Structural steel giant Severfield is preparing to reduce its employee headcount as part of a wider business review aimed at cutting costs.
In a group trading update, issued today (24 April), Severfield revealed it is planning a round of redundancies which will result in a 6 per cent reduction in its workforce.
Severfield is understood to employ around 1,800 people, which means more than 100 jobs will be axed.
It comes amid trading pressures the group is currently facing in the UK and Europe, including drawn-out project deliveries and tighter pricing.
And while its bridge remedial works programme is progressing as expected, the end cost remains unchanged at £20 million.
As part of its cost-cutting measures, which will also include halting the recruitment of new employees, Severfield is prioritising a “stronger than normal” focus on cashflow, alongide reducing planned capital spending.
“We have recently completed a headcount review which will result in a reduction in group headcount of 6 per cent through a combination of redundancies and the non-recruitment of approved vacancies,” said Severfield.
“In addition, there is an even stronger than normal focus on cash generation and conservation.
“This includes careful working capital management, the acceleration of certain tax refunds from HMRC, a reduction in planned capital expenditure, taking into account the significant investment in the asset base over recent years, and other ongoing cost reduction actions.”
It added: “We continue to take appropriate cost reduction actions to mitigate the effects of the trading pressures the group is currently facing.”
For the year ended 29 March 2025, Severfield declared net debt of £44 million, adding its underlying pre-tax profit is expected to be between £18 million-£20 million.
Its order book for the UK and Europe stands at £440 million, of which £327 million is for delivery over the next 12 months.
Alan Dunsmore, the chief executive officer of Severfield, is due to leave his post on 30 June after more than seven years in the job.
Was this interesting? Try: Sir Robert McAlpine back in profit
If you have a tip or story idea that fits with our publication, please contact the news editor rory@wavenews.co.uk
Get industry news in 5 minutes!
A daily email that makes industry news enjoyable. It’s completely free.
