ROSYTH DOCKYARD operators Babcock plan to cut 1,000 jobs over the next 12 months.

The shock announcement came in an update for the financial year ending in March.

There is currently no indication as to how many, if any, posts will be axed in Rosyth.

In its business update, the company stated: "We are changing our operating model to create a business that is more efficient and effective.

"We are reducing layers of management within the business to form a simpler, flatter structure that will simplify how we operate, improve line of sight, shorten communication lines and therefore increase business flexibility and our responsiveness to market conditions.

"This will reinforce a one company culture and remove the duplication and lower quality delivery that a siloed approach delivered.

"This, unfortunately, will result in headcount reductions. We are also reducing the Group’s property portfolio, especially in the UK.

"The changes will result in approximately 1,000 employees leaving the Group within the next twelve months with an approximate restructuring cost of £40 million, most of which are cash costs.

"This will reduce our overall operating cost base. Some of the savings will be recognised across long-term projects, for example where they form part of existing contract efficiency assumptions, and some savings will benefit our customers via the contract structure."

Draft unaudited management results show for year 2021, underlying revenue of £4,690 million, down from £4,872 million in 2020, wirth underlying operationg profit of £307 million for 2021, down from £524 million in 2020.

The company added that it would be rationalising the group's portfolio by "divesting certain businesses", adding, "We anticipate this will generate proceeds of at least £400 million over the next twelve months."

David Lockwood, CEO, said: “We announced a series of reviews in January and promised to report back on our strategic direction, a new operating model and a new financial baseline at our full year results.

"Today we give you an update on all of these areas. The early results from our reviews show significant write-offs and a smaller ongoing reduction in the profitability of the Group.

"Through self-help actions, we aim to return Babcock to strength without the need for an equity issue. We are creating a more effective and efficient company through our new operating model and, in line with our new strategic direction, will rationalise the Group’s portfolio to help strengthen our balance sheet.

"Through our new operating model, the future Babcock will be a better place to work, a better partner to our customers and will be well placed to capture the many opportunities ahead of us.”