STA, 6 June 2019 - Home appliances producer Gorenje will lay off 104 workers, which is fewer than the initially presented figure of 270, the in-house trade union said on Thursday.
Of the 1,481 workers planned to be laid off, 1,377 will be offered a new contract and the rest will be sacked, SKEI Gorenje said as it received the lay-off plan from the management.
Gorenje employs over 4,200 workers in Slovenia and abroad, and is amid reorganisation following last year's takeover by China's Hisense and EUR 37 million in net loss.
The union fears this is just the first step towards more lay-offs, which is in contradiction with Hisense's announcements about production expansion and new hirings.
It also insists that the former Gorenje management should be held responsible for the wrong decisions which had caused the group to sink into the red.
The union said social dialogue in the company was worrying; the management set the amount of the annual holiday allowance unilaterally, even if this is not in line with the collective bargaining agreement, noting the allowance was lower than in 2017.
The union blames such moves on the Slovenian advisers to the Chinese owners, which however risk falling out of favour with the employees.
Some trade unionists have according to SKEI Gorenje already received anonymous threats to be careful what they tell the media.
SKEI Gorenje thus announced it would fight for workers' rights with all means.
The management, on the other hand, said the new contracts had been checked by the trade union and some of its remarks taken into account.
The workers will start getting new contracts on Monday, a process planned to be completed by the end of June.
Earlier this year, Gorneje announced the majority of the planned redundancies would not affect production workers but cleaners, security staff and warehouse workers.
Meant to provide for Gorenje's sustainable growth and development, the reorganisation was said to apply to the entire group not the just the parent company in Velenje.
Gorenje generated almost EUR 1.2 billion in sales revenue last year, a 1.7% drop compared to 2017, finishing the year in the red.
STA, 25 April 2019 - Household appliances maker Gorenje expects to lay off 270 people as the group undergoes reorganisation following a recent change in ownership. The newspaper Večer meanwhile learnt from the in-house trade union that 1,720 people would be sacked, of which 1,450 would be offered new contracts.
The company, which employs a total of just over 4,200 people, and has recently been taken over by Chinese Hisense, said in a statement following the report by Večer that reduction staff in support services would be achieved through attrition.
Nonetheless, layoffs will not be avoided if the company will determine that there is no more need for a certain position.
The trade union meanwhile said it was willing to use any measure to fight layoffs and has called a press conference for tomorrow. It also refused to take part in talks about redundancy criteria, scheduled for today.
Nevertheless, Gorenje expects a new organisation scheme to be adopted in the first half of May. The next step will be to finalise the redundancies list and adopt a plan of action.
The trade union strongly opposes any moves toward redundancies since it believes the employees are not responsible for the company's poor business results.
It wants the company's management to take responsibility for the poor performance by initiating a procedure investigating liability of individual top managers.
Gorenje generated almost EUR 1.2bn in sales revenue last year, a 1.7% decrease compared to 2017. In 2018 the company sustained some EUR 37m in net loss, while it brought in a profit the previous year.
STA, 24 April 2019 - Economy Minister Zdravko Počivalšek visited the headquarters of Hisense, the owner of household appliances maker Gorenje, on Wednesday, the second day of his visit to China. He said Hisense would get the government's support in simplifying procedures and having its investments approved in Slovenia.
Počivalšek was received by Hisense group vice president Tang Yeguo and the delegation visited the manufacturing plant for cooling devices and the showroom, the company said in a press release.
Počivalšek's five day trip to China aims at boosting business ties. He is scheduled to meet the representatives of Liaoning Shenyang, where automotive maker TPV is to launch a new facility.
Slovenia has improved its visibility in China over the past five years, which is reflected in the continuous growth of trade between the countries, the Economy Ministry said in a press release.
China is Slovenia's most important trade partner in Asia and 13th overall, ranking before Russia and the US.
Nearly 12,600 Slovenian companies imported from China last year, while 475 exported to China, generating EUR 1.3bn, 11.8% more than the year before.
All our stories on Slovenia and China are here
STA, 25 March 2019 - Household appliance maker Gorenje, which was taken over by China's Hisense last year, reported EUR 1.184bn in group sales revenue for 2018, a 1.7% decrease. After ending 2017 in the black, Gorenje recorded a EUR 37.3m net loss in 2018, or EUR 111.2m when factoring in one-off and extraordinary events.
Earnings before interest, taxes, depreciation and amortization (EBITDA) fell by 53.5% to EUR 29.6m. Earnings before interest and taxes (EBIT) were EUR 28.2m in the negative after a EUR 12.1m plus had still been recorded in 2017.
"In the first half of the year, performance was consistent with the budgeted dynamics; in the second half, however, it was adversely affected by uncertainty among our partners with regard to the outcome of the strategic process, and it worsened as a result," Gorenje wrote, referring to the sale to Hisense.
