Polarcus (Polarcus) further improves its cost position with the announcement of additional headcount reductions and changes to the executive management team. The expanded cost reductions are part of a longer term plan which will continue to improve competitiveness while maintaining exceptional operational performance and sustaining positive operational cash flow. The plan provides the Company with a business model to withstand a prolonged difficult market as well as to take advantage of opportunities in this volatile environment.
As part of the comprehensive cost management program implemented at the end of 2014, personnel reductions now total 26%. This additional reduction of 15 employees are all office staff and include executive management positions to fit a redefined Polarcus. Cost savings as a result of these recent personnel changes plus additional other overhead cost reductions will total USD 7 million annually, excluding one-off restructuring costs which will be incurred in Q1 2016.
Chief Financial Officer, Tom Henrik Sundby and Senior Vice President Human Resources, Dr. Paul Hanna have made the decision to leave the Company. Additionally, Peter Zickerman, Executive Vice President Strategic Investments and Company founder, has moved from being an employee to a consultant as strategic advisor to the Company. The Executive Vice President Strategic Investments and Senior Vice President Human Resources executive management positions are eliminated as a result of these changes.
Effective 1 March 2016, Hans-Peter Burlid will be promoted to the position of Chief Financial Officer. Mr. Burlid currently serves as Vice President Finance & Investor Relations for Polarcus, an executive management position which will be eliminated. He has 12 years of experience in the seismic industry with key roles in finance, accounting and business development and was instrumental in the start-up of Polarcus. Mr. Burlid holds a B.Sc. in Economics and Business Administration from Blekinge Institute of Technology, Sweden.
"Firstly, I want to thank all those employees departing the Company for all their hard work and dedication. It is always a difficult decision to see the departure of high-quality employees, but the current market environment requires us to continuously review and adjust our cost structure," stated Rod Starr, Polarcus CEO. "I am also appreciative of the leadership provided by executives Tom Henrik Sundby and Paul Hanna. They were both here in the early days and played important roles in the development of Polarcus, and I wish them the very best in their future endeavors. Continued strategic advice from Peter Zickerman will be an important element as the Company maintains an eye on future growth opportunities."
The continued aggressive cost management program combined with leading vessel backlog, operational excellence and innovation and recently announced financial restructuring ensures Polarcus is well positioned to ride out a prolonged market downturn.