(RTTNews) - Thursday, materials science company Cookson Group PLC (CKSN.L: News ) said in an interim management statement that its underlying revenue was down around one-third for the first four months, compared to the same period a year ago, as major markets remained very weak. Further, the company said it intends to begin third phase of restructuring involving additional job reductions.

In the second half of the year, the company expects modest improvement in trading profitability, as further cost-reduction benefits materialize and sales volumes improve.

Nick Salmon, chief executive, said that through out the first four months of 2009, the Ceramics division's main end-market, global steel production, remained at December 2008's low levels, while the Electronics division witnessed progressive pick up in demand through March and April, particularly in Asia, following very low levels in January and February.

Given the continued weakness in ceramics end-markets, Cookson said it is initiating a third phase of restructuring. The first and second phase are estimated to generate around GBP 40 million of annualized savings, of which GBP 30 million will be realized in 2009.

Cookson added that the third phase could include the closure of further Ceramics facilities, in addition to the intended closure of six facilities already announced, resulting in further reduction in the division's headcount of up to 600. The third phase will cost approximately GBP 13 million, which the company intends to record as additional restructuring charge in fiscal 2009.
Total restructuring and integration costs for the full year is now expected to be approx. GBP 40 million, and cash outflow related to restructuring will be under GBP 50 million.

Additionally, Cookson expects the Group headcount to be around 3,200 lower by the end of 2009, compared to September 2008 period, a reduction of 19%, as a result of further restructuring and integration.

Cookson also said that it is expecting to be in full compliance with the financial covenants contained within its debt facilities as at 30 June 2009.

CKSN.L is trading at 23.00p, up 1.25p or 5.75%, on a volume of about 21.85 million shares.

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by RTT Staff Writer

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