TreeHouse Foods Reorganizes Business To 'Further Create Value For Customers'

Private label packaged foods and beverages maker TreeHouse Foods Inc. THS announced this week a reorganization of its business to "further create value for customers."

What Happened

TreeHouse said it will transform its leadership team from three divisions that are structured according to product category to two divisions which will be organized according to market dynamics.

The first of the new units is Snacking & Beverages and will consist of categories that show greater growth potential in the marketplace.

Management's main focus will be on revenue growth along research and development so it can better adapt to evolving consumer trends.

The second unit will be called Meal Preparation and consist of categories like Bouillon, Single Serve Coffee, Sauces, among others. Management's top priority will be on improving productivity, efficiency, and cash flow.

See Also: FTC Challenges Post's $110M Acquisition Of TreeHouse's Cereal Business

Why It's Important

TreeHouse Foods CEO and President Steve Oakland said in the press release the change in its structure should address two main goals. First, the company wants to better demonstrate value to the consumer while simultaneously improving its own margins. Second, to better stand out in the competitive food landscape.

"Our reorganization not only enables us to align our resources to help our customers achieve their goals, but it also better positions us for growth going forward," he said.

Transition expenses will come from the company's existing 2020 restructuring program. As such, the cash restructuring expenses along with savings from SGA expenses have already been factored into management's full-year 2020 guidance which was released on Feb. 13.

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