At the end of the second quarter of this year, Grammer AG had 25% fewer employees than the same period last year, and the company is expecting more cuts in the future.
The seat manufacturer's consolidated revenue for the first half of the year was EUR341.7 million (USD485.6 million) or 37.6% lower than the previous year. Consolidated EBIT was EUR19.4 million (USD27.6 million) compared to the prior year's EUR21.9 million (USD31.1 million).
One-off restructuring costs of EUR9.8 million (USD13.9 million) played "a significant role in the earnings decline", Grammer says. Measures implemented for Grammer's capacity adjustment are "having a positive effect" but the reduced costs have yet to offset the drop in revenues.
Among Grammer's markets, Europe was particularly affected with revenues down 38.2% to EUR249.7 million (USD355.1 million). North and South America saw revenues fall from the previous year's EUR82.6 million (USD117.5 million) to EUR44.4 million (USD63.1 million).
"We expect the situation in the relevant markets to remain difficult," says Grammer CEO Dr Kempis.
"Although the bottom seems to have been reached in automotive business, we are anticipating further production cuts by customers in the seating systems division," Kempis adds.
Revenue in the company's seating systems division fell by about 40% from the previous year's EUR210.4 million (USD299.2 million) to EUR125.9 million (USD179 million), due to "substantial order declines" in offroad and truck products.
At the end of the second quarter of 2009, there were 7,320 people working for Grammer, 2,434 employees or 25% fewer than the previous year.
Grammer expects its full-year consolidated revenue to be about 30% lower than the previous year's and more employee cuts are imminent.
Grammer, a producer of automotive interior systems and components and seats for off-road vehicles, trucks, buses and trains, is represented in 17 countries through 23 fully consolidated subsidiaries. Its shares are listed in the SDAX segment of the German Stock Exchange.