Propel Newsletter Archive Page

Diageo warns of price rises amid US tariff threat, ‘working round the clock’ to replenish Guinness supplies as demand ‘surpasses expectations’: The maker of Guinness and Johnnie Walker has warned it may have to raise prices as it scrambles to limit the impact of US president Donald Trump’s trade war. Diageo said yesterday (Tuesday, 4 February), it would face a $200m (£161m) hit to profits if Trump follows through with this threat of 25% tariffs on Canadian and Mexican goods from 1 March. Diageo bosses said they were exploring numerous ways to alleviate the damage posed by tariffs, but warned prices would likely have to rise. Ewan Andrew, president, global supply chain and procurement and chief sustainability officer, said: “We can mitigate a lot of it before pricing, but not all.” Roughly 45% of Diageo’s US sales come from products made in Canada, largely whiskies, and Mexico, where it makes tequila brands such as Don Julio. Almost 85% of the potential $200m hit is linked to tequila. Yesterday the White House agreed to pause the introduction of tariffs on Canada and Mexico for one month amid negotiations with the countries, which are traditionally two of America’s closest allies. Diageo, which has been meeting with officials from the Trump administration, said mounting geopolitical and economic uncertainty meant it would abandon its target of up to 7% sales growth this year. However, chief executive Debra Crew highlighted the success of Guinness as a bright spot for the company, saying demand for the stout had “surpassed” expectations. Diageo’s UK revenue rose 2% as booming demand for Guinness, which saw net sales grow by 13% over the first six months of its financial year, offset lower spirits sales. Diageo recently denied it was planning to sell its Guinness brand. Over Christmas, a social media-fuelled surge in Guinness orders in the UK led to pubs running out of the Irish stout and forced the introduction of rationing. Crew said: “We are working around the clock to replenish our stock levels and are boosting those quickly. We are spending €200m on a new factory in Kildare, in order to bring more capacity online.” Crew said demand for Guinness was now also picking up abroad. Diageo reported sales in the first six months of its financial year fell 0.6% to $10.9bn over the six months to January, with operating profits down $3.2bn – a 4.9% decrease compared with the prior year. Shares in Diageo fell 4.2% yesterday morning.

Premium Club members to receive new searchable and segmented New Openings Database and videos from Restaurant Marketer & Innovator on Friday: The next Propel New Openings Database will be sent to Premium Club members on Friday (7 February), at midday. The database will show the details of 268 site openings, including which company has opened a site or its plans to open one in the future. It will have details on what type of site it is and its location, and there will also be a website link to the businesses. The database is published on a monthly basis and Premium Club members will also receive a 15,168-word report on the 268 new additions to the database. The database is segmented into seven categories – cafe bakery, casual dining, experiential leisure, fine dining, hotels, pubs and bars, and quick service restaurants – making it even easier for users to search. The updated database includes new openings in the cafe bakery sector such as Sprigg and salad bar brand Choppaluna launching sites in Glasgow, and Knead Bakery opening in Oxford. Premium Club members are to be given access to the entire recording of the 2025 Restaurant Marketer & Innovator European Summit Conference. Members will be sent 26 separate video presentations, featuring more than 60 speakers, on Friday at 9am. Premium Club members also receive access to five other databases: the Turnover & Profits Blue Book, the Multi-Site Database, the UK Food and Beverage Franchisor Database, the UK Food and Beverage Franchisee Database and the Who’s Who of UK Hospitality. All Premium Clubs members will be offered a 20% discount on tickets to Propel paid-for events including Excellence in Pub Retail (May 2025) and discounts on specialist sector reports such as the Propel 500. Operators that are Premium Club members are also able to send up to four members of staff to each of our four Multi-Club Conferences for free. Premium Club members receive their daily Propel Info newsletter 11 hours earlier than standard subscribers, at 7pm the evening before. They also receive videos of presentations at eight Propel conference events two weeks after they are held. This represents around 100 videos of industry insight over the course of the year. Premium Club members will be sent a dedicated monthly newsletter that will highlight key updates in the sector and direct subscribers to all the vital content their membership offers. Premium Club members also receive exclusive opinion columns every Friday at 5pm, which include the thoughts of Propel group editor Mark Wingett and a host of industry leaders from across the sector. A Premium Club subscription costs an annual sum of £495 plus VAT for operators and £595 plus VAT for suppliers. Companies can now have an unlimited number of people receive access to Premium Club for a year for £995 plus VAT – whether they are an operator or supplier. Email kai.kirkman@propelinfo.com today to sign up.

