PepsiCo to Lay Off 3,300 Employees
PepsiCo, maker of Pepsi-Cola, Doritos, Sun Chips and owner of Frito-Lay, Tropicana and Quaker brands, plans a layoff of 3.300 workers worldwide as company profits drop.
The company said Tuesday it expects to generate a pretax savings of more than $1.2 billion over the next three years with $350 million to $400 million in 2009, designed to reinvigorate lagging sales of its soft drinks business in the U.S. Pepsi expects to report 2008 earnings per share of $3.67 to $3.68, compared with prior guidance of $3.72.
The company reported a net income of $1.58 billion, or 99 cents a share, in the quarter, compared with $1.74 billion, or $1.06 per share, a year earlier, on sales of $11.2 billion in the most recent period, compared with $10.17 billion a year ago.
Looks like PepsiCo will be re-focusing attention on their ol' standby: soda pop.
PepsiCo announced Friday it would renew its focus on carbonated soft drinks with a marketing campaign to be launched after New Year's. That would be a reversal of its strategy to move away from soda and toward more expensive alternatives, such as sparkling juice, energy drinks and ready-to-drink teas.
Goodman, the CFO, said the company had been planning the campaign over the last several months as a response to the consistent declines in sales volume in the U.S.
"We're looking at re-engaging consumers, keeping the ones we have and making sure we're getting additional consumers into the fold," Goodman said, adding that a lot of carbonated soft drinks "are very affordable."