Kim Heng Implements Cost Control Steps, Include Cuts in Salary, Workforce
Kim Heng Offshore & Marine Holdings Limited (Kim Heng or the Company, and together with its subsidiaries, the Group), an established integrated offshore and marine value chain services provider in Singapore, reported Monday that it has implemented cost control initiatives to better prepare for the challenging oil & gas downturn.
The initiatives include the reduction of overall compensation across the Group which will include senior management and the board of directors (the Board). Compensation reductions will range from 5 - 20 percent with the higher reductions applied to senior management and the Board. The Company is also reducing its foreign worker workforce and providing compassionate compensation to departing foreign workers who have performed with skill and dedication.
“The current low oil price environment warrants conservative management of our cost structure so that we can remain resilient as a Group and able to ride through this downturn. We will continue to review our cost cutting measures as well as our capex spending on an ongoing basis,” said Group CEO and Chairman Thomas Tan. “Nevertheless, Kim Heng highly values the contributions of our employees and recognises that our people are our most important asset. As such, we have designed our cost rationalization strategy to minimize the number of workforce reductions and share our cost reductions across the organization, including significant salary reductions for both senior management and the Board. We hope to balance business necessity with compassion, and are thus providing voluntary additional compensation to departing foreign workers who have served us with excellence."
As per the Company’s recent announcement regarding the results of its Annual General Meeting, shareholders have approved the payment of a final dividend of $0.0022 (SGD 0.003) per ordinary share for the financial year ending Dec. 31, 2015. “We hope to reward our shareholders for their continued support through the current downturn and for remaining confident in our Group's long-term prospects,” said Tan. “Through prudent cost management, close partnership with our shareholders, and strategic diversification of our business, we will emerge from this down cycle as a stronger, more resilient Kim Heng."
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