US Ashland plans $100m cost-cutting programme

24 July 2009 17:14  [Source: ICIS news]

HOUSTON (ICIS news)--Ashland plans to cut an additional $100m (€70m) in costs by the end of the fourth quarter, the US company said on Friday in a conference call with investors.

Ashland reported fiscal third-quarter net income of $50m, down from $72m a year earlier, but stressed that the results were not comparable as they were significantly affected by the acquisition of Hercules last year.

CEO James O'Brien said that demand could remain flat for the foreseeable future due to the global economy.

The $100m in savings will come mainly from job reductions and other cost-cutting measures, including $27m already identified in Ashland Distribution, O’Brien said.

Ashland exceeded its earlier $265m cost-reduction programme for 2009 by $22m, the company said.

During the third quarter, $87m savings were realised, including $54m of selling, general and administrative expenses and $18m of one-time savings, the company said.

Much of the savings have come through the company’s furlough programme, O’Brien said. Ashland has reduced staffing by more than 1,300 workers since April 2008.

($1 = €0.70)

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By: Heather McGuire Doyle
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