Diageo is to cut 305 jobs at its North American headquarters in New York as the drinks group pushes ahead with CEO Sir Dave Lewis’ turnaround plans. <\/p>\n
The location and number of job cuts were confirmed by a WARN notice by the company, with the permanent layoffs effective from 30 September and the reason cited as “economic”. <\/p>\n
In a statement, a Diageo spokesperson said: “As we shared at the start of August, we have been redesigning our operating framework to deliver a more competitive Diageo. We understand that this is a difficult time for colleagues, and we remain committed to supporting everyone through these changes.” <\/p>\n
For the year to 30 June, the Captain Morgan rum distiller booked a 3% decline in reported net sales at $19.64bn. Organically, net sales dipped 2%. <\/p>\n
Its North America business, 37% of group sales, saw organic net sales fall by 8.4%. <\/p>\n
The cuts come after Lewis signalled at an investor day last month that North America would bear the brunt of the group’s restructuring, telling investors the region had been “underperforming for quite a while,” with growth in Tequila having “covered up some of that” underperformance. <\/p>\n
At the same event, the Tanqueray distiller said it is seeking around $1bn in savings<\/a> over three years, with about $850m expected to come from a “redesign” of its “operating framework”. <\/p>\n Speaking to reporters after outlining the savings plan, Lewis said: “Diageo had a programme which was investing ahead of growth”, adding the company needed to “right-size the business”.<\/a> <\/p>\n He also told reporters many of the planned changes were in areas such as “core finance functions, core technology functions, HR” rather than sales and marketing. <\/p>\n