A number of factors have resulted in excess capacity in Campbell’s US thermal manufacturing network, including significant productivity improvements, volume declines of US canned soup and an increased focus on new packaging formats which are often produced under co-manufacturing agreements.
As a result, the company is taking the following actions:
Campbell anticipates that it will incur pre-tax costs of approximately $115m, most of which will be incurred in fiscal 2013. The programme will also require approximately $27m of capital spending. Campbell expects these actions, once fully implemented, will result in annual ongoing pre-tax savings of approximately $30m beginning in fiscal 2016, with fiscal 2014 savings of approximately $21m.
Source: Campbell Soup Company
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