The analyst’s executive director Graham Jones said Unilever planned “cost savings [which] include 2,000 job losses”, after attending the investor presentation, themed ‘Navigating the new world’.
But a Unilever spokeswoman told FoodManufacture.co.uk today (December 6) that the firm planned a 12% reduction in its marketing workforce of about 7,000 – amounting to 840 jobs.
The cuts were designed to control costs in a bid to mitigate slowing growth in emerging markets. The marketing activities earmarked for job cuts were: marketing processes, marketing insight, category and brand strategy, brand marketing plans, innovation/renovation, communications and in-brand management, execution, tracking and optimisation.
Unilever’s marketing teams serving developed countries are expected to bear the brunt of the cuts, as the firm introduced more team working around the globe.
Unveiling the cuts, Unilever’s chief marketing officer Keith Weed said the firm planned to cut agency and production fees to about 20% of the total marketing budget.
The Flora manufacturer also plans to cut the total number of product variants by about 30% before the end of next year.
‘Its problem area of spreads’
Meanwhile, Jones said much of the investor day was dedicated to the “typically impressive” personal care brand range but he was disappointed by the lack of attention to “its problem area of spreads”.
“We were disappointed that only about 10 minutes was given to the problem child of spreads, despite this being a key issue which is holding Unilever back,” said Jones.
“As such, we find it difficult to come away thinking that Unilever’s good growth in personal care would translate better into group performance in 2014E, although it’s difficult to see spreads not improving somewhat from a lousy 2013.”
Jones said Unilever dedicated three and a half hours to discussing its personal care business, “obviously the star of its portfolio”. Despite the slower category growth rates at present, the presentation reassured the analyst that its brand initiatives for 2014 would help the firm to continue to out-perform despite tougher competition.
Panmure Gordon revised its earnings per share forecast down by 0.6% to €1.51 and its 2014 forecast by 1.9% to €1.54.
Key Unilever brands include Knorr, Magnum and Hellmann’s together with personal care products Dove, Lux, Surf and Axe.