Smit To Cut Costs, Focus On Growth Markets
Dutch shipping group Smit Internationale NV will continue cost-cutting in 2001 and put more focus on growth markets. "Our company should become more transparent and the risk profile of our market groups and activities should be clear," Chief Executive Nico Buis said.
He declined to elaborate until decisions on the company's "sharpened strategy" are made by this summer, but added the number of business units would be cut. Earlier on Friday, Smit posted total 2000 net profits of 14.2 million euros ($12.5 million), down from 25.5 million in 1999.
Last year, Smit had already predicted a substantial profit fall as the maritime contracting markets had slumped. In December it said it would reorganize various units. The maritime contracting division ended the year with an operating loss of 2.5 million euros, against a profit of two million in 1999. Buis said the 2000 figure had been flattered by a 7.5 million euro gain on the sale of equipment. Specialized drilling projects in England, Scotland and Thailand caused substantial losses because of miscalculations.
Smit reacted by changing the management of its British unit Smit Land & Marine Engineering in Bromborough and reducing the subsidiary's activities. The unit's Tain site in Scotland was sold and the number of workers cut to fewer than 80 from 140.
Port and coastal towage activities in Europe also lost money and costs will be cut here as well. Smit plans to close its sales offices in Hamburg and Oslo and the company plans to end losses in Germany within three months. The efficiency plans should generate annual cost savings of at least four million euros by the end of this year. - (Reuters)