The largest decline was seen in industrial (OEM) deals, "as customers trod very warily when doing business with Gorenje, for reasons referred to above".
Without the decline of OEM deals, revenue in Gorenje's core activity would have grown relative to the year before, said the company which employs slightly over 11,000 people.
As to the different net loss figures, Gorenje pointed out that assumptions and methodologies of accounting estimates changed considerably, with the "adjustment upon integration into Hisense having had many one-off and extraordinary effects on Gorenje results".
Gorenje generated 91% of its revenue in its core activity of domestic appliances. It primarily grew in eastern Europe, in particular in Hungary, Ukraine, Bulgaria, and the Czech Republic where it is marketing products under the Asko brand.
Revenue on the other hand decreased in western Europe, where the company felt the effect of strong competition and labour cost pressures.
"As sales decreased, results from operations were negatively impacted by the unchanged amount of fixed costs that were impossible to adjust to the lower-than-planned sales in such a short period of time," Gorenje wrote.
The company said it continued to invest in development, earmarking 2.5% of total revenue or EUR 30m for this purpose. The same amount was invested last year into marketing.
The core company increased sales revenue by 2.2% to EUR 819.3m but recorded a EUR 126.8m net loss after being EUR 470,000 in the black in 2017.
All our stories on Gorenje can be found here
STA, 1 February 2019 - Gorenje, the Velenje-based household appliances group which was taken over by China's Hisense last year, is cutting 325 temporary-basis jobs, according to information from the in-house trade union.
Gorenje confirmed that fixed-term contracts of 190 workers had elapsed, but the head of the in-house trade union Žan Zeba insisted that 325 jobs were being slashed, including agency workers.
Speaking with the STA, the head of the in-house trade union Žan Zeba said the news came as a negative surprise after the company's plans about expansion of production and extra hiring.
Zeba said the Gorenje management had promised the workers who are now being laid off full time jobs. He also said that it would be hard to meet the output goals given the current labour dynamics.
"After the very good test results of our new generation appliances we definitely expect production to increase and the capacities to be filled; we will welcome all new investments once they happen."
Zeba also hopes that the employees' wishes be taken into consideration in the company's reorganisation.
He said the management was planning to launch a new dishwasher production line in mid-year, but the trade union did not have any information about it.
Production of build-in freezers and fridges is to be moved to the subsidiary in Valjevo in Serbia in the coming months.
Denis Oštir, director of corporate communication at Gorenje, told the STA that the mentioned workers were on temporary job contracts. "These contracts have now run out."
"Gorenje denies in the strongest terms the information that we will lay off 325 workers. We will not give notice to a single worker employed on fixed or non-fixed terms," Oštir said.
After receiving official information from the staffing department, Oštir also denied that employment contracts of 325 workers had run out, saying the correct figure was 190 workers.
He added though that it "is true that the fixed-term contracts of a number of workers have elapsed at this time. This is a matter of seasonal change, which is common in a company's operations".
Oštir said the company was adapting to the clients' demands and seasonal trends in demand. At the end of 2018, demand for labour force in production was bigger because the company created stocks because of the move to Valjevo.
Asked about the plans for a new TV plant announced by the Chinese owners, Oštir said the project was in the phase of acquiring the necessary documents.
The plant is to be built by the existing warehouse in Velenje and is to create 300 to 400 jobs.
Gorenje is currently being transformed from a joint stock company into a limited responsibility company. The company delisted from the Ljubljana Stock Exchange last year.
STA, 22 September 2018 - Gorenje chairman Franjo Bobinac has told the newspaper Večer that after the takeover by China's Hisense, the household appliance maker remains a Slovenian company with headquarters in Velenje. He said that Hisense had great plans about growth of Gorenje, which meant a bigger production capacity and more jobs.
STA, 17 September 2018 – The Chinese firm Hisense, which acquired 95.4% in Gorenje earlier this year, has decided to squeeze out the remaining minority shareholders of the Slovenian household appliance maker. The group will delist Gorenje from the Ljubljana and Warsaw stock exchanges.
STA, 30 August 2018 - After acquiring the household appliances manufacturer Gorenje, China's Hisense is planning to build a TV manufacturing plant in Velenje, Slovenia, in an investment that Gorenje CEO Franjo Bobinac says will create several hundred new jobs.
STA, 24 August 2018 - Household appliance maker Gorenje reported on Friday a 3.5% drop in half-year sales revenue at group level to EUR 602.3m and a net profit of EUR 400,000, which is about a tenth of that in the same period last year.
STA, 16 August 2018 - The Velenje-based household appliances maker Gorenje, which is in 95% ownership of China's Hisense, expanded its management board on Thursday with six representatives of the owner, with Franjo Bobinac staying at the helm of the management board. Hisense also announced to withdraw Gorenje from the Ljubljana Stock Exchange.