Transpacific Makes Job Cuts To Work Out Debt Struggles

Transpacific Industries is undergoing cost-cutting measures by selling assets and enforcing job cuts to reduce cost of borrowings. The decision to do this was based on its December-half’s performance.

The company actually met a $42 million rise in net profit, as well as an increase in its billion dollar revenues. But because of a slump in its Victoria and New South Wales (NSW) areas, Transpacific Industries will have to retrench 200 of its employees to save on cost.

The job cut would apparently afford the company $15 million this year, while property sales will also accumulate another $15 million. The company intends to pay its $10 million debt this month, so that interest bill is reduced by at least $25 million when June rolls in. It will hold further sales of assets in order to achieve its target this year.

The slump in landfill volumes in Australia has experienced a 24% dive, and more than half of that has come from NSW alone. Analyst say that this decline is due to the current conditions in the manufacturing sector in Victoria and NSW, as well as Queensland’s move to take away its waste levy, which heavily affects NSW.

Share for Transpacific closed to 90¢ Friday, which was the highest since November when the company saw a decline in its quarter earnings, factored in by tax, amortisation and depreciation.

Still, the company is confident their performance for December-half reflected steady gains amidst debt struggles.
But according to its chief executive, “The operational performance of our waste management businesses is disappointing and we need to improve our performance markedly.”