In a filing with the US Securities and Exchange Commission, Del Monte Foods said that it anticipates charges associated with its recently announced transformation plan to total US$22m before tax.
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On 22 June, Del Monte announced a two-year transformation plan designed to further the company’s increased focus on value added products alongside its fourth quarter results.
“The transformation plan is intended to further the company’s progress against its strategic goal of becoming a more value-added, consumer packaged food company. The plan’s initiatives are focused on strengthening systems and processes, streamlining the organisation and leveraging the scale efficiencies expected from the company’s May 2006 acquisition of Meow Mix Holdings, Inc. and expected acquisition of certain assets related to the Milk Bone brand. The company expects to complete its transformation plan within two years,” Del Monte’s SEC filing stated.
The San Francisco-based fruit and vegetable company said that it anticipates staff-cutting costs of $11m, charges related to property and equipment of $10m and $1m in other costs.
“Streamlining our business and improving our systems and processes will make us more nimble, giving us the flexibility and speed we need to meet the needs of our customers and consumers,” Richard Wolford, chairman and CEO, said when he delivered Del Monte’s Q4 results.
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By GlobalData“By continuing to improve our competitive capabilities through improved organisational effectiveness and speed of decision-making, as well as a reduction in operating costs, this transformation plan will significantly enhance our growth potential,” Wolford concluded.
