Danone relies on an austerity program


The French food giant wants to position itself much leaner.

(Photo: Reuters)

Paris The French food giant Danone reacts to the corona crisis with job cuts and corporate restructuring. The company also adjusted its medium-term forecasts. By 2023, they want to save up to one billion euros in annual costs, including by cutting up to 2,000 administrative jobs, Danone announced on Monday in Paris.

In the corporate headquarters alone, up to a quarter of the jobs could be lost. The group put the cost of the renovation between 2021 and 2023 at around 1.4 billion euros.

In the medium term, the management around CEO Emmanuel Faber is now assuming an operating margin in the mid to high tens percent range due to the savings efforts. The first milestone is planned for 2022, for which a value over 15 percent is expected. Danone confirmed the medium-term outlook for sales growth of 3 to 5 percent on a comparable basis. When looking to 2020, Faber is sticking to its previous goal.

The global pandemic has accelerated some aspects of the upheaval in the food sector and changed others, said Faber. Therefore, Danone wants to align its structure more strongly to geographical regions than to product categories in order to be able to react more agile.

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