(Bloomberg) -- Teck Resources Ltd. started a companywide cost-cutting program and will defer some planned capital projects as global economic uncertainty weighs on the prices of its commodities.
- The company is targeting reductions of about $500 million from previously planned spending through the end of 2020, according to its third-quarter results statement.
Key Insights
- Part of the cost reduction will come from staffing cuts. The company plans to eliminate about 500 full-time equivalent positions, including through attrition and allowing temporary and contract jobs to expire.
- Teck said a year-on-year decline in third-quarter profit was mostly due to weakening commodity markets for its principal products, in particular steelmaking coal.
- The miner also warned that costs in its steelmaking coal business will increase significantly in the first quarter of 2020, as a result of planned plant outages. Expenses should drop back down again later in the year.
CEO Comment
- “Over the past few years, we have focused our attention on maximizing production to capture margin during periods of higher commodity prices,” said CEO Don Lindsay.
- “However, current global economic uncertainties are having a significant negative effect on the prices for our products.”
Get More
- Key Figures here
- Statement here
To contact the reporter on this story: Liezel Hill in Johannesburg at lhill30@bloomberg.net
To contact the editors responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net, Renee Bonorchis
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