Eastman Chemical to lay off 200-300 jobs; trim cost by US$100 mln

Eastman Chemical Company, one of the leading manufacturer of chemicals, fibers and plastics, have announced additional cost reductions measures to trim cost by US$100 mln in face of the current deepening economic crisis worldwide. In addition, the company lowered its budgeted 2009 capital expenditures to between US$300 and US$350 mln. It also expects to generate approximately US$100 mln of cash from working capital in 2009, assuming continued difficult economic conditions and raw material and energy costs similar to current levels. The measures announced by the company include laying off around 200-300 employees worldwide within the next 4-6 weeks; trimming base pay for U.S. employees by 5% effective March 30, 2009, with equivalent cost reductions in bargaining unit sites and locations outside the U.S.; cutting down on non-critical maintenance costs and logistsics cost. These actions announced will result in a Q1 - 2009 pre-tax restructuring charge of approximately US$30 mln. Brian Ferguson, chairman and CEO commented, "Assuming a modest improvement in demand that increases our capacity utilization from the current rate of approximately 71% to between 75-80% for the remainder of the year, we expect our full-year 2009 earnings per share will be between $2.00-$3.00 excluding charges related to cost cutting actions."
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