Consultant Scott Wilson has announced it is to cut 10% of its global workforce and freeze the pay of remaining staff in response to the global downturn. Scott Wilson shares plunged in early trading.
In a trading statement, the company said:
“The period under review has seen a rapidly deteriorating global economic environment during which the Group continued to address current market conditions and to restructure its organisation to match resources with its anticipated workload.
“The Group’s road and rail businesses in the UK, together with the majority of its International operations, particularly in China, India and Eastern Europe, continue to see high levels of demand, reflecting the benefits of its diversified business model.”
However, “Certain market sectors in the UK and the Middle East have seen the deferral of client commitments to pipeline projects and, in a few cases, the postponement or curtailment of existing work-in-progress. This has caused disruption to short-term resource planning and an adverse impact on staff utilisation.”
The consultant will act to address this by: “increasing efficiency and preserving cash.”
“Employee numbers have already been reduced and further programmes are currently underway which in total will result in a 10% reduction in our global workforce, whilst salaries for remaining UK staff will be frozen.
“Five smaller offices in the UK have been closed and where appropriate office space in major hub cities is being consolidated. Aggregate annual cost savings from these initiatives are expected to be in the order of £20M,” it read.
Scott Wilson has bank facilities remaining, with net debt at the end of February was £29.5M against committed banking facilities of £70M, repayable in April 2011.
Shares in the consultant plunged more than 17% in early trading, falling 12 points to 59p.