Johnson & Johnson, the maker of Aveeno skin care, Johnson’s baby products and Neutrogena cosmetics, is looking to save about $800 million to $900 million in 2010 with a reorganization. The plan will cut the pharmaceutical giant’s global workforce by 6 percent to 7 percent (about 7,000 employees) by reducing layers of management, and and simplifying business structures, the firm announced Tuesday.
This story first appeared in the November 4, 2009 issue of WWD. Subscribe Today.
“The company’s plans are expected to increase its operational efficiency and generate annualized, pretax cost savings of $1.4 billion to $1.7 billion when fully implemented in 2011,” the company stated. William C. Weldon, Johnson & Johnson chairman and chief executive officer, said, “Today, we are announcing a series of actions and plans designed to ensure that our company remains well-positioned and appropriately structured for sustainable, long-term growth in the health care industry.”
J&J will record an associated pretax, restructuring charge in the range of $1.1 billion to $1.3 billion in the fourth quarter of 2009, treated as a special item. The company also confirmed its earnings guidance for full-year 2009 of $4.54 to $4.59 per share, which excludes the impact of special items such as restructuring charges.