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:hristian Salvesen cuts back
Page 5
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Christian Salvesen has ised four distribution cenas, warning that its full-year outs will fall short of expections as a result of problems the UK, Germany and Spain. Its loss-making German oration will bear the brunt the cutbacks, losing four pots and 200 staff—a guarof the German workforce. Salvesen also suffered a sharp fall in volumes over Christmas in the UK, where the car industry is a key customer. The low volumes in this sector are not expected to recover for the remainder of this financial year.
A spokesman for Salvesen says: "A number of areas of our industrial business have been Impacted by a downturn in volumes in December last year. There is no real sense of when volumes may pick up again. In Germany the businesses have under-performed for some lime."
The anticipated exceptional cost of this action plan is 17m, with a payback period of one to two years.
Profits as a percentage of total sales for Salvesen have fallen sharply in the past four years. In 1998 profit was 10% of sales, but in 2001 it had fallen to 3%. The group's level of debt doubled between 2000 and 2001, rising to £139.4m.
"The UK business is sound but it has been hit by a downturn in volumes, particularly over the past 3-4 months," the spokesman adds. "There are action plans in place for Germany and Spain and I cannot rule out further closures.