The Eindhoven lighting company Signify will cut a thousand jobs, almost half of which will be in the Netherlands. CEO Eric Rondolat said this in an explanation of the annual and quarterly figures. Philips’ former lighting division is facing challenging market conditions.
The job losses are part of a previously announced reorganization that should result in savings of two hundred million euros. Last year, 2,700 jobs disappeared at the company.
‘Cutbacks inevitable’
At the end of last year, Signify had almost 32,000 employees worldwide, approximately two thousand of whom in the Netherlands. The company cannot yet say how many forced redundancies will occur in the Netherlands.
According to CEO Rondolat, the cuts are unavoidable. “If you look at our costs as a percentage of turnover, we will be at 31 percent at the end of 2023. That is far too high.”
Houthi rebels
According to Rondolat, Signify is mainly struggling with disappointing results in China, the company’s second largest market. The company is also experiencing problems due to rising tensions in the Middle East, where cargo ships in the Red Sea are being attacked by Houthi rebels. “We are seeing an increase in delivery times to twelve days because ships have to follow a different route due to the conflict. And the container price has risen.”
Signify will be split into four divisions this year to improve customer focus. Each division gets its own profit and loss account.
Philips Lighting
Signify’s turnover fell by almost 11 percent last year to 6.7 billion euros. Rondolat expects the challenging conditions to continue this year, but says he is confident in the chosen strategy. “Over the past quarter, we introduced a new business model and measures that will improve our performance.”
Signify previously operated under the name Philips Lighting. The company went public in 2016, after which the company name was changed to Signify.