Downturn forces ICI to cut another 1,300 jobs

The speciality chemicals group ICI is to shed a further 1,300 jobs following the downturn in demand caused by the 11 September attacks. The job losses will cost the company £120m and will include about 275 redundancies in the UK and the closure of a plant in Plymouth producing materials for the electronics industry.

The speciality chemicals group ICI is to shed a further 1,300 jobs following the downturn in demand caused by the 11 September attacks. The job losses will cost the company £120m and will include about 275 redundancies in the UK and the closure of a plant in Plymouth producing materials for the electronics industry.

ICI said a total of 625 jobs would be shed in Europe and a further 550 in North America, where the terror attacks have had a marked effect on sales of consumer products like paint. The programme of cutbacks will pay for itself in about two and a half years and bring £60m of annual savings and a £50m reduction in working capital.

ICI reported an 11 per cent fall in third-quarter profits to £108m on sales down by 5 per cent to £1.6bn. Turnover in North America fell 4 per cent in the July to September period – half of which was directly attributable to 11 September. Sales in October were "slightly below" last year's levels but Tim Scott, finance director, said ICI had "quite low visibility about what the future holds".

The results were better than expected. ICI shares rose 12 per cent to 362p.