COLOGNE, Germany—Lanxess A.G. will eliminate 1,000 jobs worldwide by the end of 2016 as part of its three-phase realignment program, “Let's Lanxess Again,” the firm said Nov. 6 as it released its financials for third quarter 2014.
The firm reported sales of about $2.55 billion for the third quarter, a decrease of less than a percent compared to 2013. Net income increased to about $43.8 million, up 318 percent from 2013.
Lanxess said about half of the positions will be eliminated in Germany, mainly in the administrative and service, marketing and sales, and research and development units.
The firm projects total annual savings of about $187.8 million by the end of 2016, with expected savings of about $25 million in 2014. Lanxess said it expects exceptional charges of about $187.8 million through the end of 2016, with about $125.2 million already being incurred in 2014.
“The realignment lays the foundation for Lanxess to return to sustainable growth in the mid-term,” CEO Matthias Zachert said in a statement. “Downsizing the work force is a necessary measure to improve our competitiveness.”
Lanxess and its employee representatives have agreed on a severance program in order to implement personnel measures at its German sites. Lanxess said the affected employees will be offered severance payments, advisory services and support in finding new jobs outside the company.
As of Nov. 6, solutions have been found for more than half of the projected 500 employees affected in Germany. The firm said if the targeted number of job cuts has not been achieved fully when the severance program expires in a few weeks, it cannot rule out separations for operational reasons.
“These job reductions are tough. However, we have reached a fair agreement with the employee representatives in Germany after a series of constructive negotiations,” Rainier van Roessel, member of the board of management and labor relations director, said in a statement.
“Let's Lanxess Again” is the second series of layoffs the firm has implemented in the last year. Lanxess just completed its “Advance” program, which a spokeswoman confirmed resulted in the reduction of 875 jobs worldwide.