Unilever plans to eliminate 7,500 positions globally in an effort to streamline operations and reduce costs by approximately €800m (£684m) within the next three years.
The corporation that produces various consumer products, such as Marmite, Dove soap, and Lynx deodorant, has a workforce of 128,000 employees globally, with 6,000 based in the United Kingdom.
Unilever mentioned that employees would be involved in discussions regarding the reductions, but did not disclose the locations where they would occur.
The plan proposed a productivity strategy that would generate approximately €800 million in cost savings within the next three years. It also revealed intentions to separate its ice-cream division from the company.
The company’s top-selling ice cream brands, including Wall’s, Magnum, and Ben & Jerry’s, account for five out of the top 10 worldwide. Additionally, they produce Cornetto, Viennetta, Carte d’Or, and Breyers, a popular brand in the United States.
The division, which brings in €7.9 billion in yearly revenue, will likely undergo a demerger, although Unilever is exploring alternate possibilities. The company anticipates completing the spin-off by the end of 2025.
After the split, Unilever will have four segments remaining: beauty and wellness, personal hygiene, household cleaning, and nutrition.
According to Unilever’s chairman Ian Meakins, the division of their ice-cream business and implementation of a productivity program will lead to a more streamlined, targeted, and successful Unilever. Additionally, it will establish a top-tier ice-cream company with favorable potential for growth and a promising future as an independent entity.
In January 2023, Hein Schumacher was named as the new chief executive, replacing Alan Jope. Regarding the growth action plan, Schumacher stated that the company has pledged to focus on quality over quantity to make a bigger impact.
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According to Matt Britzman, a financial analyst at Hargreaves Lansdown, Unilever’s decision to divest from the Ben & Jerry’s ice cream unit is a demonstration of action that shareholders have been hoping for from the new leadership. The ice cream division has always stood out when compared to other product lines and has faced difficulties in terms of performance recently. While this move may not come as a surprise, it is something that previous management was unable to achieve.
The announcement boosted Unilever’s shares by over 5% on Tuesday morning, making it the top performer on the FTSE 100 index.
Source: theguardian.com
