Royal IHC to Lay Off 425 Staff
Royal IHC, a leading manufacturer of equipment for dredging, offshore E&P and marine construction, has announced the layoff of 425 staff in the Netherlands due to challenging market conditions.
The firm said that it would adjust its strategy to focus more on "knowledge-intensive activities," and most of the layoffs will affect indirect and support positions.
"IHC is increasingly outsourcing production activities in order to remain distinctive and cost-efficient in its marketing of ships, equipment and services, with product development and design, as well as sales and marketing remaining within the company," the firm said in a statement.
In addition to the layoffs, IHC is idling one of its two shipbuilding slipways and cutting its executive board down to two individuals, CEO Dave Vander Heyde and newly appointed CFO Arie Vergunst.
IHC said that sales were far down for the year to date, due in part to the drop in oil prices and offshore activity, but also due to increasing competition from firms in Eastern Europe and Asia. It intends to focus its strategy on boosting sales, building a local presence in international markets, and promoting the growth of its most successful product and service lines – like its IQIP business unit, which focuses on offshore installations, foundations and decommissioning. As an example of its work, IQIP provided the jacket cutting tools for Allseas' dramatic single-lift removal of the Yme platform, the first of its kind. The North Sea decommissioning market is expected to grow into a multibillion-dollar industry as oil majors begin to remove infrastructure from maturing fields.
The yard's decision to downsize and refocus mirrors the strategic changes made by some of its customers. Leading dredging and offshore services firm Boskalis announced the layup of two dozen ships and a workforce reduction of 650 personnel in July.