WesTrac cuts more jobs due to mining slumpOn 01/31/2019 by admin
Kerry Stokes’ mining services business WesTrac Australia is cutting at least another 100 jobs because of steep falls in commodity prices.
WesTrac, which supplies earthmoving equipment, continues to be hit by big miners cutting costs and delaying projects in response to weaker prices for iron ore, gold and thermal coal.
It is owned by Seven Group, which also owns other industrial services businesses, and a stake in Seven West Media.
Seven Group chief financial officer Richard Richards told the company’s annual general meeting that a “triple digit” reduction would be made to WesTrac’s fulltime workforce through redundancies, natural attrition and fewer contractors.
Seven Group cut the equivalent of 1,400 full time jobs across its industrial divisions in the 2013/14 financial year, including 863 at WesTrac.
“These measures alone have not been sufficient in view of continuing challenging market conditions,” Mr Richards said.
“In response to such challenging conditions, WesTrac Australia is taking immediate action now and in the coming months to continue to implement significant cost reductions and modification of work processes.”
The announcement follows news Orica would cut 700 jobs in the coming year, due to challenging conditions in the mining sector market for explosives and blasting systems.
Other mining services firms have also been cutting costs, while major job losses have also recently occurred in Queensland’s coal industry.
Seven Group has also cut its earnings forecast for the 2014/15 financial year, to a fall of between 10 and 15 per cent from the previous year’s underlying earnings of $374 million.
That forecast could be further downgraded if commodity prices continue to fall, Mr Richards said.
Seven Group shares were down 43.5 cents, or 6.7 per cent, at $6.065 at 1521 AEDT.
Shareholders also delivered a first strike against the company’s executive pay, which included a package worth $5.5 million for chief executive Don Voelte in his first year.
Just over 40 per cent of votes went against the pay structure, and a vote of more than 25 per cent against next year will result in a vote to oust some of the board.
Kerry Stokes, who holds a 69 per cent stake in Seven Group, is unable to vote on executive pay.