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Vitro hopes to reduce debt, cut costs

Following its annual shareholders meeting, Mexican glass giant Vitro said on 28 March 2003 that it hopes to reduce its debt levels in 2003 by up to USD 70 million and make savings of USD 40 million th…

Following its annual shareholders meeting, Mexican glass giant Vitro said on 28 March 2003 that it hopes to reduce its debt levels in 2003 by up to USD 70 million and make savings of USD 40 million through operating efficiencies, including job cuts. It also announced an investment with AFG Industries in a new plant. “We have a plan to reduce debt by between USD 50 million and USD 70 million this year,” Vitro“s finance director Claudio del Valle told journalists after the company“s annual shareholders meeting. Vitro closed 2002 with debt of USD 1.455 billion, down USD 161 million from 2001. Vitro“s Chief Executive Officer Federico Sada also told reporters that given the uncertainty of the duration of the Iraq war and its impact on the Mexican economy the company would continue to sell-off nonstrategic assets and reduce costs. “We are taking effective measures, principally in the area of reducing costs,” Sada said. “We are placing more emphasis on productivity on each and every one of our operations and on introducing new systems, updating processes that seek to slim down our workforce,” he said. Sada said the plan to be more efficient and cut costs would lead to savings of USD 40 million in 2002. “This is nothing new, we have been implementing such measures for the last five or six years.” In 2002, Vitro saved USD 22 million by consolidating operations, eliminating duplicated functions and reducing staff levels, according to Vitro“s annual report. At the end of 2002, Vitro employed 27,174 people, down 389 from the end of 2001. The company also announced plans to will invest USD 140 million in 2003, of which USD 100 million will be used to build a new plant at Mexicali on the United States border. The new plant is a joint investment with AFG Industries, a subsidiary of Japanese Asahi Glass . The plant will enter service at the end of 2003 or the beginning of 2004.

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