Sandvik implements structural measures to support resilience ambitions
Sandvik, based in Sweden, is implementing new structural measures to enhance competitiveness and efficiency. Announced on May 17, 2022, these initiatives include consolidating production units and optimizing the sales organization, primarily in Sandvik Machining Solutions. Expected annual savings are around 600 million SEK, with full realization by 2025. Restructuring costs are anticipated at SEK 1.7 billion, with a significant portion for employee redundancies. The CEO emphasized the need for agility and operational efficiency to support strategic growth.
- Expected annual savings of about 600 million SEK by 2025.
- Initiatives aimed at increasing competitiveness and operational efficiency.
- Restructuring costs estimated at 1.7 billion SEK, impacting short-term profitability.
- Approximately 580 employees expected to be made redundant.
SANDVIKEN, Sweden, May 17, 2022 /PRNewswire/ -- Sandvik is continuously reviewing options of how to reduce complexity and increase competitiveness, efficiency and flexibility to support the strategic direction of the Group. This becomes even more important with an active inorganic growth agenda. Sandvik's most recent program of restructuring initiatives was announced in 2020, with savings now fully realized. Sandvik has now identified and decided to implement new structural measures, which will strengthen the platform going forward.
The new measures include consolidation of productions units, site closures and optimizing the structure of the sales organization. The measures are group-wide, but with the majority in Sandvik Machining Solutions.
The iniatives will generate annual savings of about 600 million SEK, with a full run-rate expected in 2025. The savings impact during 2022 will be limited, and with gradual step up, with the share of total savings expected to be approximately
"We are constantly looking for ways to support our strategic agenda, and these structural intitatives will make us more agile, improve our operational efficiency and strengthen our platform for growth ," says Stefan Widing, President and CEO of Sandvik.
Costs related to the restructuring are expected to amount to SEK 1.7 billion, which will be reported as non-recurring costs and reported as items affecting comparability.
MSEK
|
SMR
|
SMM
|
SRP
|
Common
|
Total
|
Cost
|
50
|
1.300
|
320
|
40
|
1.710
|
Savings
|
10
|
520
|
70
|
10
|
610
|
Of the total SEK 1.7 billion, approximately SEK 400 million are non-cash items and the remaining SEK 1.3 billion mainly refers to redundancies of some 580 employees in total. Around
Stockholm, May 17, 2022
Sandvik AB
For further information, contact Louise Tjeder, VP Investor relations, phone: +46 (0) 70782 6374 or Johannes Hellström, Press and Media Relations Manager, phone: +46 (0) 70721 1008.
This information was brought to you by Cision http://news.cision.com
The following files are available for download:
Sandvik implements structural measures to support resilience ambitions |
View original content:https://www.prnewswire.com/news-releases/sandvik-implements-structural-measures-to-support-resilience-ambitions-301548694.html
SOURCE Sandvik
FAQ
What are the expected savings from Sandvik's structural measures announced on May 17, 2022?
How much will Sandvik incur in restructuring costs?
What is the timeframe for realizing savings from Sandvik's new initiatives?
How many employees will be affected by Sandvik's restructuring measures?
Which division at Sandvik will be most affected by the structural changes?
