Diageo has lowered its marketing spend by 2% for the first quarter of its financial year to £903m but still saw a 1% increase in its operating profit of £2.4m.
The major drinks company also announced plans to cut its costs by £200m a year until June 2017 as a slowdown in key emerging markets takes its toll.
The maker of Johnnie Walker scotch and Guinness posted net sales growth of 1.8% for the six months to December 31, its first half, following 2.2% growth in the first quarter.
Total emerging markets net sales rose 1.3% in the first half while sales in Western Europe fell 1%.
North American sales rose 4.6%, helping to shore up operating profit, which rose 2.9% to £2.06bn.
But investors suffered a shock after performance in emerging economies such as China after Asian stock markets fell overnight.
Diageo shares fell 4.4% to £18.26 in early trading, making the company the biggest faller in the FTSE 100.
Overall in Asia Pacific, Diageo’s net sales were down 10%.
Political issues, large tax rises and a weak economy hit sales in Thailand severely.
Other markets also had lower sales due to economic uncertainty and weakening currencies.
Beer sales in Nigeria declined as low government spending and high inflation sent consumers towards cheaper brands and away from Guinness and Harp.
Diageo's chief executive, Ivan Menezes said: "We have continued to demonstrate the strength of our broad portfolio and diverse global business in a period which saw a more challenging emerging market environment."
"Sustained performance in the US and improved performance in western Europe enabled Diageo to absorb the current challenges in some of our emerging markets. We reacted quickly to the changing emerging market environment, reducing inventory levels in several key markets, which led to a weaker Q2 [second quarter]."
Net sales in Greater China fell 22% in the first half, mainly because of plunging sales of Shui Jing Fang, Diageo's brand of baijiu, the 52% proof white spirit that is drunk to seal business deals.
Diageo said: "Greater China performance largely reflects the impact of the government's anti-extravagance measures. The Shui Jing Fang business was most affected, with significant price discounting by competitors in the baijiu category driving a 66% decline in net sales."
A number of drinks companies have been affected by the impact in China of government efforts to crackdown on luxury gifts and entertainment by officials.
Earlier this month French spirits group Rémy Cointreau posted a decline in third quarter sales as a result of the Chinese Government crackdown.
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