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Schering AG To Cut Plants and Staff
Schering AG (Berlin, Germany) Chief Financial Officer Joerg Spiekerkoetter revealed on Monday that the company would lay off 2000 employees and eliminate 12 of its 24 pharmaceutical manufacturing sites in an effort to increase profitability by 18% for 2006.
Sites in Mobara (Japan), Nanjing (China), and Tikkakoski (Finland) have already been terminated with additional plants in Orizaba (Mexico), Bedford (MA, USA), Lys-lez-Lannoy (France), Alcalá de Henares (Spain), Sakura (Japan), Osaka (Japan), Jakarta (Indonesia), Buenos Aires (Argentina), and Bogotá (Colombia) slated for closing by 2010.
The restructuring plan is part of a program the company calls “Focus,” which was established to help streamline Schering’s portfolio and improve its profit margin. In the 2004 fiscal year, the company reduced costs across the board in administration, engineering, research, and development.
“Based on our solid business performance and further efficiency measures, we will continue to invest in growth opportunities and to improve our profitability,” said Hubertus Erlen, Chairman of the Executive Board of Schering AG. “We are committed to even further increase our operating margin above 18% beyond 2006.”