Plus   Neg

Kier Group To Cut 1200 Jobs, To Sell Certain Businesses; Stock Up

Construction, services and property group Kier Group Plc (KIE.L) announced Monday that it plans to cut around 1200 jobs and to sell non-core activities such as Kier Living, Property, Facilities Management and Environmental Services. The decisions are taken as part of its strategic review led by Chief Executive Andrew Davies.

Through the steps, the company expects to deliver annual cost savings of about 55 million pounds from fiscal 2021.

The strategic review aimed to further simplify the company, better allocate capital resources and identify additional steps to improve cash generation and reduce leverage.

Kier said its businesses, mainly Regional Building, Infrastructure, Utilities and Highways, are expected to deliver long-term, sustainable revenues and margins. These will be the core activities of the company in the future with a renewed focus on their inherently cash generative characteristics.

Kier announced a new strategy that will focus on Regional Building, Infrastructure, Utilities and Highways; and simplify its portfolio. This is through selling or substantially exiting non-core activities, such as Kier Living, Property, Facilities Management and Environmental Services.

The company further plans to fundamentally restructure to reduce headcount by about 1,200. As a result of the Future Proofing Kier programme, about 1,200 full time employees have left or will leave the Group. Under the accelerated programme, about 650 FTEs will have left the Group by 30 June 2019 and an additional c.550 FTEs are expected to leave during FY2020.

The Board has concluded that Kier's Facilities Management and Environmental Services businesses have limited operational synergies with Kier's core businesses. Kier will seek to exit these businesses in due course.

Further, the Board has concluded that Kier's Housing Maintenance and Middle East construction businesses will be retained.

The Board considers that the revised strategy, together with the related actions which are now underway, will reduce its net debt significantly during FY2020.

The Board is suspending dividend payments for FY2019 and FY2020. The Board will continue to review dividend policy for future financial periods.

In London, Kier Group shares were gaining around 3.8 percent to trade at 135.72 pence.

For comments and feedback contact: editorial@rttnews.com

Business News

Editors Pick
Whole Foods Market stores have recalled Decorated Red Apple Cookies as they may contain undeclared egg. People who have an allergy or severe sensitivity to these allergens run the risk of serious or life-threatening allergic reaction if they consume these products. The cookies were sold by the... Norwex has announced voluntary recall of about 58,000 rubber brooms due to laceration hazard. According to the company, handles of the recalled brooms can break in half, exposing a metal inner rim, posing a laceration hazard to the user. The recall involves extendable indoor/outdoor white rubber... Amazon.com Inc. has expanded its AmazonFresh grocery delivery service to three new cities. Beginning today, Amazon Prime members in Houston, Minneapolis and Phoenix can shop thousands of products, ranging from meat and seafood to fresh produce and everyday essentials. The groceries will be delivered to their homes in two hours or less, with options for one-hour and two-hour delivery.
Follow RTT