The board of PKP CARGO S.A. has undertaken a difficult process of restructuring, which encompasses all areas of PKP CARGO S.A.’s operations. Corrective actions are being implemented to achieve financial stability of PKP CARGO, S.A. The deteriorating financial situation of the company necessitates taking decisive decisions.
The key operational goal is to conduct an effective restructuring, which will allow for maintaining financial liquidity, and in the long-term perspective – for competing effectively in the freight transport market, regaining customer trust and building stable foundations for further development. Given the difficult financial situation of PKP CARGO S.A. resulting from a significant decrease in rail transport, causing reduced revenues and a tendency for further decrease compared to the previous year, which is tantamount to the occurrence of periodic financial difficulties and limitations on the company’s tasks – it is necessary to undertake all possible actions to reduce costs, ensure the company’s financial stability and protect jobs.
“For the first three months of our existence in the company, we analyzed the situation and set PKP CARGO on a healthy track. During this time, we also prepared an application for the opening of the remediation proceedings, which we submitted at the end of June to the court,” says Dr. Marcin Wojewódka, the interim President of the Board of PKP CARGO in restructuring, to eNewsroom.pl. “And by the end of July, the Economic Court in Warsaw opened the so-called remediation proceedings. Now, PKP CARGO, S.A. is a company in restructuring. What does this mean? Thanks to remediation, the company gained a protective shield against creditors, as we unfortunately did not pay off a large part of the debt. We have a lot of arrears towards our contractors, but due to remediation, even though of course we’ll have to repay the debt, our creditors cannot carry out effective enforcement against us. For example, they can’t seize our locomotives or properties. This allows the company in remediation, despite the debts it has, to function peacefully, earn current liabilities, provide services, and set aside funds to repay historical debts. At the same time, remediation gives us the opportunity to carry out deep human resources restructuring, as unfortunately our company has an excess of employees of several thousand people. Simply, the company has never been adapted in terms of number of employees to transportation work. Thus, we’re currently in the process of group layoffs. They will continue over the coming weeks – more than 4149 people will no longer be employees of PKP CARGO by this year. These, of course, are restructuring activities. They concern not only the area of employment, but also many other areas. We withdrew from sponsorship agreements because we can’t afford them. We have reorganized the purchase of legal services in order to reduce the costs of external law firms. We are in the process of reviewing and already making the first decisions regarding the sale of unnecessary properties. We are in the process of changing the organizational structure and we’ll withdraw from some locations in the coming weeks and months. We gave up a very large office building in Katowice. There are many initiatives on the cost reduction side, and at the same time, we are taking actions to obtain new contracts in this very difficult, competitive market. We’ve managed to secure a large transport job for 9 million tons of coal transport from Bogdanka to Kozienice from these large contracts. We also managed to secure a large contract with the steel company Arcelor Mittal – also for millions of tons of transport work. And these are very important contracts – because they also show that it’s possible to conclude them also in the remediation,” Dr. Marcin Wojewódka points out.
Source: https://managerplus.pl/pkp-cargo-w-przyspieszonym-tempie-restrukturyzuje-dzialalnosc-ciecia-etatow-sprzedaz-nieruchomosci-87485
