Del Monte Foods Co. announced today it will trim about 85 jobs, or 7 percent of its total workforce, as part of a transformation plan to trim management layers, improve efficiency and boost overall profitability.
The job cuts, which will come in a mix of layoffs and attrition, will be split almost equally between the company's San Francisco headquarters and its Pittsburgh regional operation, which will continue to employ about 550 people. Affected employees have been notified, a company spokeswoman said.
Del Monte's plans to streamline operations came as the company reported fourth quarter profit of $57.9 million, almost triple the $19.3 million during the same period last year. Earnings per share of 29 cents, compared to 9 cents last year, beat the Thomson Financial Network's consensus analyst estimate of 20 cents for the three months ended April 30.
Both quarters' results were affected by special, one-time events. This spring, Del Monte sold off its infant feeding and private label soup businesses, including a plant on the North Side. Last spring, Del Monte was hit with costs involving refinancing and pet food litigation.
Total sales for the fourth quarter were $799.2 million vs. $774.4 million last year, a 3.2 percent increase.
For the full year for continuing operations, Del Monte reported net income of $169.9 million, or 83 cents per share, compared to $117.9 million, or 56 cents last year. Total sales were $2.998 billion compared to $2.899 billion last year.
Following the divestitures and the announced acquisitions of the Meow Mix and Milk-Bone pet lines, Del Monte said it is raising its long-term growth targets. The company hopes to produce sales growth of 3 to 5 percent, and earnings per share growth between 7 and 9 percent.
The company also said Todd R. Lachman, executive vice president, Del Monte Foods, had left the company earlier this week.