US food manufacturer General Mills has said it will cut around 850 jobs globally as part of a productivity and cost savings plan announced today (22 May).
The plan, which includes organisational changes to the company, is designed to “strengthen business alignment” and “improve organisational effectiveness” it said.
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The company said it will record total restructuring charges of around US$109m pre-tax, reflecting one-time employee separation expenses and the asset-related costs. Around $94m of the restructuring costs will be recorded in the fourth quarter of fiscal 2012, which ends on 27 May it said. The remaining costs will be recorded in fiscal 2013.
Savings from the restructuring actions will be reinvested, General Mills said, to support the company’s future growth strategies and to “accelerate innovation” across its global business platforms.
The company said it continues to target fiscal 2012 adjusted diluted EPS of $2.53 to $2.55 per share. This excludes the fourth quarter restructuring charge, mark-to-market valuation effects, and Yoplait integration costs. The company acquired a 51% stake in Yoplait last May.
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In March, General Mills reported a drop in profits for the first nine months of its fiscal year as input costs offset higher sales. Net profit was down 16% in the period to 26 March. Operating profit sank 9.5%.
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