RHI AG secures competitive position based on new group structure – capacity is adjusted to difficult market environment (ad hoc)

08. April 2009

RHI AG, the world market leader in refractories, announced a comprehensive programme for structural optimisation and increased efficiency on 12 March 2009. This programme provides for cost savings amounting to approx. EUR 80 million and is now being enforced. The profit centre organisation has been successfully implemented with effect from 1 April 2009. At the same time, capacity worldwide will be adjusted with immediate effect due to the ongoing difficult economic climate. In addition, RHI will also evaluate the existing plant concept in the next months within the framework of structural optimisation in order to secure its competitive position in the long term and to better utilise the growth opportunities in Asia and South America.

Efficiency increases resulting from the new profit centre organisation entail a staff reduction by roughly 250 jobs. The cutback of production volume due to the crisis leads to a reduction by 750 jobs in production. Overall, RHI will reduce the number of employees in administration and production from 7,766 by approx. 1,000 jobs worldwide in the year 2009.

The measures now implemented account for half of the targeted cost savings of EUR 80 million p.a. in the financial year 2009. The reduction of personnel costs will accomplish approx. 50% of the targeted savings; 50% will be realised through material costs. In addition, a programme to reduce working capital has been implemented in order to further strengthen liquidity.

The initiated capacity adjustments as well as the new, future-oriented group structure will secure the Group’s competitiveness on a sustained basis.