Dec 5 2011 --- Cargill has announced that it will reduce its workforce by up to 2,000 of its 138,000 employees globally, a change of about 1.5 percent. The majority of the reduction will take place over the next six months worldwide. Cargill is providing affected employees with severance and outplacement support in keeping with its policies and with local laws and regulations.
The company said these actions are in response to the continued weak global economy and are part of an overall effort to reduce expenses and simplify work processes. “As economic conditions change, so must we,” said Mike Fernandez, corporate vice president of Cargill Corporate Affairs. “Regrettably, this impacts talented people who have made important contributions to our company. These are difficult decisions but are necessary to better position the company for continued growth.”
The reductions are based on recommendations from Cargill’s business units and functions as to how to best allocate resources, based on their specific situations. They are not the outcome of any companywide percentage mandate or uniform across-the-board cut. Rather, the goal is to ensure the company is focusing its resources on those activities that add the most value for its customers.
The layoffs come after two consecutive declines in quarterly profits at Cargill after more than a year of steady earnings increases. Cargill's fiscal first quarter profits, reported in October, were down 66 percent from a year ago.
At that time, Cargill's Chief Executive Greg Page said the downswing was largely due to "the persistently high degree of uncertainty in the global economic environment, which injected turbulence into commodity markets and limited prudent trading opportunities."
The last time Cargill had a significant amount of layoffs was in the wake of the global financial and economic meltdown that started in late 2008 and went into 2009.
The news came as Kerry confirmed that it has completed the acquisition of Cargill’s global flavours business.
Cargill Flavor Systems with annual revenues of approximately US$200m was acquired for a total consideration of US$230m. The acquisition strengthens Kerry’s capability to provide integrated customer solutions across all food and beverage end-use-markets.
Cargill Flavor Systems employs 700 people throughout its integrated flavour development and application centres in France, the UK, South Africa, India, Malaysia, China, the USA, Puerto Rico, Mexico and Brazil, supported by a network of sales representative offices in 12 other countries.
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Date:05 December 2011
Summary:The company said these actions are in response to the continued weak global economy and are part of an overall effort to reduce expenses and simplify work processes. The layoffs come after two consecutive declines in quarterly profits at Cargill after more than a year of steady earnings increases.