Swiss elevator and escalator maker Schindler (SCHP.S) on Friday announced 2,000 job cuts over two years after first-half profit fell more than a quarter, as the COVID-19 pandemic slammed the brakes on projects and a recovery remains years away.
Schindler’s net profit totaled 313 million Swiss francs ($338.45 million), the company said in a statement, down from 436 million a year ago.
Revenue dropped 8.7% to 4.96 billion francs, while orders fell 12.1% to 5.4 billion francs as new installations and modernization projects declined worldwide and are not expected to recover to last year’s levels before 2022.
The world’s second-biggest lift-maker behind U.S.-based Otis Worldwide OTIS.N has become slightly less pessimistic about its full-year sales outlook, and now expects a decline of up to 6% for 2020, less severe than the previous forecast of a hit of up to a 10%.
Finnish rival Kone (KNEBV.HE) expects only a 4% 2020 sales decline, and said it saw Chinese business recovering.
Schindler said its net profit is now seen between 680-720 million francs, down from 929 million francs in 2019, as it takes restructuring costs of up to 130 million francs this year as it begins trimming its 66,000-employee workforce.
“Adverse conditions have been accelerating over the last few months and that calls for cost adjustment measures along the whole value chain,” said Thomas Oetterli, Schindler’s CEO. “We need to remain competitive to be able to fulfill our growth agenda. Reducing cost now is essential to secure the long-term health of our company.”