Hills to go heavy on comms technology as the building market slumps.
The Hills Group restructure plan, announced today at its Annual General Meeting, will see the company go heavy on technology as the building industry slumps.
The restructure will be carried out across the Group’s businesses, and a slew of new objectives announced.
In relation to its electronics business, Hills told shareholders it will “simplify the division structure and our supply chain.”
The group also “plan to focus on revenues from higher growth sectors such as communications and home and industrial technologies.”
Hills’ business interest spans the electronics sector (CCTV systems, amplifiers, automation), construction and lifestyle equipment. The company said it will restructure every division between now and the end of the year, and hopes to save of $10m-$15m in FY13 and $30m-$40m in FY14.
The move is due to the current cyclical down-turn in the construction sector, Hills new Managing Director, Ted Pretty (ex-head of Telstra Digital), said today.
Hills will exit certain products, businesses and consolidate selected manufacturing activities.
“The steps we are taking today are intended to ensure the Hills Group is better placed to weather the current cyclical down-turn in the building and construction sector and is repositioned to take advantage of opportunities in higher growth sectors in the future,” Pretty said.
“We remain committed to creating long term value for shareholders,” he continues.
The company also announced “some reductions in staffing levels” although it is not known how many jobs will go. Hills employs over 2500 staff, currently.
The intent is that by 2015, over 75% of total Group revenues will come from non-steel activities and the Company’s ROE and trading valuation will be above the midpoint of Hills’ competitors.
Company shares rose 11.18% to $0.84, today.