London Stock Exchange-listed Kier Group has announced plans to cut roughly 1,200 jobs by the end of its 2020 financial year (FY) as the UK contractor looks to make annual cost savings of approximately $69m from FY 2021, with the company's board adding that it would exit its facilities management (FM) and environmental services over time.
In a bourse statement on 17 June, the group said its Future Proofing Kier programme – designed to stabilise the firm’s finances – had accelerated since the arrival of chief executive officer, Andrew Davies, who replaced former CEO Haydn Mursell in January 2019.
Keir said that under the programme, roughly 650 full-time workers will exit the firm by 30 June, 2019, with an additional 550 set to leave in FY 2020, with the 12-month period ending on 5 April, 2021.
The cost of delivering the programme is expected to be approximately $72.7m in both FY 2019 and 2020.
Kier's statement read: “The reduced cost base will provide clear foundations for Kier's improved competitiveness and future growth; it will also enable investment in the group's processes and delivery capabilities.”
Kier’s board said its FM and environmental services businesses “have limited operational synergies with Kier's core businesses”, adding it would “seek to exit these businesses in due course”.
However, Kier's housing maintenance and Middle East construction businesses will be retained by the wider group and managed in a way that is “consistent with [the group's] financial objectives”.