Newell Rubbermaid Gets Facelift, Slashes Jobs
Radical changes are in store at Newell Rubbermaid (NYSE:NWL), the company known for its Sharpie markers and iconic namesake storage containers.
A corporate restructuring overhaul, which the consumer products maker is terming “Project Renewal,” will reorganize the company under two groups and result in the shedding of over 1,900 jobs.
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Times are good at the Atlanta, Georgia-based company, and leadership hopes the organizational changes will foster continued growth in the future. Newell Rubbermaid reported third-quarter adjusted results that beat analysts’ predictions and raised its dividend 50 percent to 15 cents per share.
The quarter saw earnings of $108.3 million, or 37 cents per share, representing a rather remarkable turnaround from losses of $177.6 million, or 61 cents per share, in the same quarter just one year ago.
As a result, Newell Rubbermaid shares shot up over 4 percent Friday, near a 4-year high.
The job cuts, which will equal nearly 10 percent of the company’s global workforce, will take place over the coming two-and-a-half years, and the money saved will be poured into increasing sales capabilities in emerging markets and growing global brand recognition.
Restructuring the company into two divisions – a development organization and a delivery organization – is expected to cost Newell Rubbermaid some $250 million to $275 million, and has already resulted in a slew of senior management and executive changes. However, once the reorganization is complete by the end of 2015’s fiscal second quarter, the company anticipates it will enjoy annual savings of $180 million to $225 million.
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