Heinz to reduce workforce
plants and reduce its workforce by 4 per cent, or nearly 2,000
employees, in an effort...
US Food maker H.J. Heinz Co. said on Thursday it is to close some plants and reduce its workforce by 4 per cent, or nearly 2,000 employees, in an effort to cut costs in its struggling pet food and tuna businesses. Pittsburgh-based Heinz, whose products include Heinz ketchup and relish, disclosed the cost-cutting moves along with a financial third-quarter earnings report that showed poor profit growth. The company had warned earlier this month of production cuts and lower earnings in the second half of its fiscal year. The company plans to close tuna operations in Puerto Rico, consolidate its North American canned pet food production to Bloomsburg, Pennsylvania, and sell some assets which it did not identify. The 1,900 planned job cuts will come mostly in Puerto Rico and Terminal Island, California. ``Heinz is taking aggressive action to improve earnings, to drive innovation in our leading brands and to increase theefficiency of our tuna and pet food operations,'' Chief Executive William Johnson said in a statement. Johnson was keen to stress that the company's leading businesses , such as ketchup, food service products and frozenfoods, continued to show rapid growth. Sales of its largest unit, ketchup, condiments and sauces, rose 3 per cent to $596.8 million in the quarter that ended on January 31. However, sales of Heinz pet products fell 12 per cent in the quarter to $287.6 million, or 13 percent of total sales of $2.27billion. The tuna business, affected by weak raw tuna pricing, fell 4 per cent to $228.1 million, or about 10 per cent of Heinz total. Heinz said it had earnings before special items of $227.4 million, or 65 cents a share, in the third quarter, compared with $227.2 million, or 63 cents, a year earlier.
