Economic crisis hits Sulzer’s business hard

The Sulzer engineering company of Winterthur says its order intake dropped by more than 30 per cent in the first six months compared with the same period last year.

Orders for the first six months were SFr1.56 billion ($1.44 billion), “clearly below” the record level of last year’s first half, a Sulzer statement said on Tuesday.

The company, which makes pumps for the oil and gas industry as well as surface coatings for jet engines, noted that the dynamics of Sulzer’s key markets worsened and demand was clearly below the previous year’s level.

Sulzer, which has a history going back 175 years, predicted substantially lower orders for the year as a whole.

It said it did not expect a quick recovery in its key markets and was therefore implementing a global cost reduction programme for all its divisions to adapt its cost structure and capacities to the “clearly lower market demand”.

In June, the company said it planned to cut 1,400 jobs, or 11 per cent of its workforce as part of efforts to reduce costs by SFr110 million.
Sulzer has been at the centre of speculation it could merge with Swiss technology group Oerlikon to form one of Switzerland’s biggest industrial conglomerates.

Russian billionaire Viktor Vekselberg, whose investment group Renova holds about 31 per cent of Sulzer and a controlling stake in Oerlikon, said in an interview with Swiss business newspaper Handelszeitung in June that a merger was one of many options.

However, he added that it was too early to think of such a step.

swissinfo.ch with agencies