McCormick & Co. has said it plans to accelerate its Comprehensive Continuous Improvement (CCI) efficiency programme in the Europe, Middle East and Africa region.
The US spice maker said it plans to implement “several projects” in the EMEA region, the majority of which are subject to employee or works council consultation. Actions identified include the closure of McCormick’s current operation in the Netherlands, where it will use a third party to continue to distribute the Silvo brand.
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The CCI programme was launched in 2009 in a bid to improve efficiency. Throughout 2012, the group achieved savings of more than US$200m, the company said. In 2013, McCormick expects to deliver savings of $55m.
McCormick said it expects to record about $27m in charges related to the plan with around $25m to be recorded in 2013. As a result, the company revised its projected 2013 earnings per share to be at the lower end of a $2.89 to $2.95 range. Adjusted operating income for the fiscal is expected to rise by 3-5%. This excludes an expected negative impact of 4% related to the CCI programme and negative 3% from US pension charges.
Annual CCI cost savings are projected to reach around $10m by 2015, the company added. This will contribute to the company’s long-term goal of achieving at least $45m in annual CCI-related cost savings.
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