Teck Cominco cutting 1,400 jobs
Teck Cominco Ltd. said Thursday it is cutting roughly 1,400 jobs, or 13 per cent of its global workforce, as it moves to cut its costs and improve its competitiveness.
The Vancouver-based mining company said the cuts will be made in each of its business units to bolster its profit margins in the face of weak commodity prices.
Teck said it is cutting staff and contractors associated with exploration activities and research and development, and eliminating redundancies at the corporate level created with the company's recent acquisition of Fording Canadian Coal Trust's assets.
Teck is active in the mining of copper, metallurgical coal, zinc and gold.
About 1,000 employees and 400 contractors will be let go by the end of 2009, with the majority of the cuts coming in the first quarter of the year. The big job cuts are expected to save Teck about $85 million annually.
A company spokesperson said about 550 of the cuts will come in Canada, including 400 in British Columbia, 105 in Alberta and another 45 across other parts of the country.
The company also said it plans to reduce coal production in 2009 to 20 million tonnes because of declining global steel demand.
"Given continued economic uncertainty, a significant reduction in our workforce is needed to further reduce costs and position Teck for both short- and long-term competitiveness," said Don Lindsay, president and CEO.
Teck expects to take a charge of approximately $35 million in the first quarter for severance and other related costs.
The Class B shares of Teck were down 37 cents at $7.23 in afternoon trading on the TSX.