VDM announces redundancies, anticipates earnings loss

VDM has announced 40 redundancies and a predicted loss of $7-9 million for the first half of the year.

Legacy issues, accommodation shortages on the site of two projects and the slow down in the resources sector were cited by the company in its revised earnings guidance announcement last Friday.

A third of its administrative staff and some senior executives were among the redundancies, which will mean a one-off cost of $1.2 million and annualised savings of $5.5 million.

"The current market volatility in the resource sector is expected to result in a reduction in the volume of new construction work available and that the company expected to be awarded, particularly in WA," VDM said in a statement.

The West Australian reports that nearly a third of VDM’s share price disappeared yesterday in response to its announcement.

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