Energy giant RWE to slash 6,700 jobs by 2016

AFP - [email protected] • 14 Nov, 2013 Updated Thu 14 Nov 2013 10:52 CEST
image alt text

Germany's second biggest power supplier said on Thursday it plans to axe a further 6,700 jobs by 2016. RWE said it anticipated a steep drop in profitability.

P { margin-bottom: 0.21cm; }

RWE, which employs a total workforce of 67,300, has already ear-marked 10,000 jobs to be cut. The new cuts will primarily be made in Germany, Britain and eastern Europe, a spokesman said.

ARD public television suggested on its website that 4,700 more jobs faced the chop in Germany alone.

Earlier, RWE had said in its third-quarter report that it had identified additional cost-cutting measures worth around €1 billion over the next four years, without elaborating further.

"We are facing difficult times and RWE cannot simply continue to do 'business' as usual," said chief executive Peter Terlum.

"What is also certain is that everyone in our company will make a contribution to safeguarding RWE's financial power over the long term. This involves questioning processes and structures from the ground up, reducing our factor costs and shedding whatever we do not need in order to continue running our business successfully," Terlum wrote in a letter to shareholders.

RWE said it expects a sharp drop in earnings next year.

"The group's reduced earnings power, primarily in conventional electricity generation, will lead to a marked decline in the result for 2014," it said.

Net profit was projected to fall to €1.3 to €1.5 billion in 2014 from an anticipated €2.4 billion this year.

Underlying or operating profit was expected to fall to €4.5 to €4.9 billion from an estimated €5.9 billion in 2013.

RWE said: "Despite a still difficult market environment, the operating profit for the first three quarters of 2013 was more or less stable at €4.6 billion, while net profit increased slightly to €1.9 billion."

Nine-month revenues also rose, expanding by 4.0 percent to €39.9 billion. "Here, we primarily benefited from increased gas sales due to weather conditions," RWE said.

READ MORE: Energy boss warns of blackouts in Europe



AFP 2013/11/14 10:52

Please keep comments civil, constructive and on topic – and make sure to read our terms of use before getting involved.

Please log in to leave a comment.

See Also