FDBusiness.com

Diageo sets out £1billion Scotch whisky investment plan

 Breaking News
  • UK Grocery Prices Rising at Fastest Rate in Four Years The latest grocery market share figures from Kantar Worldpanel, for the 12 weeks to 5 November 2017, show UK supermarket sales have increased in value by 3.2% year-on-year in the run up to Christmas. Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, explains: “Volume sales have increased by less than 1%, meaning it’s [...]...
  • Alcohol Minimum Unit Pricing to Go Ahead in Scotland The UK Supreme Court has ruled that minimum unit pricing for alcohol, which was passed overwhelmingly by the Scottish Parliament in 2012, can now proceed. Scottish Health Secretary Shona Robison has welcomed the decision and confirmed she intends to make a statement to Parliament shortly, setting out the Scottish Government’s next steps. Following the unequivocal backing [...]...
  • GEA Brings Together Technologies to Supply Extended Production Line For BMI GEA has recently been selected to supply an extended pasta filata cheese production line for BMI in Jessen, Germany. With this exemplary project GEA brings together its joint cheese-making expertise, resulting from its acquisition of de Klokslag and CMT in 2014 and 2015 respectively, with GEA’s flow and processing experience to provide a single offering for this [...]...
  • Bosch Packaging Technology Wins German Design Award 2018 The Sigpack VPF (Vertical Platform for Flat Pouches), the first freely scalable flat pouch machine from Bosch, has been honoured with the German Design Award 2018 in the Excellent Product Design category. The German Design Council presents the prestigious award on an annual basis. The German Design Award is the second prestigious accolade for the [...]...
  • Premier Foods Returns to Revenue Growth Premier Foods, the UK convenience food group, has reported group revenue of £353.3 million for the 26 weeks ended 30 September 2017 – an increase of 1.5% on the prior period – with Branded revenue in line with last year at £295.4 million while Non-branded revenue increased by 10.1% to £57.9 million. Group reported half year [...]...

Diageo sets out £1billion Scotch whisky investment plan

Diageo sets out £1billion Scotch whisky investment plan
June 08
07:20 2012

– New malt whisky distillery and major expansion of existing distilleries
– Substantial warehousing expansion to store maturing spirit
– Hundreds of jobs created in Diageo and wider Scottish economy

Diageo, the world’s leading premium drinks business, has unveiled plans to invest over £1billion in Scotch whisky production over the next five years to meet growing global demand for its brands.

A major new malt distillery will be built as part of the investment, alongside a programme of major expansion at a number of Diageo’s existing distilleries. Detailed plans will also be developed for a second new distillery which will be built if global demand for Scotch is sustained at expected levels.

The company also plans to invest in substantial new warehousing capacity to house the millions of additional litres of Scotch whisky which the distillation investment will produce.

Announcing the investment Diageo Chief Executive, Paul Walsh said: “This is a pivotal moment in the development of the Scotch whisky category for Diageo. Over recent years our brands have achieved remarkable, sustained global growth. Scotch whisky is Scotland’s most celebrated manufactured export, led by brands like Johnnie Walker, resonating with consumers from Boston to Beijing.

“We expect that success to continue, particularly in the high growth markets around the world, which is why we are announcing this major investment in Scotch whisky production, committing over £1billion in the next five years, to seize that opportunity for global growth. This builds on the foundations we have already laid down over recent years through sustained investment in both production assets and in maturing Scotch inventories.

“Scotch whisky is a significant manufacturing export industry in the United Kingdom, driving domestic investment and job creation through our success in exporting to high growth markets around the world. We look forward to working with both the UK and Scottish Governments to realise the full potential of our investment plan, and to continue growing global Scotch exports.”

Across Scotland the investment will create over a hundred new Diageo jobs, largely high value jobs in rural areas of Scotland. It is also expected the investment will create an average of 250 construction jobs for each year of the investment period and in wider Scottish economy there will be a knock on effect which will generate around 500i further jobs. Diageo also intends to make its contribution to efforts to tackle youth unemployment by taking on around one hundred apprentices and graduate trainees over the term of the investment, and the company will also encourage its suppliers and construction contractors to focus on youth job creation and apprenticeships.

The investment programme will be underpinned by Diageo’s commitment to reduce its environmental impact, with a programme of bio energy solutions planned to be implemented over the same timescale as the distillery expansion projects.

Mr Walsh added: “I’m particularly pleased our investment will generate significant numbers of new Diageo jobs, as well as boosting the local construction sector and stimulating job creation throughout the Scottish economy. We are determined to use this investment to make a contribution towards helping people into training and work through our apprentice and graduate placement scheme and by using the opportunity to encourage suppliers to take on apprentices to work on the investment projects.”

In the last five years Diageo has reported 50% growth in net sales of its Scotch brandsii with total net sales approaching £3billion this financial year. Scotch represented 23% of Diageo’s volume, 27% of net sales and a third of gross profit in the financial year 2011iii. In the first half of financial year 2012, Diageo’s Scotch category saw 8% volume growth and 14% net sales growthiv.

Over the five year period Diageo plans to invest over £500 million in the construction of the distillation and warehousing capacity. This increased production capacity also requires Diageo to commit £500million in working capital for the maturing spirit which will be laid down over the next five years. The exact total investment figures may vary over time depending on the progress of specific projects, but the overall commitment is expected to total over £1billion over the five years.

Supporting this investment, Diageo also plans to commit £5 million over five years towards community initiatives as part of its sustainability and responsibility programme in Scotland. Priority areas for the community investment programme will be: leadership in the environment; responsible drinking – improving the night economy and safety at local level; and socio-economic development, including youth employment and entrepreneurship. This will involve an integrated approach across Diageo’s production, commercial and brands heritage businesses, including The Gleneagles Hotel, host to the Ryder Cup 2014. Full details of this programme will be announced in due course.

About Author

colin

colin

Related Articles



Food & Drink Business Conference & Exhibition 2016

Upcoming Events

  • November 28, 2017Fi Europe
  • December 4, 2017Plastics and Paper in Contact with Foodstuffs 2017
  • January 8, 2018RAI Exhibition
  • January 16, 2018Sival Plant Production Trade Show
AEC v1.0.4

find food jobs

The Magazine

F&D Business Preferred Suppliers

New Subscriber





Subscribe Here



Advertisements