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Crisis corrodes steel firm profit as cuts loom

Steel manufacturer Schmolz+Bickenbach reports a first-half net loss of €149 million (SFr226.5 million) and is axing 350 more jobs as a result of the economic slump.

The company, which made a net profit of €109 million in the comparable period last year, said sales were down by more than a half at €1.05 billion as customers ran down their stocks.

“The widespread drastic effects of the economic slump were made even more severe for our company by massive inventory reductions of our customers,” the company based near Lucerne said in a statement.

Schmolz+Bickenback, formerly Swiss Steel, said it was taking various steps to meet “a lower level of demand” caused by the economic slowdown. The 350 jobs will be cut this year and next. At the end of June the company had nearly 10,000 employees.

Despite the “exceptional and irregular market situation”, the firm provided a glimmer of hope in its outlook as orders during the past few weeks have been picking back up.

The share price fell sharply in the first half hour of trading on the Swiss stock exchange to SFr31.50 ($29.72), down nearly 19 per cent from Thursday’s close.

swissinfo.ch and agencies

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