LONMIN: The world’s third-largest platinum producer, will cut its annual output targets by 100,000oz over the next two years and will cut 6,000 jobs, including contractors as it shuts its Hossy and Newman shafts.
Lonmin is putting a number of older shafts into care and maintenance, which are managed by contractors. It will cut jobs across the board to cope with a smaller production base. The company was making negative earnings at the current price, CEO Ben Magara said.
The job cut programme started in May had already resulted in 1,355 people leaving the company. Lonmin had said earlier this year it was looking to cut 3,500 jobs. It started consultations on Friday morning with labour to make the deeper cost cuts.
“This process is further intended to facilitate these closures and protect the majority of our workforce,” Lonmin said. “Our objective is to save the majority of the positions in the company and create a sustainable business by taking urgent action and maximising liquidity to protect the business,” it said.
Lonmin is reviewing its balance sheet in the light of the drop in the platinum price below $1,000/oz and conceded it was considering the need to refinance its debt facilities.
