Up to 500 employees could be made redundant by metrology manufacturer, Renishaw, in a global programme to reduce costs by £10 million. Although the precise nature of these reductions is still to be decided, the majority of these are expected to be within the UK.
Since the Renishaw Group's interim report on 28th January 2009, trading conditions have deteriorated further. The Group’s sales of measuring equipment are particularly affected by the demand for capital goods in industries such as automotive which are unlikely to recover in the near term. Renishaw expects to record an operating loss in the order of £10 million for the second half of its current financial year, ending 30th June 2009, and has already initiated a programme of overhead cost reductions with target annual pre-tax savings of £10m.
The company say that if this programme is implemented in full, it is expected to result in annualised savings of approximately £20 million before tax with effect from 1st July 2009, at a one-off cash cost to the Group of £8 million. The savings arising from this action are in addition to the voluntary 20% pay cut earlier this year and which may be extended till year end, representing a quarterly saving of some £4.5 million in the current year.
Sir David McMurtry, chairman and chief executive said, "In view of the unprecedented slowdown in customer demand for measuring equipment in recent months we have been forced to take decisive action to reduce our cost base in order to protect our business for the future. We will continue to invest in our products and markets and, even during these difficult times.”
Renishaw said that sales of its Raman spectroscopy products continue to grow strongly and, in March, Renishaw launched its dental business across Europe with a further new product launch, to take place in May, of a new surgical robot for neurosurgical applications.