…try another time. Yesterday METSO announced that the co-decision negotiations over a reduction of the workforce in Finland was concluded and that staff will be reduced by 536 people. Metso originally announced that perhaps 630 people would be fired. Today METSO announced that it would reduce the workforce by 160 more people. These are in part in other locations than in the previous negotiations.
Yes, the Finnish paper industry is still in a process of structural change (which is an euphemism of course). Yes, the new growth markets are far away in China and Asia. Yes, Finnish labour is relatively expensive.
But – all these things taken into consideration – Finnish workers, especially in industry, have very high skills and capabilities. Furthermore, firing people is of course a way to save money, but the goal of profit means that besides costs, there are also revenues. It is probably partly ‘the market’ that leads to reduced revenues, but what about innovation etc? On The Paperindex Times, METSO is featured heavily regarding quality improvements, innovations etc. like here.
If METSO makes good products that companies want, but revenue nonetheless lags, would it be time to revise profit goals? No, of course not, because shareholders don’t like that. [sarcasm]The only thing that makes shareholders happy, is a company that fires people. [/sarcasm].
Oh, and 536 + 160 makes 696, which may mean that METSO will achieve its original goal of 630 people less. Shareholders will be happy, expect rising shares for METSO. Maybe the extra divident will come after all. [sarcasm again.]
UPDATE: I recently discovered Google Finance and what I said above did not really pan out as expected, although there was a small peak in the beginning of today, see here.