Unilever plays down job cuts threat

Consumer products giant Unilever today distanced itself from reports that it was planning to shed thousands of management jobs.

The Anglo-Dutch group, which last week rocked the City with a profits warning, said it was not planning “a big cull” as part of moves to simplify its operations around the world.

Speculation that Unilever was preparing for major job cuts followed its announcement on Monday that it was accelerating a reorganisation of the company.

The group, whose products include Magnum ice cream, Lipton Ice Tea, Hellmann’s mayonnaise and Dove soap, took action after summer trading failed to meet expectations.

Poor weather was blamed for lowering demand for ice cream and iced tea, while weak consumer confidence affected the performance of many of its other key brands.

A company spokesman said today that the company was looking to trim its 250,000 global workforce through natural wastage and voluntary redundancy, although compulsory job losses had not been ruled out.

He said: “There isn’t a big cull. We are committed to a bottom-up rethink (of the management structure) and how should we do that rather than job losses per se.”

Unilever has made a string of disappointing updates that have called into question the merits of its five-year Path to Growth strategy, which was unveiled in late 1999 and involved focusing on key products and offloading non-core operations.

Chairman Niall FitzGerald, who will retire on Thursday, said at the time that the company was seeking 6% to 8% annual growth from its leading brands.

But its half-year results in July revealed sales to be flat, while last week’s update pointed to a further deterioration in trading with margins likely to be lower than a year earlier.

Unilever confirmed today that its SlimFast brand could be sold following a sharp decline in sales, primarily in the United States, where the craze for the low-carbohydrate Atkins Diet has eaten into its market share.

A report in the Sunday Telegraph said a deadline of six months had been set for sales of SlimFast to pick up or the brand will be sold.