UK contractor Carillion pulls out of Saudi Arabia, Egypt and Qatar

Carillion said Chief Executive Richard Howson would step down and Non-Executive Director Keith Cochrane would become interim chief executive. (AFP)
Updated 10 July 2017
0

UK contractor Carillion pulls out of Saudi Arabia, Egypt and Qatar

LONDON: The chief executive of Carillion has stepped down as the Middle East construction slowdown hit home for one of Britain’s biggest builders.
The contractor said it would pull out of Saudi Arabia, Egypt and Qatar as the weak oil price slows construction spending across the Middle East. The stock plunged as it warned on full-year profits and took a provision of £845 million ($1.1 billion).
Philip Green, Carillion non-executive chairman, said: “We are undertaking a thorough review of the business and the capital structure, and the options available to optimize value for the benefit of shareholders.”
Carillion said that Chief Executive Richard Howson would step down and Non-Executive Director Keith Cochrane would become interim chief executive.
Carillion is one of the Middle East’s biggest construction and support services companies, having worked on projects such as the Dubai Canal and Oman’s Royal Opera House. But like other international construction groups that have either sold or reduced their regional businesses, it has suffered from a construction spending slowdown that has accompanied two years of falling oil prices.
The contractor did not say how many jobs would be lost following its withdrawal from three major Middle East construction markets. Carillion said on Monday that it would need to take immediate action to accelerate the reduction in average net borrowing while generating significant cashflow in the short term.
As part of that process, it said it had raised £12.8 million from the disposal of half of the economic interest in its Oman unit, Carillion Alawi.
Analysts at investment banking firm Jeffries said they expected the contractor to raise cash later in the year.
Carillion said it would only undertake future construction work on “a highly selective basis” and via lower-risk procurement routes.”
Carillion reported total contract provisions of £845 million at the end of last month — of which £375 million relates to the UK and £470 million to overseas markets, the majority of which relates to exiting markets in the Middle East and Canada.
That led the builder to revise its full-year earnings guidance with revenues expected to be in the range of £4.8 billion to £5 billion and overall performance expected to be below earlier expectations.
Carillion expects to raise a further £125 million over the next 12 months from exiting non-core businesses. It said it would also suspend dividends this year, resulting in cash saving of about £80 million. The company said it would also withdraw from public-private partnerships in the construction sector.
Carillion, along with rival Balfour Beatty was well known for its work in privately financed construction projects. The procurement method, where builders team up with finance partners to fund major construction projects in return for an operating concession was, expected to become popular in the Middle East as an alternative to traditionally procured contractors.
But it has failed to gain traction in most of the region’s major economies, which still rely on traditional contract forms and competitive tenders to award major infrastructure projects.
Carillion shares fell 39 percent to 117 pence on Monday.


Amazon workers strike as ‘Prime’ shopping frenzy hits

Updated 16 July 2019
0

Amazon workers strike as ‘Prime’ shopping frenzy hits

  • The protesters waves signs with messages along the lines of “We’re human, not robots”
  • The strike was part of an ongoing effort to pressure the company on issues including job safety, equal opportunity in the workplace, and concrete action on issues including climate change

SAN FRANCISCO: Amazon workers walked out of a main distribution center in Minnesota on Monday, protesting for improved working conditions during the e-commerce titan’s major “Prime” shopping event.
Amazon workers picketed outside the facility, briefly delaying a few trucks and waving signs with messages along the lines of “We’re human, not robots.”
“We know Prime Day is a big day for Amazon, so we hope this strike will help executives understand how serious we are about wanting real change that will uplift the workers in Amazon’s warehouses,” striker Safiyo Mohamed said in a release.
“We create a lot of wealth for Amazon, but they aren’t treating us with the respect and dignity that we deserve.”
Organizers did not disclose the number of strikers, who said employees picketed for about an hour in intense heat before cutting the protest short due to the onset of heavy rain.
The strike was part of an ongoing effort to pressure the company on issues including job safety, equal opportunity in the workplace, and concrete action on issues including climate change, according to community organization Awood Center.
US Democratic presidential contenders Kamila Harris and Bernie Sanders were among those who expressed support for the strikers on Twitter.
“I stand in solidarity with the courageous Amazon workers engaging in a work stoppage against unconscionable working conditions in their warehouses,” Sanders said in a tweet.
“It is not too much to ask that a company owned by the wealthiest person in the world treat its workers with dignity and respect.”
Amazon employees also went on strike at seven locations in Germany, demanding better wages as the US online retail giant launched its two-day global shopping discount extravaganza called Prime Day.
Amazon had said in advance that the strike would not affect deliveries to customers.
Amazon has consistently defended work conditions, contending it is a leader when it comes to paying workers at least $15 hourly and providing benefits.
The company last week announced plans to offer job training to around one-third of its US workforce to help them gain skills to adapt to new technologies.
Amazon has been hustling to offer one-day deliver on a wider array of products as a perk for paying $119 annually to be a member of its “Prime” service, which includes streaming films and television shows.
The work action came on the opening day of a major “Prime” shopping event started in 2015.
Now in 17 countries, the event will span Monday and Tuesday, highlighted by a pre-recorded Taylor Swift video concert and promotions across a range of products and services from the e-commerce leader.
Prime Day sales for Amazon are expected to hit $5 billion this year, up from $3.2 billion in 2018, which at the time represented its biggest ever global shopping event, JP Morgan analyst Doug Anmuth says in a research note.