SYDNEY—One of the world’s largest suppliers of pallets, Brambles, will cut 6 percent of its global workforce this year and scrap an extra 7 million pallets to try to bolster earnings.
The Australia-based pallet supplier, which owns CHEP pallets, watched its net income plummet from $293.7 million a year ago to $212.8 million today.
The company says much of the pain arises from the credit crisis, which has set off the worst global recession in a generation.
“Brambles is, of course, not immune to the dramatic slowdown in key markets and our results reflect this,” said Brambles CEO Mike Ihlein in a statement. “Consequently, it is important we take decisive actions now to underpin our future performance.”
Brambles is writing off $131.7 million before tax for the period, including costs accumulated while scrapping 7 million excess pallets in the United States due to “the rapid and deep economic downturn,” according to Ihlein’s statement.
Eliminating 750 jobs during the next 12 months will save Brambles as much as $70 million in the next two years, it said.