ArcelorMittal South Africa Cuts 2,000 Jobs to Reduce Costs

This translates to almost a quarter of its total workforce of around 8,500 in the country.

SEATTLE (Scrap Monster): ArcelorMittal’s South African operations will see job cuts of nearly 2,000. The final number is subject to formal consultation. This translates to almost a quarter of its total workforce of around 8,500 in the country.

The move is considered part of its ongoing efforts to cut costs of operation. Incidentally, the company expects to report losses at its South African operations during the initial half of the current year.

The company statement noted that a large-scale restructuring of operations was very much on the cards, as the previous initiatives to reduce costs have proved insufficient. More significant measures along with other interventions have become necessary, it said. This will likely affect in excess of 2,000 positions.

ArcelorMittal noted that the South African steel industry faces significant challenges from the ongoing difficult domestic economic environment. Faltering economy in South Africa, high electricity, rail and port charges along with rising raw material costs have contributed to these challenges.

ALSO READ: ArcelorMittal Plans Massive Layoffs at Italian Steel Plant

The trading statement released by the company noted that the headline earnings for Jan-June ’19 are likely to decline by at least $45.78 million, thereby resulting in a loss. The earnings per share are likely to decrease by at least 59 cents. Incidentally, the steelmaker is scheduled to publish the H1 2019 results early next month.

The ArcelorMittal South African operations had come under financial pressure in 2015 also, whereby it received a bailout from the government.

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