News Reorganization
FrieslandCampina is cutting 1800 jobs
At FrieslandCampina, 1.800 of the nearly 23.000 jobs will be lost in the next two years. The cooperative dairy group wants to achieve part of the intended cost savings of €400 to €500 million. The savings plan will initially cost €170 million and that expense will be booked in 2023. This threatens to put FrieslandCampina in the red.
The announced round of layoffs is the implementation of the savings plan that was announced at the beginning of October. In short, FrieslandCampina's costs are considerably too high in relation to turnover. Not long after taking office, CEO Jan Derck van Karnebeek decided that a major reorganization is needed to turn the tide. He speaks of a painful day that is necessary to win again in the market.
Everywhere in the organization
Of the 1.800 jobs that will be created, approximately 1.200 will have to disappear next year. This becomes visible throughout the organization. FrieslandCampina indicates that positions are disappearing worldwide in almost all parts of the company. It was previously indicated that middle management in particular would be affected. With a smaller workforce, the cooperative dairy group expects to realize barely half of the targeted €400 to €500 million in cost savings. The rest of the savings must come from working more efficiently, which does sound quite ambitious, given the size of the amount.
No additional payment
Some of the cost savings are necessary to offset inflation. The rest of the amount must benefit investment capacity and profitability. It is under pressure. It was previously announced that member dairy farmers will miss out on a supplementary payment this year. With an additional one-off charge of €170 million, FrieslandCampina will most likely write red figures for 2023, which has not occurred in the company's recent history. In the first half of this year, net profit amounted to a paltry €8 million.
The central business council of FrieslandCampina still has to approve the proposed decision.
Wouter Job
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