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Olav Nils Sunde’s cruise company, Color Line, has been through a difficult period six months after the historic pandemic occurred.
Owner Olav Nils Sunde owns the Color Group, and has remained one of the biggest Norwegian crown losers. (Photo: Håkon Mosvold Larsen)
The company is now announcing a major restructuring that involves both downsizing and other types of cost cuts.
300 man-years will be cut from 2021.
– For greater profitability and efficiency, among other things as a result of the company’s many years of investments in digitization and new logistics technologies / systems, combined with increased centralization, Color Line will implement a comprehensive and long-lasting cost saving program, the company writes in a statement on the stock exchange Friday morning. .
– Ensure future profitability
The failing company further writes in the report that the goal is to cut costs by NOK 250 million from 2021. This means cutting 300 employees.
– The plans will ensure future jobs and profitability, says CEO Trond Kleivdal at Color Line in a press release.
The company says that the restructuring and downsizing is due to the “challenging situation regarding covid-19”.
The restructuring is expected to cost approximately NOK 50 million, according to the company.
– Color Line plans to use as many voluntary schemes as possible in relation to
reduction, says Trond Kleivdal in the press release.
– Now we have started a process and we are in good dialogue with the employees. This has been carefully analyzed and evaluated over a long period of time because we see that we need to improve the result.
– Sad news
As usual, Color Line has 1,700 employees at sea and 500 on land. To date, around 300 of them have been fired, according to chief union delegate Erina Bryn Kjær at Color Line.
– It’s sad news. It’s incredibly difficult for employees to receive this message today, says Kjær in connection with the group management’s shutdown warning.
It claims that employees received a text message and email about the cuts on Friday, just before a press release was sent out.
– It will probably come as a surprise to many, but Color Line has had many challenges since authorities closed in March. We hope that someone will voluntarily resign to make the reduction less, says Kjær, who says shop stewards have participated in management discussions about the reduction.
– All employees knew there would be consequences, but I think it’s a surprise that it happens and includes up to 300 employees.
Kjær says there will be position cuts at almost every level, both on land and at sea.
Big financial losses
The cruise industry became one of the biggest losers from the crown crisis after authorities around the world closed their entry and exit borders.
The result of the travel restrictions is evident in Color Line’s lack of revenue in the first six months of the year.
The total result was minus NOK 639 million, compared to minus NOK 6 million in 2019.
– Before covid-19 was a fact, Color Group expected a better result than the previous year, with full operation in all concepts and with an effect throughout the year for the newly built M / S Color Hybrid, which has shown good development on the Sandefjord – Strømstad line, the company wrote. in the semi-annual report and announced even then that there will be a restructuring in the company.
Compensation received
Owner Olav Nils Sunde is among the Norwegian investors hardest hit by the crown crisis.
In June, DN reported that Color Line was one of the biggest beneficiaries of the state compensation plan in connection with the crown recession.
In the semi-annual report of the company, it can be read that the state support plan was NOK 129 million.
– It is clear that when the stores are closed and the ships are ordered to enter port, it is serious. The question is how long the ships stay. Even though the ships will start sailing again at the end of June, we will be hit hard, CFO Bjørn Paulsen of the ON Sunde family group told DN in June. (Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases via a link, which leads directly to our pages. Copying or other use of all or part of the content may only be done with written permission or as permitted by law. For more terms, see here.
