Netherlands site next for DSM job cuts

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Dutch chemicals company DSM is cutting a further 500 jobs in
support services and manufacturing staff departments to improve
performance at its Geleen production site, it said today.

The plans, part of the 'Copernicus' project, follow a series of similar actions announced in recent months, including staff cuts in Germany and at the vitamin facility in Sisslen, Switzerland.

DSM​ wants to cut costs by more than €100 million over the next two years. The company finished 2003 with an operating profit 23 per cent lower than the previous year at €294 million. It is facing lower margins in many business areas thanks to higher raw material prices and tough exchange rates, as well as weaker demand in pharmaceutical ingredients.

This, combined with one-off charges for restructuring, saw its profit plummet to €139 million, against €1,188 million in 2002.

The new job cuts are aimed at boosting the efficiency of the company's manufacturing activities at the Chemelot site in Geleen, Netherlands. About 2,400 people work at DSM's Chemelot site in manufacturing operations and in service units that support these operations. DSM will also investigate whether a number of services can be outsourced.

The company said organisation at its support services and manufacturing staff departments is currently too diverse and too fragmented, resulting in high costs, unnecessary dilution of manufacturing expertise and a lack of competitive strength.

It is planning to improve interaction between the manufacturing plants of the various business groups and the DSM Manufacturing Center, dividing up most of the activities of the current plant staff departments and the DSM Industrial Services unit to accommodate this.

The first phase of this restructuring is expected to begin before the summer and continue through the rest of the year.

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