Nalco Announces Job Cuts and Reduced Profit amidst Declining Sales

Strategic Insights -

Nalco Chemical Co. plans to trim 345 jobs, about 5 percent of its workforce, by the end of the year, citing declining sales in Asia and Latin America as well as cheaper chemical imports. The company will offer early retirement packages to approximately 500 employees, with the fate of others uncertain. This decision is part of a broader plan to reduce 1999 costs by $30 million.

Key Takeaways:

  • Nalco plans to cut 345 jobs, approximately 5% of its workforce, as part of a plan to reduce 1999 costs by $30 million.
  • The company will offer early retirement packages to about 500 employees, with the possibility of firing others whose jobs are not protected.
  • Nalco blames declining sales in Asia and Latin America, as well as cheaper chemical imports, for the job cuts.
  • The company's third-quarter profit fell 7.9% to $40.7 million, while sales rose 10% to $408.4 million, primarily due to acquisitions.
  • Amoco Corp.'s largest refinery in Texas City, Texas, has idled its reformer unit, which processes partially refined crude oil into high-octane gasoline blending components.
  • Senior DeVry officer Norman C. Metz passed away at the age of 50 after a long illness, leaving behind a legacy as a senior vice president of marketing for DeVry Inc.

Statistics:

  • Nalco plans to reduce 1999 costs by $30 million.
  • The company plans to cut 345 jobs, approximately 5% of its workforce.
  • Nalco's third-quarter profit fell 7.9% to $40.7 million.
  • Sales rose 10% to $408.4 million, mainly due to acquisitions.
  • The company expects to take a related charge in the fourth quarter due to the job cuts.
  • Norman C. Metz was 50 years old at the time of his passing.

Sources:

  • Nalco Chemical Co. (no specific source date mentioned)
  • Bloomberg News (no specific source date mentioned)
  • Amoco Corp. (no specific source date mentioned)
  • DeVry Inc. (no specific source date mentioned)