Diageo has said its proposed restructuring is intended to build a “more agile, competitive and cost-effective operating model”, as 172 Scottish distillery workers face potential redundancy.
The drinks giant, which operates 31 distilleries in Scotland, is consulting on proposals affecting 172 staff, with GMB Scotland warning that 38 jobs could be lost as part of the company’s wider global restructuring plans.
GMB Scotland has strongly criticised the way Diageo has handled the consultation process, claiming workers’ concerns and possible alternatives have not been meaningfully considered.
Lesley-Anne Macaskill, GMB Scotland organiser in the Highlands and Islands, said: “We have now had five meetings with the company to discuss its plans but there has been no serious attempt to engage with our members’ concerns or modify its plans in any way.
“This has not been a genuine consultation but a box-ticking exercise by a company intent on steam-rollering through job losses to a plan that has already been decided.
“The absolute refusal to engage with our members’ concerns is a morally bankrupt betrayal of a skilled, experienced and committed workforce.”
The union has accused Diageo of rejecting suggestions that could lessen the impact of compulsory redundancies, including voluntary redundancy and job-sharing arrangements. It has also raised concerns about the effect potential job losses could have on rural communities where distilleries are major employers.just-drinks+1
Diageo has now provided further detail on the commercial context behind its plans, following its Capital Markets Day and preliminary financial results for the year ended 30 June 2026.
The company reported net sales of $19.6 billion for the year, a reported decline of 3% compared with the previous year. Organic net sales were down 2%, with growth across Europe, Latin America and the Caribbean, and Africa offset by weaker trading in North America and Asia Pacific.
Organic operating profit before exceptional items rose 2%, supported by cost-saving measures. However, reported operating profit fell 27.2% to $3.16 billion, with restructuring costs and impairment charges affecting the result.
Diageo has announced plans to deliver approximately $1 billion in savings over the next three years. This includes around $850 million through a redesigned operating framework, alongside a further $150 million in supply-chain savings. The business expects the restructuring programmes to result in costs of around $1.2 billion.
Sir Dave Lewis, Diageo’s chief executive, said: “This new strategy, executing with a new, more agile, competitive and cost-effective operating model, gives us confidence that we can return Diageo to a business consistently creating value for shareholders.”
Lewis said the company still faced challenges, particularly in North America, but maintained that Diageo could improve performance while protecting operating profit.
“There is hard work ahead, particularly in North America, where improving performance is a clear priority, but we are confident we can deliver without taking a step back in operating profit,” he said.
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In its preliminary results statement, Lewis said the revised operating framework was being rolled out across the business and that the planned savings would support investment in Diageo’s turnaround.
“These savings will allow us to invest in the turnaround without needing to reduce operating profit,” he said.
Diageo expects the new operating model to begin generating savings in its 2027 financial year, as it seeks to return to sustainable growth while reducing costs across the business.ers as they respond to changing international demand and seek to reduce costs across their operations.
