Oil services giant Petrofac (LSE:PFC) claims the end may be in sight for job cuts after a turbulent two years of low oil prices.
Group chief executive Ayman Asfari said a “significant component” of the company’s cost savings last year was the result of reorganisation, effective from January 2016.
Staffing levels at the London headquartered company have been reduced by 29 per cent in the last year to 13,500 employees. The bulk of the layoffs came from the firm’s exit from Malaysian and Romanian fields as well cutting contractors.
Despite this the firm managed to produce a net profit of $421million for 2016.
Asfari said that back office activity had been “de-layered” and “centralised” while focusing on delivery and responsibility to the firm’s clients.
He added: “The new organisation structure has resulted in recurring savings in the UK engineering procurement services and integrated engineering services.
“We have worked very hard on right-sizing the business for the future.
“Our number number of resources [employees] stood at 13,500 at the end of 2016 – that’s reflecting a reduction of 1,000 people from exiting Baharanthai and Teclini. Around 2,000 people were long-term contractors and about 2,000 in Sharjah and in India.”
Asfari added: “On the headcount reduction we have largely taken care of the big reductions. This, as mentioned, was partly due to exiting some assets and partly letting our contractor personnel go.
“We also reduced the size of the organisation.”
The chief executive said that Petrofac has a “continuous process” of looking at staffing levels but he imagined most of the large job losses had been dealt with.
He added: “We are down to a size of a machine which is a lot more efficient and I do have to emphasis that we have gone down to this size while delivering record revenue last year.
“We’ve been busier than ever, we just did it with less people.”
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