Dutch dairy cooperative FrieslandCampina plans to cut over 1,800 jobs across the organisation over the next two years as part of its cost savings plans.
Out of the total, around 1,200 jobs will be cut next year, FrieslandCampina added.
Commenting on the announcement, CEO of Royal FrieslandCampina N.V., Jan Derck van Karnebeek stated, "Over the past period, we have analysed the cost structure of our organisation and we are now announcing difficult but necessary steps to structurally reduce our costs. We realise that the announcement of job losses will have a big impact on the people involved.
"We will therefore do our utmost to inform and assist everyone as best as possible during this difficult time. These cost savings should contribute to FrieslandCampina's ability to compete and win in the market for the benefit of our employees and member dairy farmers.”
All proposed decisions are subject to Central Works Council advice and local laws and regulations, the dairy giant added.
Cost Savings Strategy
In October of this year, FrieslandCampina said it is seeking to achieve annual cost savings in the range of €400 million to €500 million from 2026, by implementing a new business strategy, which includes savings of €180 to €200 million from job reductions.
A part of the annual savings will be used to offset inflation, while the remaining will be equally divided between investments in sustainable growth and increasing the company’s net profit.
The dairy firm added that to realise the savings, one-off costs of up to €170 million will be booked in 2023.
It will also make no supplementary cash payment to member dairy farmers over 2023.
In July, FrieslandCampina reported a 85.7% year-on-year drop in operating profit, to €47 million, in the first half of its financial year.