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Wed October 28 2020

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Cost-cutting Keller plans redundancies

18 Nov 10 Ground engineering specialist is on another cost-cutting drive that will include redundancies. The company says that its business in the UK is continuing to struggle in “very weak market conditions”. Measures already taken this year to reduce overheads and operating costs have not yet gone far enough.

A statement to the stock exchange this morning said: “Management is implementing further cost reduction measures in its more difficult markets, which will result in a total of £3m of redundancy and other reorganisation costs in 2010, most of which will be incurred in the final quarter.   After taking account of these charges, the Board expects the 2010 full-year results to be around the bottom end of the current range of market expectations.”

Of its international operations, India, Poland and Australia are bright spots, while the USA, France and Spain are among the more difficult markets.

In the four months to the end of October, like-for-like revenue was in line with the same period last year.  This shows an improvement on the first six months, for which like-for-like revenue was down by 14% compared with the previous first half. This was blamed in part on weather conditions.  However, margins have remained under pressure in mature markets and “are not expected to begin to improve until such time as there is confidence in a sustained recovery in volumes”.

The improvement in contract awards that was reported in the first half of the year has been maintained and, as at the end of October, the order book was 7% ahead of the same time last year, compared with 1% at the end of June.  

With 2009 revenue of £1,038m, Keller is a member of the FTSE-250. It has around 6,000 staff world-wide, with offices in over 30 countries on five continents.

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MPU

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