New chief takes the helm amid tough trading
Drinks giant Diageo has appointed former Tesco chief executive Sir Dave Lewis as its new leader. He will take over on 1 January, following the summer departure of Debra Crew after two years in the role. The company hopes his appointment will revive slowing sales and rebuild investor confidence. While Guinness remains a bright spot, Diageo’s overall performance has weakened, with shares recently sinking to a 10-year low. After the news broke, the company’s share price jumped 7% in early Monday trading.
Global brands under growing strain
Diageo, which owns Johnnie Walker, Smirnoff and Captain Morgan, has faced declining sales in major markets such as the United States and China. Sir Dave brings decades of experience, having spent nearly 30 years at Unilever before leading Tesco from 2014 to 2020. He will leave his current position as chairman of health firm Haleon to join Diageo. The company’s board described him as a “proven leader” with the skills needed to guide Diageo through challenging conditions.
‘Drastic Dave’ known for bold decisions
Sir Dave, nicknamed “Drastic Dave” for his decisive leadership style, said he sees both risks and opportunities ahead. “The market faces headwinds, but there are also significant opportunities,” he said. “I’m looking forward to working with the team to meet these challenges and deliver value for shareholders.”
Profits tumble as consumer habits shift
Diageo’s operating profits fell 28% to £3.2 billion in the year to June. The company called the period “challenging” and admitted there was “much more to do.” Rising inflation has squeezed household budgets, leading consumers to cut back on dining and drinking out. Younger generations are also drinking less alcohol than before, pushing the company to adapt its products and marketing strategy.
Analysts urge swift recovery plan
Analysts say Sir Dave must act fast to repair the company’s performance. Dan Coatsworth, head of markets at AJ Bell, said, “He listens carefully to customers and suppliers to understand what’s gone wrong. His focus will be on stabilising operations before chasing long-term growth.” Coatsworth added that Sir Dave’s decision to leave Tesco after restoring stability suggests he may take a similar approach at Diageo.
A steady hand for a global brand
Sir Dave will replace interim chief executive Nik Jhangiani, Diageo’s chief financial officer, who has led the company since Ms Crew’s resignation in July. With his reputation for sharp decision-making and turnaround expertise, Sir Dave Lewis now faces the challenge of reigniting growth and steering Diageo back to the top of the global drinks market.
