Bollore Transport & Logistics Kenya is laying off an unspecified number of workers due to what it terms as unforeseen market challenges and threats that have dwindled its fortunes in recent months.
The firm, which has lately lost out on several lucrative deals, says industry policy changes including implementation of the standard gauge railway (SGR) have affected cargo handling processes leading to reduced business.
The company, a subsidiary of Bolloré Transport & Logistics, owned by billionaire Vincent Bollore who was recently questioned in France for possible use of bribes in Guinea and Togo to obtain port contracts, made the revelation in an August 20 memo to its employees.
Human resources managers and heads of business units have also communicated with all affected staff, according to the internal memo by Bollore Kenya managing director Jean-Pascal Naud.
“We shall consequently embark on restructuring the company into a leaner, more focused and customer-centric organisation by combining teams, reducing layers and stopping non-core or non-profitable activities,” explained Mr Naud.
“Regrettably, through this process, some of our colleagues will exit the company. My thoughts are with our colleagues that will be leaving us.”
The firm also lost a lucrative UN contract to its competitor Hashi Energy, further dealing a blow to its revenues in the region.
Sources at the company told the Business Daily that the firm has lost more than 200 trucks after owners withdrew them due to about three months of non-payment. This has made it difficult for the Embakasi-based firm to deliver on its contracts.
The management has therefore turned to cost cutting measures to save the company from going under.
“These changes and reduced project activity in the country as well as in the Eastern Africa region, have affected the level of profitability of our company significantly and resulted in our lowest financial performance experienced in the recent past,” said Mr Naud.