Diageo the drinks producer has swallowed two large exceptional charges as a result of restructuring initiatives in a set of full year results that demonstrate that its top line brands, such as Guinness and Johnnie Walker whisky, are suffering during the credit crunch.

Diageo has announced two restructuring strategies in 2009. In February it said it will create £120 million in cost reductions by June 2010, this resulted in an exceptional charge of £166m. Then last month a second restructuring plan was announced that aims to create savings of £40m by June 2012 to reduce the production costs of its maturing products, such as whisky. An exceptional charge of £120m will be taken.

The February restructuring plan focuses on brewing operations at the Diageo Irish plants. The second initiative involves the consolidation of its three packaging sites in Scotland at Kilmarnock, Glasgow and Fife; one will be lost with Kilmarnock closing.

Diageo has reported an underlying growth of four per cent, down from nine per cent growth for the same period in 2008. It said the volume of its sales were "weak in all markets", with Europe down four per cent, North America down six per cent and Asia Pacific down 11 per cent. Top brands such as Johnnie Walker have been hardest hit.

Brian Franz, Diageo CIO is involved in the restructuring of the supply chain which he said will provide the company with a competitive advantage over the next 10 years. Franz has also been renegotiating its global IT service level deals to cut costs. Diageo has three main suppliers of its IT infrastructure, Accenture, CSC, IBM and Verizon.