K-C cutting 1,600 jobs worldwide

DALLAS - Kimberly-Clark Corporation said it will reduce its worldwide salaried workforce by approximately 1,600 positions by the end of the year.

About 600 U.S. workers accepted severence packages in April, leaving about, 1,000 more worldwide to be cut by the end of the year, according to spokesman David Dickson.

It has not been determined how many could be cut at individual facilities, although none will be closed.

Kimberly-Clark employs about 3,500 people in Northeast Wisconsin.

The company cited "the challenging business environment" as the reason for the streamlining the organization, and accelerating its cost reduction programs, particularly for sourcing and supply chain activities.

It is expected that the organizational changes announced today will generate annualized pre-tax savings of about $150 million, further strengthening Kimberly-Clark's profitability and cash flow. Anticipated savings of approximately $60 million, or 10 cents per share, will benefit the company's results during the second half of 2009. Severance and related costs to streamline the organization will be recorded during the second, third and fourth quarters of the year, totaling $140 million to $150 million pre-tax, equivalent to about 25 cents per share. Approximately $110 million of the costs will be recorded in the second quarter.

"These actions, while difficult, are necessary to help us emerge from this demanding economic environment as a stronger company," said Tom Falk, Kimberly-Clark Chairman and CEO. "Through these changes we will be a more effective organization, with faster decision-making helping to drive efficiency throughout all aspects of our operations. In addition, by increasing our cash generation, we will be in a better position to take advantage of future growth and innovation opportunities."

Reductions in the workforce will come from all regions and business segments of Kimberly-Clark's global operations and will primarily affect salaried and non-production jobs.