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1/31/06

Bakeryand snacks: Kraft cuts 8,000 jobs to offset spiralling costs

BakeryandSnacks

Kraft cuts 8,000 jobs to offset spiralling costs - also in Europe

The manufacturing giant could not confirm where the losses will take place, but a number of redundancies and plant closures are expected across Europe. Yesterday's financial results and restructuring announcement revealed that despite a rigid economy drive, fourth-quarter net revenues were $9.7 billion, up only 3 per cent on last year. And the company claims the quarter's operating income was essentially flat at $1.2bn. For the full year, operating income increased 3 per cent to $4.8bn, held up by cost-cutting and the proceeds of the desserts business sale in the UK. But the pressure is still on to maintain profits. The new restructuring programme is expected to generate another $700m in annual savings that will be used to strengthen the company both in the short- and long-term.

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