Global banking major Citibank and US soft drinks conglomerate Pepsi has finally announced massive jobs cuts across the globe to cut down the costs and save the empires from the impact of global economy meltdown. Job cuts decision may hit these companies Indian operations, experts said.
Here is the Vikram Pandits Presentation at Town Hall meeting of Citi.citi-townhall-vikram-pandit-presentation
Vikram Pandit, Citigroup Chief Executive has made the jobe cut announcement at a meeting of employees in London. Citibank has already axed 23,000 jobs this year in an attempt to offset losses of about USD 20 billion. Citigroup, which has over 3 lakh employees, plans to cut 14% of its workforce.
Vikram Pandit-led financial services giant Citigroup today said it would cut more than 52,000 jobs in the coming months and reduce expenses by 20 per cent in 2009.
Citi today said it intended to reduce the total head count to less than 300,000 in the near term. The financial services leader had a workforce of 352,000 in the third quarter of 2008.
“The head count is expected to be down 20 per cent in the near term from peak levels,” the company said.
The bank, severely battered by the financial crisis, has suffered huge losses in recent quarters. In the third quarter, Citi had a loss of $2.8 billion.
In terms of expenses, the financial services firm aims to save $50-52 billion in 2009. “Expenses are expected to be down 20 per cent from peak levels,” the firm said.
Citi has lost $20.3 billion last year, and analysts expect it to lose money this quarter, while some believe it may not be profitable in 2009 as well.
However, Citi said underlying business remained strong and that revenues were stable.
At the end of the fourth quarter of 2007, the company’s head count stood at 3,75,000. In the first three quarters of this year, the company has reduced its workforce by about 23,000.
Citigroup has also axed several employees across businesses and management cadres in India.
Sources said, “Each country has to come up with its numbers. There have been redundancies where there is a duplication of job descriptions. Employees have been asked to go from different Citigroup entities in India. Some of them have got a golden handshake.”
Citigroup’s entities in India include Citibank NA, Citi Corp Finance Limited, Citigroup Global Markets, CitiFinancial, Citigroup private bank and Citigroup Technology Services. Citigroup has 11,000 employees in India.
Pandit became Citigroup chief executive last December, and has faced much criticism from investors and others for failing to implement a workable turnaround plan.
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The Pepsi Bottling Group Inc announced restructuring plans on Tuesday that would eliminate some 3,150 jobs and cut its forecast for full-year earnings due to weaker foreign currencies.
It said its multiyear restructuring plan should yield $150 million to $160 million in annualized pretax savings when completed, starting with savings of about $70 million in 2009.
In the United States and Canada, Pepsi Bottling said it would streamline its selling and service organization and supply chain infrastructure, moves that would affect about 750 jobs. Plans to close plants and distribution centers in Mexico would affect 2,200 jobs there.
Similar actions in Europe will affect about 200 jobs, the company said.
The company expects cumulative charges from the plan of $140 million to $170 million, with a charge of 27 cents to 32 cents per share expected in the fourth quarter of 2008.
Pepsi Bottling said it now expects earnings per share of
$2.20 to $2.26 for the full year, compared with a previous view of $2.32 to $2.38, due to foreign currency changes and a higher-than-expected interest cost on a recent bond issue.
Including its restructuring plan and an asset impairment charge, it forecast full-year earnings of 62 cents to 73 cents per share.
