New chief aims to rebuild investor confidence
Drinks giant Diageo has appointed former Tesco chief executive Sir Dave Lewis as its new boss. He will officially take over on 1 January, following the summer resignation of Debra Crew, who spent two years in charge. The company hopes his appointment will revive its weakening performance. Despite Guinness enjoying continued growth, Diageo’s wider sales have declined, pushing its shares to a 10-year low. News of his appointment lifted shares by 7% in early trading on Monday.
Global sales face mounting pressure
Diageo, owner of Johnnie Walker, Smirnoff and Captain Morgan, has struggled in major markets such as the United States and China. Sir Dave brings more than 35 years of experience from consumer goods firms, including six years leading Tesco and nearly three decades at Unilever. He will step down as chairman of health group Haleon to focus on Diageo. The board praised his “proven leadership and turnaround skills,” saying he was “the right person to lead Diageo now.”
‘Drastic Dave’ ready for bold decisions
Sir Dave, nicknamed “Drastic Dave” for his tough and decisive management style, said he saw both challenges and opportunities ahead. “The market faces headwinds, but there are significant opportunities too,” he said. “I’m looking forward to working with the team to meet those challenges and create lasting shareholder value.”
Profit decline adds urgency to change
In the year to June, Diageo’s operating profits fell 28% to £3.2 billion. The company admitted there was “much more to do” after what it called a challenging year. Inflation has squeezed consumer budgets, leading many people to spend less on eating and drinking out. Younger consumers are also drinking less alcohol than previous generations, forcing traditional brands to rethink their strategies.
Analysts predict a rapid shake-up
Market watchers expect Sir Dave to act fast. Dan Coatsworth, head of markets at AJ Bell, said, “He’s known for listening carefully to customers and suppliers to identify problems. His focus will be on fixing what’s broken, not chasing long-term growth just yet.” Coatsworth added that Sir Dave left Tesco after stabilising the company, not expanding it, suggesting a similar short-term approach could apply at Diageo.
A veteran leader steps in
Sir Dave will replace Nik Jhangiani, Diageo’s chief financial officer, who has served as interim chief executive since Ms Crew’s departure in July. With his reputation for bold decisions and sharp execution, Sir Dave Lewis now faces the task of steadying Diageo and steering one of the world’s best-known drinks companies back to growth.
