Coca-Cola said on Thursday that it was cutting 1,600 to 1,800 jobs globally as part of $3 billion in costs it hopes to pare over the next several years.þþ“We do not take decisions about job impacts lightly,” the company said in a statement. “We have committed that we will ensure fair, equitable and compassionate treatment of our people throughout this process.”þþThe company said in the fall that it would cut jobs but did not say how many until Thursday. The company had 130,600 employees worldwide as of December 2013, the most recent figure available.þþSales of sugary soft drinks continue to decline as more health-conscious consumers adjust their eating and drinking preferences. As the industry leader, Coca-Cola has not made adjustments to its business until now, while PepsiCo and the Dr Pepper Snapple Group started making cuts a few years ago.þþIn the quarter that ended Sept. 30, net income fell 14 percent to $2.1 billion, or 48 cents a share, as sales of its flagship Coca-Cola portfolio dropped 3.5 percent.þþ“We continue to face a challenging macroeconomic environment, more challenging than was expected at the beginning of the year,” Muhtar Kent, chief executive of Coca-Cola, told investment analysts on a conference call in October.þþAli Dibadj, an investment analyst at Sanford C. Bernstein & Company, said the job cuts were about what he expected. “The employees that are leaving Coke were better paid than most of us had thought, which will result in lower number of heads but still meeting the dollar amount they wanted,” Mr. Dibadj said.þþWall Street has been pleased because Coke has not tried to address the falling sales of what it calls “sparkling” beverages by cutting prices. Instead, it has tinkered with packaging, giving consumers smaller soft drinks at higher prices, and reduced promotional activity.þþ“That’s been a good, positive change,” Mr. Dibadj said. “It’s a good change for the company because it maintains its profit margins and a good change for consumers, who are drinking less sugar.”þþWall Street has applauded the investments Coca-Cola made last year for minority stakes in Monster, the energy drink, and the coffee business Keurig Green Mountain, but those investments have yet to pay off.þþ“Share a Coke,” a marketing program that gave customers the opportunity to buy cans and bottles of Coke with their names printed on them, helped increase sales a bit, and investment analysts are eager to see how Coca-Cola Life, a new midcalorie soda, will do. Midcalorie sodas have been a tough sell, but Coke is promoting Life, which is made with sugar and stevia, as a “natural” soda, replacing classic Coca-Cola red with green on labels.þþ
Source: NY Times
