About 130 workers at Frito-Lay Inc.'s Plano headquarters will lose their jobs this week as the snack maker's parent company rolls out a "productivity program."
PepsiCo Inc. said Tuesday it will shed about 3,300 positions globally. About 300 will be employees of Frito-Lay, the nation's largest snack maker. The cuts will amount to less than 1 percent of Frito-Lay's U.S. workforce of about 48,000.
PepsiCo also will close six plants, including one Frito-Lay plant in Canada.
"We're doing this to streamline the organization," said spokeswoman Aurora Gonzalez. "It's an opportunity to take those savings and invest in innovation and brand building."
PepsiCo, based in Purchase, N.Y., said in a news release that the cuts should yield "pre-tax savings of more than $1.2 billion over the next three years."
The company expects to have a pre-tax charge of up to $600 million in the current fourth quarter to cover the cost of the cutback.
Frito-Lay workers will learn their fates Thursday.
Al Carey, Frito-Lay's president and chief executive, told employees in a letter Tuesday that the decision to cut workers was made "only after careful analysis about how Frito-Lay can meet the changing realities of our future marketplace."
"Despite our outstanding productivity gains and strong revenue growth, the steps we've taken [already] won't be enough," he said. "We simply cannot absorb the rising economic pressures within our current structure."
This will be the second time in recent years that Frito-Lay has trimmed staff. The company cut 250 workers in 2005, mostly at Plano. Those were the first layoffs since 1991.
The upcoming layoffs were announced as PepsiCo released its third-quarter earnings, which were down from a year ago, due in part to slack beverage sales and higher costs.
Earnings dropped despite an 11 percent increase in revenue, to $11.24 billion, on increased sales of foods and snacks.
Earnings for the quarter ended Sept. 6 were $1.58 billion, down 9 percent from the $1.74 billion seen a year ago. That came out to 99 cents per share, down 6 percent from the $1.06 posted a year ago.
Excluding losses related to commodity hedges, earnings were $1.06 a share, the same as the third quarter in 2007.
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