Hershey expects to cut 15 per cent of global workforce
NEW YORK (AP):
Hershey says it expects to cut its global workforce by about 15 per cent, with the reductions coming mostly from hourly employees outside the United States.
The Pennsylvania-based maker of Reese's, Kit Kat and Twizzlers also cut its long-term sales growth forecast to between two per cent and four per cent, down from the previous three per cent to five per cent. Hershey, which gets the majority of its revenue from North America, attributed the lowered expectations to "changes in US shopping habits" and challenges overseas.
The job cuts, which could come to about 2,700 workers, are part of Hershey's plan to improve its operating profit margin over the next three years, and the company said it will share more details on the measures in the future. Other major packaged food makers, including Coca-Cola Co, General Mills Inc and Kellogg Co, have been slashing costs as sales growth has slowed.
During a meeting with analysts in New York yesterday, Hershey CEO Michele Buck noted that the chocolate and candy category is nevertheless well positioned because it is "highly impulsive" with "expandable consumption". And she noted that the company plans to benefit from the snacking trend in the US that has people eating more frequently throughout the day.