By Martin Baccardax for The Street
3M has said that it will eliminate around 2 900 jobs next year, while pulling back on investments in slower-growth markets, as part of an overall cost-cutting plant that will cost around $300-million.
3M said the updated restructuring plans, which were first launched in January, will affect all of its business divisions and geographies include a pre-tax charge of between $250 to $300 million, around $150 million of which will be taken in the current quarter. The moves will likely result in annual pre-tax savings of between $200 million to $250 million each year, 3M said, as it re-positions its global operations in the wake of the global coronavirus pandemic.
3M will detail the restructuring plans at an industry conference hosted by Credit Suisse later today, with CEO Mike Roman scheduled to speak at 8:10 Eastern time.
“The COVID-19 pandemic has advanced the pace of change and disrupted end markets around the world, increasing the need for companies to adapt faster,” Roman said.
“At the same time, we are seeing significant opportunities from our new operating model which we launched at the start of the year. As a result, we are taking further actions to streamline our operations, positioning us to deliver greater growth and productivity as global markets emerge from the pandemic.”
3M shares were marked 0.23% lower in early trading Thursday to change hands at $171.50 each to clip their six-month gain to around 6.5%, well shy of the 13.6% gain for the Dow Jones Industrial Average benchmark.
Last month, 3M posted modestly slower-than-expected October sale growth figures Friday, suggesting a potentially sluggish start to the fourth quarter for the industrial group.
3M said October sales rose 3% from last year to $2.9 billion as healthcare revenues rose 12%, offsetting a 4% decline in transportation and electronics. Safety and industrial sales rose 4% while consumer sales were 7% higher, 3M said, compared to respective gains of 6% and 3% in August.
3M had forecast “flat to low single digit” October sales growth during its third quarter earnings conference call with investors last month, but declined to provide profit or revenue guidance for the final three months of the year owning to broader economic and demand uncertainty linked to the coronavirus pandemic.
Retailer Massmart says it has started a consultation process under Section 189 of the Labour Relations Act that may affect 1 800 employees at Game stores in South Africa.
In a short update to shareholders on Tuesday, Massmart said the decision came after it “recently completed an assessment of opportunities to improve our South African Game store efficiencies”.
Section 189 of the act governs, among other things, the procedures that companies must be take ahead of any possible retrenchments.
In addition to Game, Massmart owns Makro, Dion Wired, Builders Warehouse and Masscash.
By Nathaniel Meyersohn for CNN
3M, which makes Post-It notes and Scotch tape, is cutting 2 000 jobs around the world.
The industrial manufacturer made the announcement Thursday as it reported weak sales during its most recent quarter and darkened its outlook for the year ahead.
Sales slid 5% to $7.9 billion last quarter compared to the same time period a year ago. Although sales ticked up in the United States, 3M’s largest region, sales dropped more than 9% in Europe, the Middle East and Africa. Those areas make up 3M’s second largest region. Sales in Asia also fell more than 7% compared to a year ago.
“The first quarter was a disappointing start to the year for 3M,” said Mike Roman, 3M chief executive officer, in a statement. “We continued to face slowing conditions in key end markets.”
In addition, 3M slashed its full-year guidance.
3M said the job cuts, which represent around 2% of its global workforce, will save the company up to $250 million annually. 3M will spread out the cuts across different business divisions and geographies “with emphasis on corporate structure and underperforming areas.”
The stock sank more than 10% in early trading Thursday, which drove down the Dow.
By Chris Forrester for Advanced Television
According to a report in South Africa’s Sunday Times newspaper, pay-TV operator DStv is laying off up to 200 staffers in a move to save cash amidst increased competition.
A DStv spokesperson said the move was in order to create a leaner and more agile business. Existing staff are being asked to reapply for their jobs, says the newspaper.
DStv’s parent, MultiChoice has lost some 41,000 Premium top-tier subscribers in the year to March 31st.
MultiChoice has made no secret of its annoyance that rivals such as Netflix and Amazon Prime are eating away at its core subscribers and yet operate without having to fulfil the licensing obligations faced by MultiChoice.
MultiChoice CEO Calvo Mawela has called for a change in regulations to cover the new OTT entrants.
By Dion Weisler for CNBC
HP now expects 4 500 to 5 000 employees to leave the company by the end of fiscal 2019 as part of an ongoing restructuring plan, the PC maker said on Tuesday.
In October 2016, HP’s board had approved a restructuring plan to be implemented through fiscal year 2019, under which it had expected around 4,000 job cuts. In May, the company said it expected that number to increase by 1 to 2 percent.
The company employed 49,000 people as of October 31.
HP, formed in 2015 when the then Hewlett-Packard Co was spilt into two, said in a regulatory filing. It now expects pretax charges of about $700 million related to the layoffs, compared with about $500 million forecast earlier.
HP estimates that about half of the expected pretax costs will relate to severance and the remaining costs due to infrastructure, non-labor actions, and other charges.
When Hewlett-Packard Co split up, HP Inc focused on the consumer-facing hardware business, including sales of PCs and printers, while Hewlett Packard Enterprise co-hosted the company’s data-center, software and services units.
HP, which has the top position in worldwide PC shipments in the first calendar quarter of 2018 with a 22.6 percent market share, reported better-than-expected quarterly sales of $14 billion in the quarter ended April 30.
Ricoh plans to cut about 4,000 jobs as early as fiscal year 2019 to streamline its struggling, core office-equipment business, the Nikkei reported on Thursday.
The company will let go off 3 000 employees through a sale of a logistics unit in Japan and trim management positions in Europe — reducing its global workforce by 4 percent, the Japanese daily said.
Ricoh and legacy companies that supply office printing equipment such as Xerox Corp have been looking to sell assets and focus on other areas of growth as paper printing increasingly gives way to digital alternatives.
Earlier this year, Japan’s Fujifilm Holdings said it would buy Xerox in a $6.1 billion deal to gain scale and cut costs. That proposal has, however, hit road blocks as two of Xerox’s top shareholders — Carl Icahn and Darwin Deason — opposed the deal.
Ricoh, meanwhile, has already cut over 5,000 jobs in North America since beginning of this year, the Nikkei said.
The 59-year old company has reported declining profits for the past four years. Its stock has shed nearly two-thirds of its market value since its peak in 2007.
Ricoh did not immediately respond to a request for comment outside regular business hours.
The Nikkei said last month that Ricoh was conducting impairment tests on its slumping North American business, and may have to take a related charge of about 100 billion yen ($943.04 million).
The company will sell a copier factory in the Chinese industrial hub Shenzhen and is planning to dispose of its equity stake in a Coca-Cola distributor for about 56 billion yen ($528.50 million), the Japanese business daily reported on Thursday.
Expenses related to the job cuts and other restructuring efforts are expected to weigh on the company’s fiscal 2018 performance, the Nikkei reported.
Ricoh will also set aside 200-billion yen for acquisitions of commercial and industrial printing companies as it looks to move away from office printing, according to the report.
Source: Japan Today