Babcock & Wilcox Enterprises Inc (NYSE:BW) has posted two consecutive quarters of losses in 2017, resulting in U.S. job cuts for the multinational company. The Babcock and Wilcox layoffs will affect nine percent of its global workforce, which numbers about 4,700. The nuclear power company has struggled in 2017, posting an over 72% decline in its stock value since the beginning of the year.
The Babcock and Wilcox quarterly losses have both been followed by Babcock and Wilcox job cuts.
Babcock and Wilcox Makes Around 70 Job Cuts Across U.S.
Babcock and Wilcox, a company that works in energy and environmental technologies, will be shedding around 70 jobs in the U.S. as part of its effort to save on costs. As mentioned above, the company will be instituting massive reductions across its global workforce.
The Babcock and Wilcox layoffs are seen as a response to the company’s poor performance during the most recent fiscal quarter. This is the second quarter in a row where the company has registered poor numbers in its financial report.
Babock and Wilcox cost-cutting has been in the works for much of 2017, as the power company has attempted to adapt to the losses that it has experienced this year.
The energy division was spun off from Babcock & Wilcox Co. in 2015 to become Charlotte-based Babcock & Wilcox Enterprises, with the power generation company layoffs ramping up ever since.
Babcock and Wilcox Reported Losses in 2nd & 3rd Quarters of 2017
The Babcock and Wilcox quarterly losses are seen as the main drivers of the job cuts.
In the third quarter of 2017, the company reported a net loss of $114.1 million. A year earlier in the same period, the company netted an income of $9.0 million.
“During the quarter, we made significant progress on our U.K. Renewable new-build projects, and we continue to expect these projects to be substantially construction complete by mid-2018,” said E. James Ferland, Chairman and Chief Executive Officer, in a statement connected to the most recent quarterly report. “Importantly, we were able to agree to design changes with multiple customers that enhance plant performance and largely offset the financial impact of the boiler structural steel design issues we identified in late-September.”
“We are driving cost-savings actions within our business segments and in overhead-related functions, with a target of approximately $45 million in annual savings, as we work to improve our global cost structure.”
The Babcock and Wilcox layoffs were also exacerbated by a poor second quarter, released in August. The company showed revenue of $349.8 million, falling by $33.4 million (8.7%) compared to Q2 2015.
“Our second quarter financial results reflect a $115.2 million charge arising from unexpected cost and schedule issues in the Renewable segment,” Ferland wrote in a statement sent out with the report’s release.
In both cases, Babcock and Wilcox restructuring was called for, which meant dozens of U.S. job cuts.
Babcock and Wilcox’s Earlier Layoffs in 2017
This latest round of Babcock and Wilcox layoffs was not the only U.S. job cuts the company initiated this year.
An earlier round of Babcock and Wilcox job cuts 2017 occurred in June, when the company laid off 55 workers at its Beloit, Wisconsin location.
“Babcock and Wilcox Universal to close Beloit facility in early June,” WKOW, April 5, 2017.
“Charlotte headquarters of Babcock & Wilcox hit by layoffs,” The Charlotte Observer, November 8, 2017.
“Babcock & Wilcox Announces Second Quarter 2017 Results,” Babcock and Wilcox, August 9, 2017.
“Babcock & Wilcox Announces Third Quarter 2017 Results,” Babcock and Wilcox, November 8, 2017.