Outokumpu plans restructuring measures for cost savings and starts employee negotiations

Outokumpu plans restructuring measures for cost savings and starts employee negotiations

Outokumpu is starting employee negotiation processes in selected operating countries with the plan to create cost savings by restructuring and reducing total employee headcount by up to approximately 1,000 (10% of the Group total) mostly by the end of 2021. Due to the challenging market situation with continuing high import pressure in Europe and the COVID-19 pandemic impacting the global economy, it is crucial to ensure the company’s cost competitiveness by reducing fixed costs, of which personnel expenses are significant part.

The negotiations will be initiated immediately in accordance to local legislation and other requirements in all the respective countries. The employee reductions are planned to be 270 in Finland, 250 in Germany and 190 in Sweden, with further reductions planned across the European and Americas based operations. Outokumpu targets to have a headcount of below 9,000 during 2022.

Says CEO Heikki Malinen: “We have initiated several other cost savings measures in the company, but in addition to those, the planned restructuring measures are necessary to adjust our cost structure. We acknowledge these measures are hard for the entire organization and on the individual level and we will do our utmost to ensure a transparent and fair process during this difficult time.”

The planned personnel reductions are expected to generate total annual savings of approximately EUR 70 million, thereof EUR 60 million direct personnel cost. The costs of the planned restructuring, subject to consultations, are expected to amount to approximately EUR 75-80 million. Such costs would be adjusted for and are expected to be booked in Q4/2020, whereas cash-out is expected predominantly during 2021.

For more information:

Investors: Linda Häkkilä, Manager, Investor Relations, tel. +358 40 071 9669

Media: Corporate Communications, tel. +358 9 421 3840

Outokumpu Oyj