FrieslandCampina to Shed 600 Jobs

Cees ’t Hart, CEO of Royal FrieslandCampina: “The aim of the proposed reorganisation of the production is to reduce costs further by means of an increase in scale and efficiency improvements."

11 Dec 2009 --- Dairy company, Royal FrieslandCampina N.V., plans to reorganise its production sites over the next couple of years. As a result, a total of six sites will be closed in the Netherlands, Germany and Belgium. A total of 318 new jobs (FTEs) will be created and 942 jobs will be lost. On balance, 624 out of a total of 20,500 permanent jobs worldwide will be lost. This afternoon, the employees at the sites affected were informed of the plans. The employee representation bodies were involved in the process. The Trade Unions have also been informed.

Following the merger between Friesland Foods and Campina at the end of 2008, opportunities for maximising the production, packaging and cheese distribution operations were investigated. The merger led to an overlap in production. The investigation involved identifying the various products, production systems, the capacity utilisation and the scope for growth at each site. A decision was then taken on how production could best be organised.

Cees ’t Hart, CEO of Royal FrieslandCampina: “The aim of the proposed reorganisation of the production is to reduce costs further by means of an increase in scale and efficiency improvements. We will do all we can to help the employees who are losing their jobs to find a new job either at FrieslandCampina or outside the organisation.”

Consumer Products Europe

The plan is to close the production site at Elsterwerda (Germany) in mid-2011. The production of yoghurts and desserts in Germany will be relocated to the sites at Gütersloh, Heilbronn and Cologne. This means that 300 jobs will be lost at Elsterwerda. In Gütersloh, 72 new jobs will be created and 17 new jobs will be added at Heilbronn.

The intention is also to close the production site at Kalkar (Germany) in mid-2011. In Kalkar, 173 jobs will be lost. The production of long-life milk (UHT) for the German market will move to Cologne (Germany), where eight new jobs will be created. The production of long-life milk for the Dutch market and the production of Chocomel and yoghurt drinks will be moved to Aalter (Belgium), where 71 new jobs will be created. The production for the Hungarian market will be moved to Debrecen, where seven new jobs will be created.

In Leeuwarden, the plan is to close one unit, the Packaging-South department, in the second quarter of 2011. Coffee creamer is packaged in this department. As a result, 73 out of a total of 850 jobs will disappear in Leeuwarden. The coffee creamer produced in Leeuwarden will be packaged in Aalter (Belgium), where 26 new jobs will be created, and Bornem (Belgium), where six new jobs will be added.

Cheese & Butter

The plan is to close the cheese packaging sites of FrieslandCampina Cheese in Drachten and in Tilburg at the end of 2010. The cheese bulk packaging operations at Drachten will be moved to Leerdam. All 60 jobs in Drachten will be lost as a result. Some of the cheese standard packaging operations in Tilburg will be moved to Leerdam and some to Wolvega. This means that 104 jobs will be lost in Tilburg. In Leerdam, 47 new jobs will be created and in Wolvega, 45 new jobs.

It is also planned to close the cheese production and cheese processing department in Tilburg in the first quarter of 2011. This will mean the loss of 83 jobs. Cheese production will be relocated to various cheese production sites. This reorganisation will lead to the creation of two new jobs in Bedum.

Tilburg is also home to the Development department of FrieslandCampina Cheese, with 31 staff. The development activities will be moved to Wageningen. The future location of the development activities and the pilot plant is still to be finalised. No jobs will be lost as a result.

The intention is to close the cheese production site in Dronrijp in the second quarter of 2011. The operations will be relocated to various sites. A small part of the production will be outsourced. This will lead to the loss of 86 jobs. Whey is also processed in Dronrijp. The future of the FrieslandCampina Domo site in Dronrijp depends on the location study being conducted by the Ingredients business group, and pending the outcome of the study, will continue to operate as an independent site.

The plan is to close the production site for butter oil and cream products in Klerken (Belgium) in mid-2011. Production will be moved to Noordwijk and Lochem. The 63 jobs in Klerken will be lost. In Noordwijk, 15 new jobs will be created and in Lochem, two.

Implications for the workforce

The permanent employees affected in the Netherlands are covered by FrieslandCampina’s Social Plan. As a result of these proposals,405 of the 7,400 jobs in the Netherlands would be lost and 111 new jobs would be created. In Belgium, a total of 63 of the 1,200 jobs would be lost while 103 new jobs would be created. In Germany, 473 of the 2,200 jobs would be lost and 97 new jobs would be created. In addition, seven new jobs will be created in Hungary. In Belgium, Germany and the Netherlands, discussions will be held with the employee representation bodies about the plans and the implications for the workforce.

FrieslandCampina will make every effort to ensure that new jobs are found that are acceptable to the employee and the employer, preferably at FrieslandCampina, but if this cannot be achieved within a reasonable period, outside the company.