Unilever, the multinational consumer goods company known for producing popular brands such as Ben & Jerry’s ice cream, Dove soaps, and Vaseline, has announced that it will be cutting 7,500 jobs and spinning off its ice cream business in an effort to reduce costs and increase profits. The decision comes as Unilever seeks to streamline its operations and focus on its core products.
The London-based company stated that its ice cream business, which includes brands like Magnum bars, has unique characteristics that could benefit from separate ownership to drive growth. The spin off is expected to be completed by the end of the next year. Additionally, Unilever revealed that it will be launching a productivity program that will result in the reduction of approximately 7,500 office-based jobs globally.
Unilever plans to invest in technology to improve efficiencies and eliminate redundant processes, aiming to save 800 million euros ($867 million) over the next three years. The company’s CEO, Hein Schumacher, expressed that the changes are essential for unlocking the full potential of the business and positioning Unilever as a leading consumer goods company with sustainable growth.
Following the announcement, Unilever’s shares rose by 3.6% in morning trading on the London Stock Exchange. Richard Hunter, head of markets for interactive investor, noted that the share price increase reflects investor optimism in the company’s restructuring efforts and future growth prospects.
Despite facing challenges in 2022, including a decrease in sales volume and price increases across its brands, Unilever is targeting mid-single digit sales growth after the spin off of its ice cream business. By refocusing on its core products and implementing cost-saving measures, the company aims to strengthen its position in the market and deliver enhanced profitability in the coming years.
