing to invest for long-term growth. Looking ahead to fiscal 25, the consumer environment continues to be challenging, and we expect the challenges we saw towards the end of fiscal 24 to persist. Our focus continues to be on strengthening our business's resilience, and investing smartly in strategic initiatives to enable us to return to growth when the consumer environment improves. I continue to believe in the long-term fundamentals of TBA, Diageo's advantage position within it, and our ability to grow ahead of TBA and gain quality market share. We'll open it up for questions. Can we get the questions started?

Thank you. As a reminder, if you'd like to ask a question, please press Start, followed by 1 on your telephone keypad. Our first question for today comes from Simon Hales of Citi. Your line is now open. Please go ahead.