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Debt-laden Waskita Karya lays off 500 workers in efficiency drive
Waskita Karya has laid off 500 employees as part of its ongoing efficiency drive after it missed several bond payments, with further possible reductions to come next year.
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Workers of PT Waskita Sriwijaya, a subsidiary of state-owned construction firm Waskita Karya, use rakes on April 3, 2023 to spread asphalt along a section of the Trans-Sumatra Toll Road in Ogan Komering Ilir regency, South Sumatra. (Antara/Nova Wahyudi)
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tate-owned construction company PT Waskita Karya has announced it is laying off 500 employees to improve its financial efficiency amid a push to resolve its debt burden.
The announcement comes two and a half months after the company caused stock market jitters in mid-October, when it defaulted on bonds worth nearly Rp 1 trillion (US$64 million) due in late September. It also missed earlier bond payments in May and August.
In response, the Indonesia Stock Exchange (IDX) halted trading of Waskita’s stocks in May while the government works to restructure the debt-laden state-owned enterprise (SOE).
“We are considering a lean office, the right number of employees, which currently stands at 1,500 from previously [around] 2,000 employees,” Waskita Karya CEO Muhammad Hanugroho said in a statement, Kompas reported.
Hanugroho said the layoff now allowed the publicly listed company to cut 8 percent of its administration costs, and that he did not rule out the possibility of additional layoffs next year as part of its ongoing efficiency drive.
The company would follow up with resizing in view of “how many people Waskita can handle”, he said, as quoted by Kompas. It had also reviewed the employee reduction target for next year, he added.
Read also: Govt to make Waskita Karya subsidiary of Hutama Karya after restructuring
