Construction and engineering company Group Five planned to shed 250 jobs in its civil engineering division this financial year, said CEO Eric Vemer on Wednesday.
The restructuring would come at a retrenchment cost of more than R25-million.
Vemer spoke at Group Five’s financial results briefing for the six months ended December 31, held in Johannesburg.
The restructuring came as Group Five had to align the size of its civil engineering division to its outlook on the domestic market, noted Vemer.
He said the South African civil engineering market remained subdued, with the tender market highly competitive, punctuated by a lack of large contract awards.
He noted that the company’s local order book was weak, and that it wanted to secure more work, but that the expectation of doing so was low.
Vemer believed a turnaround was feasible should government make a firm commitment to investment based on the National Development Plan, which was “a well thought out plan”, able to “drive a multiplier effect down to our industry”.
The poor performance at Group Five’s civil engineering division largely led to what Vemer on Wednesday called “a very disappointing set of results” for the JSE-listed firm.
Group Five reported a 12% drop in revenue, to R6.9-billion, for the six months ended December 31, compared with the same period in the previous financial year. Net profit was down 33%, to R146-million.
