MOSCOW (MRC) -- The Swiss specialty chemicals firm Clariant says it will cut up to 600 jobs to save money after a drop in profit in 2019. The firm expects the slow economic situation this year to continue to affect demand, said Snbchf.
"For 2020, given the current sluggish economic environment and continued adverse foreign exchange conditions, growth will be more limited and additional efficiency measures have been defined for each of the businesses to support the margin increase," the Basel-based firm said in a statement on Thursday.
The move towards more cost efficiency will translate into a workforce reduction of approximately 500 to 600 positions over the next two years which is expected to save approximately CHF50 million (a little over USD51 million).
The Muttenz-based group currently employs around 17,200 people around the world. The announced job cuts correspond to 3-3.5% of the workforce. It is unclear exactly where Clariant plans to make the job cuts.
Last year, net profit fell to CHF38 million from CHF356 million in 2018, Clariant said. This was partly due to money being set aside in the second quarter linked to an ongoing competition law investigation by the European Commission into the ethylene purchasing market.
Sales fell slightly to CHF4.39 billion from CHF4.4 billion, the company said. "The Group has significantly reshaped its portfolio through the divestment of Healthcare Packaging in 2019, the announced sale of Masterbatches and the planned divestment of Pigments in 2020," it said, outlining ongoing structural changes.
Clariant replaced its chief financial officer on Tuesday and is still hunting for a new chief executive officer after the previous head left suddenly last year.
As MRC informed earlier, Clariant announced that it has been awarded a contract by Dongguan Grand Resource Science & Technology Co. Ltd. to develop a new propane dehydrogenation unit in cooperation with CB&I. The Dongguan plant will be one of the largest single-train dehydrogenation units in the world. Clariant's technology partner CB&I will base the plant's design on its Catofin® catalytic dehydrogenation technology, which uses Clariant's tailor-made Catofin catalyst and Heat Generating Material (HGM).
Propylene is the main feedstock for producing polyprolypele (PP).
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).
Clariant AG is a Swiss chemical company and a world leader in the production of specialty chemicals for the textile, printing, mining and metallurgical industries. It is engaged in processing crude oil products in pigments, plastics and paints. Clariant India has local masterbatch production activities at Rania, Kalol and Nandesari (Gujarat) and Vashere (Maharashtra) sites in India.