Kumba Iron Ore has started parting ways with some of its workers as it gears itself up for a restructuring process aimed at culling close to 4 000 jobs.
"We had a restructuring at head office, we had a restructuring in support services and now we are having a restructuring of the Kumba Sishen core operations," chief executive Norman Mbazima said on the sidelines of the annual results presentation in Johannesburg.
The mining giant said recently announced plans to cut 1300 jobs indirect jobs and 2600 direct jobs.
Mbazima said the additional 1300 jobs would be from contractors who provide services to Sishen. He said the off-loading of workers was part of cost-cutting measures.
"We've got three major mining contractors at Sishen. We expect jobs to be affected at each of these companies," he said.
Kumba last year dealt the economy of Thabazimbi a blow when it instituted a process to close its 80-year-old mine - which was the town's cash cow. This had a negative impact on 800 jobs and 350 service providers.
"In March or April we expect all processing activities at Thabazimbi to cease. We will then be left with a skeleton crew," Mbazima said.
The company's restructuring process had, however, failed to contribute positively to the company's headline earning per share, which plummeted by 66% to R11.82 per share. Mbazima said the restructuring process had started to impact positively on the balance sheet but the challenge was that the company was losing revenue it could have got had it still been mining in Thabazimbi.
"During the year the group took significant steps to protect its balance sheet by preserving capital and reducing costs.
"A key area of focus was moving from a volume to a value-based strategy by reconfiguring the mines to reduce the amount of waste mined and to save costs in operational areas," he said.
Mbazima said the company was focusing on savings on overheads, study costs and head count rationalisation to deliver savings of R900-million. The results showed that the group's total revenue fell by 24% to R36.1-billion. He said the fall was partly due to a drop in average iron ore prices offset to an extent by the weaker rand/US dollar exchange rate.
sibanyonim@sowetan.co.za
Kumba sheds jobs as revenue falls
Kumba Iron Ore has started parting ways with some of its workers as it gears itself up for a restructuring process aimed at culling close to 4 000 jobs.
"We had a restructuring at head office, we had a restructuring in support services and now we are having a restructuring of the Kumba Sishen core operations," chief executive Norman Mbazima said on the sidelines of the annual results presentation in Johannesburg.
The mining giant said recently announced plans to cut 1300 jobs indirect jobs and 2600 direct jobs.
Mbazima said the additional 1300 jobs would be from contractors who provide services to Sishen. He said the off-loading of workers was part of cost-cutting measures.
"We've got three major mining contractors at Sishen. We expect jobs to be affected at each of these companies," he said.
Kumba last year dealt the economy of Thabazimbi a blow when it instituted a process to close its 80-year-old mine - which was the town's cash cow. This had a negative impact on 800 jobs and 350 service providers.
"In March or April we expect all processing activities at Thabazimbi to cease. We will then be left with a skeleton crew," Mbazima said.
The company's restructuring process had, however, failed to contribute positively to the company's headline earning per share, which plummeted by 66% to R11.82 per share. Mbazima said the restructuring process had started to impact positively on the balance sheet but the challenge was that the company was losing revenue it could have got had it still been mining in Thabazimbi.
"During the year the group took significant steps to protect its balance sheet by preserving capital and reducing costs.
"A key area of focus was moving from a volume to a value-based strategy by reconfiguring the mines to reduce the amount of waste mined and to save costs in operational areas," he said.
Mbazima said the company was focusing on savings on overheads, study costs and head count rationalisation to deliver savings of R900-million. The results showed that the group's total revenue fell by 24% to R36.1-billion. He said the fall was partly due to a drop in average iron ore prices offset to an extent by the weaker rand/US dollar exchange rate.
sibanyonim@sowetan.co.za
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