The businesses in the USA are opening slowly amid COVID-19, though lacks in liquidity. The President of Norwegian Aluminium maker Norsk Hydro’s North American extrusion unit, Charlie Straface has been assembling a COVID-19 task force every other day to draw up the cost-cutting measures to balance the reducing revenues and also to protect the unit’s cash balance economic plunge related to the epidemic.
Straface said: “Things are changing day-to-day. We have to anticipate everything that could go wrong relative to our cash-flow situation”.
Straface also added: “My unit, headquartered in Illinois, has already furloughed employees and slashed operating expenses. The cash balance looks positive for six months.”
At Hydro’s North American extrusion unit, the plunging of revenues has augmented the need for working capital 15% over the past month, and the worst is yet to come. The unit has projected that sales might dip by up to 30% in April and May’20, causing a remarkable jump in inventory.
Hydro has executed layoff measures of about 10% of its employees in the US and Canada and ordered all the 23 facilities to drop operation expenditures by as much as 20% to protect its cash balance.
Straface also stated: “If the situation worsens, the unit could consider draconian steps such as halting all the capital spending for the year, temporary plant closures and salary cuts.”
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