Martin Deboo from Investec said that Diageo was “more assertive” than it had been for some time, as it unveiled the share price-boosting announcement.
The company saw a 4.65% rise in share price after it reported an upbeat set of results for the year to the end of June, despite weakness across most of Europe.
Deboo said that he was “surprised by such a positive share price reaction”, which he attributed to the market being in a very fearful state at present.
Investors had focused on Diageo’s medium term guidance Deboo suggested, which was that in a three-year term it would see a 6% rise in annual organic growth and also widening margins.
Its reported success in emerging markets, and with premium brands despite economic conditions, combined with an ongoing efficiency programme, also made it a “positive statement in a difficult market”, he said.
The maker of Smirnoff vodka and Johnnie Walker whisky said that net sales in Great Britain were up 2%, which made Britain its strongest performing EU territory.
Net sales in Spain and Greece were down 18% and 38% respectively. Overall volume sales in Europe declined 2%.
Full-year net profits were up by 17% to £1.9bn and net organic sales up by 5% to £9.94bn.
The company said that emerging markets in Latin America, Africa and Asia grew strongly.
Net sales were up 5% in its international operations (including Latin American, Caribbean and Africa) and by 16% in Asia Pacific.
Chief executive Paul Walsh said: "Our leading brands and superior routes to market have delivered volume growth, positive price/mix, gross margin expansion and strong cash flow. We have strengthened the business, investing more behind our brands and in our routes to market and we have deepened our leading brand and market positions in the fastest growing markets of the world. In addition we have implemented changes to drive further operational efficiencies."
Meanwhile, Dutch brewer Heineken, which owns brands including Kingfisher and Strongbow, warned this week that a damp summer would wipe out its profits growth in 2011.
Diageo’s rival, world No 2 spirits maker Pernod Ricard reports its annual results on September 1.
Chris Halliday, partner and co-head of the Africa group at international law firm Eversheds, commented on the Diageo results: “The rise of consumerism in emerging markets is a trend which is particularly noticeable in Africa. The continent’s potential for growth in consumer demand is huge.”