Multinational steel manufacturing company ArcelorMittal South Africa said on Wednesday it was contemplating a large-scale restructuring exercise which might affect more than 2,000 jobs, citing a difficult domestic economic environment.
In a trading statement, the company said certain costs that were not within its control such as high electricity, rail, port and primary raw material costs had contributed to its challenges.
Although it had embarked on several initiatives to improve efficiencies and address expenditure within its control, these cost-saving initiatives would not be sufficient. More significant measures had become necessary, including the review of staffing levels.
“Shareholders are accordingly advised that the company will be commencing with a consultation process in terms of section 189(3) of the Labour Relations Act 66 of 1995. Large-Scale restructuring is contemplated, and it is anticipated that in excess of 2,000 positions (full-time equivalents) may be affected,” ArcelorMittal said.
“The final outcome and number of positions affected is subject to a formal consultation process.”
The steel manufacturer said it expected headline earnings for the six months ended June 30 to decrease by at least R650 million to a headline loss, resulting in a decrease in headline earnings per share by at least 59 cents.
It said the loss for the period would likely improve by at least R700 million or 44%, resulting in an improvement of the loss per share by at least 64 cents.
– African News Agency