You are here
Danone to cut up to 2,000 jobs, aiming to save S$1.6b
[PARIS] Danone will cut as many as 2,000 jobs, including one in four positions at its global headquarters, as the world's largest yogurt maker attempts to revive profitability amid the pandemic.
Danone said Monday it's considering moving global headquarter sites for its various businesses lines closer to the base of its French operations in Paris. Annual cost savings should reach 1 billion euros (S$1.61 billion) by 2023, also fuelled by more efficient purchasing.
Chief Executive Officer Emmanuel Faber is shifting the organisation to focus on geographical zones rather than product categories to become more agile amid the pandemic. Competitors like Nestle SA have long followed a regional strategy. The job cuts represent about 2 per cent of Danone's total staff.
"This year has shown our businesses could be hurt significantly in their competitiveness by external shocks in countries where we operate," Mr Faber said on a call with reporters. "In this very volatile world for the next several years, we need to create a safety margin." Total one-time costs related to the changes will be about 1.4 billion euros for the 2021-2023 period. Danone has global headquarter sites across in the world in locations such as Amsterdam and Singapore. About 400 to 500 jobs will be cut in France, a spokesman said.
Danone also said its adjusted operating margin should exceed 15 per cent in 2022 and reach mid-to-high teen levels later, which would be a record level.
Danone shares have slumped 29 per cent this year.