DSME to cut staff, spin off units to stay afloat

Embattled shipbuilder Daewoo Shipbuilding & Marine Engineering Co. plans to implement 2.5 trillion won ($2.14 billion) in restructuring measures this year, larger than last year’s 1.6 trillion won, as it strives to stay afloat amid a sharp fall in new orders, the company said Monday.

As part of the measures, the shipyard plans to cut its work force by 2,000 this year to 8,500 in total by the end of the year, and accelerate its move to spin off its non-core business units such as its IT division.

Last year, Daewoo Shipbuilding cut the number of employees by 2,000 to 11,200 as of December, they said. Daewoo Shipbuilding also is seeking to sell assets worth 500 billion won, including buildings and floating docks.

Last year, Daewoo Shipbuilding said it would implement restructuring measures totaling 6 trillion won by 2019. Meanwhile, the shipyard is aiming to clinch new orders worth $5.5 billion this year. Last year, it aimed to land $6.2 billion in orders, but secured only a meager $1.55 billion worth of shipbuilding deals.

Daewoo Shipbuilding is expected to have seen its operating losses narrow last year on the back of its tough restructuring measures, including job reduction and asset sales.

The shipyard is expected to have logged an operating loss of 528 billion won on sales of 13.12 trillion won last year, according to Daishin Securities. YONHAP