Chipotle CEO hints company is ready to start building its UK pipeline again as restaurant level margins ‘improve measurably’: Chipotle chief executive Scott Boatwright has hinted the company is ready to start building its pipeline in the UK again with restaurant level margins having “improved measurably”. In April last year, Propel revealed Chipotle had promoted Anat Davidzon, formerly Chipotle managing director Canada, to managing director international, overseeing both Canada and Europe, including the UK. Jacob Sumner remained director of European operations, reporting to Davidzon. Last summer, Chipotle appointed Ben Williams, who has been with the company for almost 20 years, to managing director Europe, after previously being a regional vice-president in the US. Speaking about international markets following the company’s fourth-quarter update where it reported net sales increased 13.1% to $2.85bn for the year ending 31 December 2024, Boatwright said: “They’ve [UK restaurant level margins] improved measurably so much so that we have decided to go ahead and start looking at site development in specific areas of western Europe to begin to build the pipeline to grow again. And so we have a lot of confidence in the team. We have confidence in the progress and continue to make month-over-month progress. And we know that we have, and we can drive or create a viable business in the western Europe markets we operate in today with hundreds of restaurants and potentially thousands of restaurants in other markets, adjacent markets that we can bring in.” Chipotle, which operates 18 sites in London plus one in Guildford, is planning a further regional opening, in Essex’s Lakeside shopping centre. For the year ending 31 December 2023, Chipotle reported that turnover for its UK business increased to £26,336,692 compared with £17,910,338 the year before.

Di Maggio’s Restaurant Group reveals expansion plans including London debut: Scottish restaurant operator Di Maggio’s Restaurant Group (DRG) has revealed plans for several new restaurants, including its London debut, as part of major expansion plans. Last year, the group acquired the Glasgow-based, two-strong Paesano Pizza, and sister business Sugo Pasta, for an eight-figure sum from restaurateur Paul Stevenson. Both concepts are set to be expanded. One of the Paesano locations is set to be in Pollokshaws Road in Shawlands on the south side of Glasgow where it will take over the group’s former Di Maggio’s premises this summer. The DRG, which is owned by Mario Gizzi and Tony Conetta, said further rollouts are expected over the next 12 months. The group said the recent acquisition of the two businesses is its “most significant acquisition to date”. Conetta told The Herald: “Within 12 months, we expect to have doubled the number of Paesano and Sugo restaurants to six and we have firm aspirations to further expand north and south of the border in the years ahead.” Gizzi added: “The integration of Paesano and Sugo into our wider operations has been virtually seamless. It’s gone exactly as we would’ve hoped, and the shared ethos of high-quality dining and superb, authentic ingredients has already proved to be a winning formula. Much of the credit goes to the highly professional teams we inherited as part of the deal.” There is currently one Sugo restaurant in Glasgow, located in Mitchell Street, which opened in 2019. The first Paesano restaurant opened in Miller Street in Glasgow in 2015 and was followed by a second location in Great Western Road in 2017. The DRG is also currently in “advanced discussions” to open its first diner in London as part of its plans to expand its Café Andaluz concept. It comes after branches opened in Newcastle and in Stockbridge, in Edinburgh. Earlier this week, Propel reported DRG, which operates 21 sites, posted a profit of more than £5m for the year ended 28 April 2024 following a third successive year of record turnover. The company’s pre-tax profit grew from £4,906,554 in 2023 to £5,168,430, off turnover of £49,520,159, up from £45,837,615 in 2023.

The Goodwood Estate – successful year of trading affected only by Festival of Speed cancellation: The Goodwood Estate has said a successful year of trading in 2023 was affected only by the cancellation of the Saturday at the Festival of Speed due to high winds. The company’s turnover increased from £128,287,988 in 2022 to £135,925,570 but pre-tax profit was down from £8,599,006 to £3,433,459 as costs rose by more than £9m. There was also a £81,624 loss on revaluation of assets (2022: £1,748,455 gain). Director Charles Gordon-Lennox, the 11th Duke of Richmond, said: “Goodwood Group enjoyed a successful year of trading, with the only exception being the Saturday cancellation of Festival of Speed, which has affected the financial results due to the timing of the insurance compensation. The flagship motorsports events exceeded expectations. The Festival of Speed had a record year, with both corporate and consumer sales exceeding prior year performance levels and admissions selling in record time, and Goodwood Revival was once again a sold-out admission event. The racecourse held all 19 race days and attendance increased significantly against 2022 while revenue remained in line with prior year due to the unseasonal weather impacting some key race fixtures. The second year of the Goodwood event was successfully completed while focus continues on developing initiatives to drive commercial success in the coming years. The club and hotel companies had a challenging year as the effects of an ever-competitive market, the national cost-of-living crisis and high wage and cost inflation were felt.” Net interest costs decreased to £0.7m (2022: £0.8m) and net debt at the year-end decreased to £7.2m (2022: £7.9m). Dividends of £1,337,950 were paid (2022: £2,299,881).