RCR has announced its plan to exit coal services, amid its other businesses, cutting close to 300 in the process.
The decision comes on the back of its ongoing business strategy review, and includes plans to significantly reduce its fabrication capacity and regional presence.
“Given the continued pressure on some commodity prices, in sectors in which we operate, and the general slowness in capital spend in both private and government sectors, RCR will close 14 local and two international unprofitable businesses as part of re-organisation,” the company said an official statement today.
The group spoke on its focus in reducing its exposure to the volatile coal sector, stating, “The Australian coal industry has suffered significantly over the past five years with low profitability and capital investment…the continued pressure on service providers to reduce pricing is unsustainable and provision of services is unlikely to return a profitable business in the foreseeable future.”
“RCR intends to discontinue 12 unprofitable businesses highly exposed to this type of mining services.”
Despite this pessimistic view on the coal sector, the group remains committed to its operations in iron ore, gold, base metals, and mineral sands.
It will also look to expand the manufacture of its mining products and deliver off-site repair to its customers. As part of the wider restructure RCR will “reduce fixed overheads in the form of people and operations”.
Speaking to an RCR spokesperson, they told Australian Mining the move will result in 270 job cuts, the closure of 14 facilities in Australia, predominately in Queensland, New Zealand, one in India, and one in Hong Kong.
According to the spokesperson the move will be fairly quickly, with the jobs cut within the coming month.