International Flavors & Fragrances Inc. (IFF) announced a strategic initiative designed to strengthen the its global go-to-market capabilities, as well as improve profitability. The initiative includes a realignment of responsibilities in the fragrance business unit under its group president, Nicolas Mirzayantz, and a reduction in workforce in fragrances as well as in various other parts of the organization.
The fragrance business unit will reorganize its functional fragrances group to align with the global category approach used for fine fragrance and beauty care and for fragrance ingredients. IFF will also continue to reallocate a portion of its functional fragrance resources from the developed markets to the emerging markets, increasing emphasis on its Singapore and Mexico creative centers.
“This realignment completes the roll-out of our full category structure within the fragrance business unit,” said Mirzayantz. “We believe this will strengthen our expertise and ability to win in key categories and key markets while simultaneously simplifying our decision-making process, improving resource allocation, and enhancing collaboration, as we continue to deliver consumer-preferred fragrances to our customers.”
“Today’s announcement highlights our commitment to the plan that was developed in our strategic review,” said Doug Tough, IFF’s chairman and CEO. “These changes are expected to provide improved business fundamentals that, when combined with our strategy to leverage our geographic reach, strengthen our innovation platform and maximize our portfolio, should create long-term value for our shareholders.”
In the fourth quarter of 2011, IFF will record a pre-tax charge of approximately $10 million, or $0.08 per diluted share after-tax associated with the elimination of approximately 70 positions globally, which is for severance and other employee-related costs.