Tomkins announces more job cuts

Tomkins has announced that a further 1,600 jobs will be cut after it reported a loss after tax of £118.1m for the first half of the year.

The London-based engineering company said that difficult trading conditions in 2009 had led to a significant decline in its end markets. Sales were down to $2bn (£1.2bn) compared to $2.9bn a year earlier.

According to the group, the decline in sales was partially offset by pricing actions taken towards the end of 2008. Despite this, however, operating cash flow fell from $90.4m in 2008 to $14.6m and the interim dividend dropped to 3.5 cents from 11.02 cents a year earlier.

As a result, the company has undertaken a sweeping restructuring programme, which will include the loss of 1,600 jobs in addition to the 3,900 cuts made in the first half of the year. So far this year, 28 plant closures have been announced, 15 of which are within the Industrial and Automotive division. The group estimates that these cost-reduction initiatives will lead to savings of $150m per year by the end of 2011.