Leadership change aims to spark recovery
Diageo, the world’s biggest drinks company, has appointed former Tesco boss Sir Dave Lewis as its new chief executive. He will take over on 1 January, following the resignation of Debra Crew, who left in the summer after two years in the role. The move comes as Diageo battles falling sales despite the continued strength of Guinness. Its shares recently dropped to a 10-year low but jumped 7% in early trading after the announcement.
Global brands under strain
The firm owns household names like Johnnie Walker, Smirnoff and Captain Morgan but has seen declining sales in key markets such as the United States and China. Sir Dave, who ran Tesco for six years until 2020, spent nearly 30 years at Unilever before that. He will step down as chairman of health company Haleon to take on his new challenge. Diageo’s board said his track record and leadership made him “the right person for Diageo at this time.”
‘Drastic Dave’ returns to the spotlight
Known as “Drastic Dave” for his bold and decisive management style, Sir Dave expressed optimism about the road ahead. “The market faces some headwinds, but there are significant opportunities,” he said. “I look forward to working with the team to tackle these challenges and create value for shareholders.”
Profits drop as consumers cut back
In the year to June, Diageo’s operating profits fell 28% to £3.2 billion. The company described the period as difficult and admitted there was “much more to do.” Rising inflation has made consumers more cautious, reducing spending on dining and drinking out. At the same time, younger generations are choosing to drink less alcohol than their predecessors, forcing major drinks brands to adapt.
Analysts urge swift action
Market analysts say Sir Dave will need to act quickly to restore Diageo’s momentum. Dan Coatsworth, head of markets at AJ Bell, said, “He listens closely to customers and suppliers to pinpoint problems. His immediate focus will be repair work rather than long-term growth.” Coatsworth added that Sir Dave left Tesco after stabilising the business rather than expanding it, suggesting a similar strategy may apply at Diageo.
Experienced hand to steady the company
Sir Dave replaces interim chief executive Nik Jhangiani, Diageo’s chief financial officer, who has led the company since Ms Crew’s departure in July. With his record for decisive action and steady leadership, Sir Dave Lewis faces the challenge of restoring confidence and sales at one of the world’s most recognisable drinks makers.
