In an interim financial report Tuesday, Denmark-based energy group DONG Energy revealed plans to lay off between 350 and 400 employees in the next few weeks. The company says the job cuts are part of an ongoing strategy to streamline operations and remain competitive.
According to the report, DONG Energy's first-half 2013 revenue increased by 2% compared with the first half of 2012, and EBITDA rose by DKK 1.2 billion. Profit for the period fell by DKK 0.3 billion.
"The first-half financial performance is a positive step in the right direction for DONG Energy. The group's earnings (EBITDA) are 18 percent ahead of the first half of 2012," comments Henrik Poulsen, CEO of DONG Energy.
He says that the increase was mainly driven by cost reductions and earnings from the company's new offshore wind farms: the 630 MW London Array in the U.K. and the 400 MW Anholt project in Denmark. The company's Wind Power earnings rose by DKK 0.9 billion in the first half.
Regarding the job cuts, Poulsen explains they are part of DONG Energy's 2020 strategy announced in February.Â
"In the first half, we put in place a variety of measures to streamline and improve the efficiency of the group's structure and processes," he says. The initiatives are expected to reduce costs by DKK 0.3 billion in 2014.
Poulsen refers to the layoffs as "a difficult, but unfortunately also necessary, process to improve DONG Energy's competitiveness in an energy sector that is undergoing an extensive and challenging transformation of both energy systems and business concepts."
The report did not specify which of the group's businesses would be affected by the layoffs.