Another blow for Geelong as Target cuts jobs
Target has confirmed jobs will be lost at its corporate support office in Geelong as it conducts a review of its operations, the Australian Services Union said.
ASU officials came out out of lengthy talks with Target executives on Friday to confirm the worst fears of its members and the city of Geelong, which has suffered a number of economic setbacks and job losses this year.
Ingrid Stitt of the ASU said Target had confirmed jobs would be lost from the 1000-strong staff at Target's headquarters in Geelong but no exact numbers were given. Target will see the union again on Tuesday.
It is possible Target, owned by the Wesfarmers conglomerate, might be able to nominate a redundancy figure next week as part of a sweeping review and restructure of its business.
Fairfax Media revealed on Wednesday that Target was reviewing its operations in the wake of a sharp downturn in its sales and profitability in the second half.
Staff cuts have already been made at its marketing department and speculation is mounting that as many as 200 more jobs might be carved out of the business in coming months.
The business review is being led by newly appointed chief Stuart Machin, Target's third head in two years. The retailer has been hit by excess inventory and a poor start to sales for the second half, exacerbated by the late start to winter.
Wesfarmers shocked investors two weeks ago with a profit downgrade for Target, flagging a potential second-half loss.
Chief executive Richard Goyder warned full-year earnings before interest and tax at Target would drop to between $140 million and $160 million, from $148 million in the first half. This could mean second-half earnings sinking to an $8 million loss or, at the upper end, a $12 million profit.
Wesfarmers also owns Kmart, Coles, Bunnings Warehouse and Officeworks.
The potential job losses at Target come at a tough time for Geelong.
Ford will pull out by 2016 with the loss of more than 500 jobs, and another 450 jobs are in doubt at Shell, which plans to sell its Geelong refinery next year.