Nestle has announced it is planning to cut down about 15 percent of its workforce in 21 African countries which may include Nigeria. According to Financial Times, the downsize is because it overestimated the rise of the middle class.
“We thought this would be the next Asia, but we have realised the middle class here in the region is extremely small and it is not really growing,” Cornel Krummenacher, chief executive for Nestlé’s equatorial Africa region, told the Financial Times in an interview. (goo.gl/a55Wy8)
He also said Nestle would be lucky to reach annual 10 percent growth in Africa in future years, and with the cuts, the company hoped to break even next year.
Nestle Nigeria reported a 51 percent fall in pretax profit to 3.48 billion naira ($17.51 million) in the first quarter. Nestle share price has been down 16 per cent YTD and closed trading Tuesday at N850