Heineken announces thousands of layoffs after the pandemic hit

the Hague. Dutch brewer Heineken announced today that it will eliminate about 8,000 jobs, Almost 10% of the workforce worldwide, as part of a cost reduction plan for the blow suffered in the pandemic, which reduced the volume of beer sales by 8% compared to 2019.

In presenting its annual results, the company explained that it will launch a plan of cuts for save around 2 billion euros gross by 2023 and expects to reduce its total costs with the layoffs to 350 million euros.

The company, which has about 85,000 people in its workforce in different countries, is not yet clear where it will cut these jobs, but estimates that its headquarters will be subject to a 20% reduction in labor costs. staff until the end of the first quarter of 2021.

The company’s results were seen hit by pandemic-related restrictions: The closure of bars and restaurants to ensure social distance, or the total ban on the sale of alcohol in some countries, which left a total revenue of 23.770 billion euros, 16.7% less than the previous year .

the the company’s net profit in 2020 was 1,154,000 euros, A drop of 49.4% compared to 2019, which the company was already expecting due to the restrictions applied in important markets, such as Mexico or Brazil, which have been severely affected by the pandemic.

In addition, the currency conversion negatively affected net income by 1,259,000 euros, 5.3%, driven mainly by the Brazilian real, the Mexican peso, the Nigerian naira, the Russian ruble and the South African rand. , details.

organizational redesign

“COVID-19 continues to have a material impact on our front-line performance, affecting all geographies and markets, as governments around the world took steps to mitigate the contagion, including restricted population movement, the social distancing, the closure of points of sale and the temporary closure of production facilities, “the company argued.

The company too will allocate about 420 million euros to the reorganization of the company, Which will also mean more efficient production of their beers, more frequent use of digital sales channels to reach their consumers and promoting premium brands and non-alcoholic beer, to the detriment of less effective products and expenses.

Executive Director Dolf van den Brink noted that the company aspires to “deliver superior and profitable growth in a rapidly changing world” and committed to “putting customers and the consumer at the center to continuously improve and expand” their presence, intensifying the “focus on continuous productivity improvements”.

The company also celebrated the reduction in water use thanks to a plan presented in March 2019. “Ten production points located in Mexico, Spain and Egypt resupplied more water in their respective watersheds than that used in the its end products through nature-based solutions and infrastructure improvement projects, ”he said.