Sapura Energy to cut 20% of jobs

PETALING JAYA: Sapura Energy Bhd will be laying off 20% of its full-time staff worldwide, as it anticipates the economic slowdown caused by the Covid-19 pandemic, as well as oil price volatility, to affect its financial strength.

In a statement yesterday, chief executive officer Tan Sri Shahril Shamsuddin said it was necessary to right-size the organisation based on a focused business strategy, given the cyclical nature of the oil and gas industry.

“In our previous announcement, we had mentioned the need to reduce the workforce. As much as we tried to delay this decision, it is inevitable at this point.

With a heavy heart, we would like to inform you that we are currently meeting several colleagues, at every job level, to discuss their departure from the company.

In this exercise we will be reducing about 20% of our fulltime employees worldwide, of which 63 % were on contract, and the remaining permanent employees.”

Sapura Energy employs more than 10,000 people, of which 4,000 are full-time employees.

Apart from a severance package, Shahril said the company has allocated an additional Rm1mil to help the employees affected to transition to their next career.

In late April, the company announced salary reductions that affected a third of its workforce.

Sapura Energy reported a net loss of Rm4.23bil for its fourth quarter ended Jan 31, 2020, compared with a net profit of Rm500.43mil in the previous corresponding period.

Revenue in the first quarter dropped to Rm1.11bil compared with Rm1.49bil in the previous corresponding period.

For its financial year ended Jan 31, 2020, the company recorded a net loss of Rm4.56bil compared with a net profit of Rm207.55mil in the previous corresponding period, while revenue grew to Rm6.45bil compared with Rm4.57bil a year earlier.