With workers still reeling from the announcement that hundreds more jobs at Waterford Crystal are to be wiped out, the ailing parent company has admitted failure in its efforts to find an additional €74.1 million towards rationalisation costs.
The firm, which expects to reduce pre-tax losses to around €200m in the year to April 2009 but reports a 10% slowdown in second-quarter sales during August-September, says it is exploring alternative avenues.
In a trading update on Monday, Waterford Wedgwood bosses expressed confidence that its bankers will continue to back them while they are “in active discussions with a number of interested institutional investors.”
If these talks bear fruit, it’s speculated this could dilute the controlling 51% stake of chairman Tony O’Reilly and his brother-in-law Peter John Goulandris.
Waterford had planned to use the balance of the €153.7m sought last August to accelerate its streamlining plans. €79.6m was gleaned by mid-October – three-quarters of it put up by the two principal shareholders, whose total investment in the firm now stands at €400m.
Blaming “ongoing market turbulence” for the unsuccessful placing of the remaining offer, the group also confirmed it intends delisting from the London stock exchange.
However, executives are taking solace from indications that “in the face of today’s particularly challenging market conditions, Waterford Wedgwood is generally outperforming its competition.”
Regarding restructuring, the statement – which made no reference whatsoever to the Crystal division’s performance – talks about removing “complexities” in the business to improve earnings.
It’s a month since the company said a further 280 redundancies, on top of almost 500 previously agreed, will be sought at the flagship Kilbarry glass factory from early in the new year, with most manufacturing to be outsourced to Eastern Europe and Asia.