Sector News

Covestro to cut up to 10% jobs globally in cost saving plan

September 5, 2021
Chemical Value Chain

Covestro is to reduce its 16,500-strong workforce by up to 10% as the German chemicals major seeks to save costs, a spokesperson told ICIS on Friday.

It added the job cuts would include redundancies and early retirements.

Covestro employed 16,501 people as of 31 December 2020, already a lower figure than the 17,201 workers it employed by the end of 2019.

The total workforce could be cut by up to 1,700 jobs, said the spokesperson; around 950 of the positions would go in its home market of Germany.

The spokesperson said a final decision on numbers has yet to be taken.

It added the company was already in consultations with trade unions in Germany and other countries about the cost cutting plan.

Covestro produces polyurethanes (PU), polycarbonates (PC), coatings and adhesives, among other petrochemicals-intensive materials.

EARNINGS BOOM
Covestro’s profitability has boomed in the past months; in April, it upgraded its earnings forecast for the year, which was again upgraded in July.

The company said earnings would be higher due to healthier-than-expected profit margins as well as the positive effect from the acquisition of Netherlands’ producer DSM’s resins and functional materials division, closed in April.

Covestro expects its earnings before interest, taxes, depreciation, and amortisation (EBITDA), a key metric to measure a company’s financial strength, at €2.7-3.1bn in 2021, up from €1.47bn in 2020.

In an interview with ICIS, its CEO Markus Steilemann said earlier in August the booming business environment is set to persist for a few more months.

On Friday, however, the spokesperson said that while business is currently booming “that situation will not last forever” and the company needed to be financially sound for when that happens.

“We need to make sure that we look at costs structures at all times,” it added.

By Jonathan Lopez

Source: isis.com

comments closed

Related News

January 23, 2022

Eastman invests US$1B in world’s largest molecular plastics recycling facility in France

Chemical Value Chain

Eastman is investing up to US$1 billion in building what it says is the world’s largest molecular plastics recycling facility in France. The new facility would use Eastman’s polyester renewal technology to recycle up to 160,000 metric tons of hard-to-recycle plastic waste annually – enough plastic waste to fill Stade de France national football stadium 2.5 times.

January 23, 2022

LG Energy Solution opens books for South Korea’s largest IPO at up to $10.8 bln

Chemical Value Chain

Korean battery maker LG Energy Solution has opened the books to investors to raise up to $10.8 billion in the country’s largest initial public offering (IPO), according to a term sheet seen by Reuters. The shares will be sold in a price range of 257,000 won to 300,000 won ($216.19-$252.36) apiece to raise between $9.2 billion and $10.8 billion, the term sheet showed.

January 23, 2022

SHYNE, the largest consortium to promote renewable hydrogen in Spain, is born

Chemical Value Chain

The SHYNE (Spanish Hydrogen Network) project is the largest multisectoral consortium in Spain, created to promote the decarbonization of the economy through renewable hydrogen. SHYNE will have a total investment of €3.23 billion euros that will serve to develop more competitive technologies and evolve both the Spanish industry and its infrastructure towards decarbonization, generating more than 13,000 jobs.

Send this to a friend