Heidelberg announces cuts of 2,500 jobs in profit warning

The German-based manufacturer has issued a profit warning saying that it expected a “significant downturn” in both sales and operating result for the current financial year, ending 31 March 2009, compared to the previous year.

It said the current financial crisis, coupled with movements in interest rates and its restructuring costs would lead to “a significant annual deficit in the current financial year”.

Heidelberg, which posted a pre-tax loss of €50m ($AU95m) in its first-quarter results, had previously announced plans to cut 500 jobs in order to save around €100m ($AU191m) annually by 2010/2011.

However, in light of the fall in sales and earnings for both the current and the next financial year, Heidelberg has announced plans to more than double the anticipated €75m ($AU143m) savings expected by 2009/2010 to between €150m ($AU286m) to €180m ($AU344m).

Further measures in the 2010/2011 financial year will then boost total savings to €200m ($AU382m) annually.

Heidelberg will implement a range of measures, beginning with shorter working hours in production, R&D and administration, in order to achieve its long-term goals.

The company, which has abandoned previously-announced plans to provide a quantitative forecast for its current financial year, said total restructuring costs could reach €150m ($AU286m).

Read the original article at www.printweek.com.

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