Hard on the heels of Austin Engineering flagging weak earnings, Bradken has warned of a lack of a recovery in orders, which has prompted a heavy reorganisation and round of redundancies, as it slashes its workforce by 10 per cent.
The workforce will be cut to 4700, down 10 per cent from the end of 2013, it said.
This will result in a heavy $51.4 million charge to cover the cost of redundancies and the associated reorganisation.
As a result it has cut to $173 million from its forecast just three months ago of $180 million for underlying earnings before interest, tax, depreciation and amortisation for the year to June.
This forecast excludes one-off items, it said.
“No short to medium term improvement [is] foreseen,” Bradken said of the outlook for orders, which prompted the decision to reorganise operations to cut costs.
Earlier this morning, Austin Engineering said earnings will be “materially lower” this financial year.