IFF to reduce workforce by 6%
The company will eliminate approximately 300 positions in manufacturing, selling, research and administration functions, principally in its European and North American operating regions.
10/01/06 International Flavors & Fragrances Inc. has announced plans to eliminate approximately 300 positions in manufacturing, selling, research and administration functions, principally in its European and North American operating regions; the reductions represent 6% of the Company’s workforce.
As a result of these actions, the Company anticipates recording pre-tax restructuring charges of $25 million to $30 million, the majority of which will be recognized in the fourth quarter 2005; the remaining charges are expected to be recognized in the first half of 2006. Essentially all elements of the restructuring charges relate to employee separation.
Richard A. Goldstein, IFF’s Chairman and CEO, stated, “We are continually striving to ensure IFF’s creative facilities and global operating network are as efficient as possible and fully aligned with our customers’ needs and expectations. IFF has many hardworking and dedicated employees, which made this decision difficult. However, these actions are a necessary part of our ongoing efforts to maintain and improve IFF’s profitability in the economic environment in which we operate.”
The Company also announced that, consistent with previous expectations, full year 2005 sales declined 2% in comparison to the prior year in reported dollars. Sales for 2005 benefited from the strengthening of various currencies, particularly the Euro, in relation to the U.S. dollar; had exchange rates remained constant, 2005 sales would have decreased 3% in comparison to the prior year. Sales in 2005 were impacted by the disposition, in the second half of 2004, of the Company’s European fruit preparations business. On an as-adjusted basis, excluding $58.3 million in sales attributable to the fruit business from 2004 results, 2005 sales would have increased 1% in dollars and been flat in local currency.
The Company expects to release earnings for the 2005 fourth quarter and full year on January 25, 2006, at which time additional details regarding the restructuring charges will be provided; in the release, the Company will also provide its initial guidance regarding 2006.
