PPG Industries Inc., an international maker of paint, chemicals and glass, said March 12 it will slash 2,500 jobs and close more facilities in a new cost-cutting effort designed to save an additional US$140 million a year.
PITTSBURGH
PPG Industries Inc., an international maker of paint, chemicals and glass, said March 12 it will slash 2,500 jobs and close more facilities in a new cost-cutting effort designed to save an additional US$140 million a year.
PPG plans to close a paint manufacturing operation in Saultain, France, and also shutter several smaller facilities while reducing staff generally across its operations.
Chairman and CEO Charles Bunch stated that the deepest cuts will occur in PPG’s automotive coatings and industrial coatings units, which have experience a steep drop in global demand since the economic downturn.
The planned actions are expected to save US$60 million before taxes this year and increase to an annual run rate of US$140 million after that.
Excluding the restructuring charges and other one-time items, the company now expects adjusted first-quarter earnings of 10 to 15 cents per share.
PPG said it may take an additional charge of up to US$50 million later this year once other elements of the restructuring are finalized.
In September, PPG announced it would close plants in Clarkson and Owen Sound in Ontario, with the loss of 320 jobs, and shut sites in the Netherlands and Illinois to save about $100 million by the end of 2009.
PPG said those previous actions are expected to reduce employment by 1,357 by the end of this year.
Its worldwide operations also include plants making glass, chemicals and coatings in Alliston, Hawkesbury, Oshawa, Toronto, Cambridge and Windsor in Ontario and Beauharnois in Quebec. The statement did not specify the impact on those sites, but Bunch said there will be “sweeping steps that will impact all of PPG’s business segments and regions.”
In addition, PPG is cutting capital spending by half and expects to lower pension contributions to about US$350 million this year from its previous estimate of US$500 million.
The company has also implemented other cost-cutting measures, including employee furloughs and pay reductions.
associated Press
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