Henkel cuts 3000 jobs despite record profit,
cosmetics grow by 5.8%
The cosmetics, detergent and adhesive manufacturer plans to make widespread job cuts – despite record profits. By 2011 some 3000 of the 53.000 jobs worldwide are to be axed, the company reported. The savings programme is Henkel’s reaction to growing pressure from competitors and the rising cost of raw materials.
“We (..) guarantee the firm’s sustainability from a position of strength”, said outgoing company CEO Ulrich Lehner. The Company reports that it was earmarking around € 500 million for investment in this year’s worldwide programme. From 2011 the measures are then set to make an annual saving of about € 150 million. The job cuts are to be made in a “socially compatible” way, promised Lehner. Henkel’s savings programme was introduced as early as 2004, resulting in some 2500 job losses. The rising cost of raw materials had been worrying the manufacturers of Schwarzkopf, Fa, Dial, Pritt, Pattex and Persil for months. On top of this, rivals like Procter & Gamble or L’Oreal operate more profitably than the Düsseldorf group. Henkel is therefore trying to boost the operating margins to 12%