Danone, the company behind Activia yogurts and Evian water, today revealed plans to cut 900 jobs across Europe.
The French food giant said it needed to lower costs to offset a “significant decline” in sales across the troubled region.
The job losses are likely to be spread over a two-year period, across 26 European countries, including the UK, and focus on management and administrative positions.
Danone is highly exposed to Europe, where it generates about 38% of its revenue. Last year, the company saw sales rise 5.4% to €20.8 billion (£17.9 billion) boosting its shares during early trading.
However, analysts warned that economic headwinds in countries such as Spain were likely to pose a significant challenge for the group over the next few months.
Franck Riboud, Danone’s chairman, said: “Some of our business in Europe came under pressure from a severe deterioration in overall consumer demand, which led to a 3 per cent decline in our net revenues in this region and a decline of over 10 per cent in our operating income.
“Clearly this situation is not sustainable, and we will overcome it … 2013 will be a year of transition. A year aimed at returning our activities as a whole to strong, profitable growth by 2014.”
Danone has been under pressure to cut costs and return to cash to shareholders.
Activist investor Nelson Peltz, who has previously agitated for change at United States companies such as Heinz and Wendy’s, built a 1% stake in the group last year and has already warned it not to make costly acquisitions.
