Less employment, more coal in the new JSW program

Less employment, more coal

JSW announced the adoption of the document covering the years 2026-2035 in a statement on Monday.

The company wants to increase coal production from 13 million tons in 2025 to 14 million tons in 2029. The program assumes increasing the share of coking coal in total production and reducing the cash cost of coal mining from PLN 738 to PLN 560 per ton in 2029. Employment at JSW SA may decrease from over 20,000 to to less than 16 thousand employees.

As JSW representatives emphasized, the Program adopted by the company's management and supervisory board is intended to ensure the JSW Group's long-term improvement in profitability, security of financial liquidity and adjustment of the scale of operations to market and operational conditions. It assumes both actions to stabilize the financial situation in the short term and solutions that are intended to permanently improve the efficiency of the JSW Group's operations.

"The most important elements of the Program include activities improving financial liquidity, including obtaining prepayments or selling selected assets, deferring payments to ZUS, reducing investment outlays, optimizing operating costs, adjusting the employment level and a catalog of initiatives related to improving efficiency in key areas of the Group's operations," JSW said.

"We reduce costs, improve efficiency"

As Bogusław Oleksy, president of JSW, quoted in the announcement, said, the Recovery Program sets the course of action leading to a lasting improvement in JSW's situation. The idea is to create conditions for the stable operation and development of this company, regardless of market conditions.

A significant part of the initiatives provided for in it have already been implemented, we are reducing costs, improving efficiency, adjusting employment and taking steps to ensure stable financing. We are looking forward to the consistent implementation of dozens of subsequent initiatives covering all key areas of JSW's operations, said the president.

The program assumes an increase in coal production from 13 million tons in 2025 to 14 million tons in 2029. In the following years, production is to be maintained at 14.1 million tons. At the same time, JSW plans to increase the share of coking coal in total coal production, from 85 percent. in 2025 to 94 percent in 2029. An important goal is also to reduce the cash cost of coal mining. According to the assumptions of the Program, it is to be reduced from PLN 738.02/t in 2025, to PLN 587.86/t in 2026 and to PLN 560.16/t in 2029.

Comprehensive portfolio review

The company's representatives informed that as part of the preparation of the Program, a comprehensive review of the JSW Group's investment portfolio was carried out. As a result, investment outlays in 2026-2029 were limited to approximately PLN 2 billion on average annually. "The expenditure levels adopted in the Program are also intended to secure the achievement of the assumed production volumes. This means concentrating funds on investments necessary to maintain and develop production capacity while ensuring the safety of employees," JSW added.

The company's representatives pointed out that the reorganization of the operations of JSW plants is also an important change. "Integration of plants will enable a more flexible response to market needs. In practice, this means effective implementation of mining plans, reducing downtime and increasing production predictability. Integration of production management is also intended to facilitate the development of an appropriate product mix, including maintaining stable quality parameters of coking coal. This is important for maintaining trade relations and strengthening the competitiveness and stability of JSW's supplies," the release said.

Covering mechanisms

One of the elements of the Recovery Program is also the adjustment of the employment level to the target production volume. JSW uses protective mechanisms, including mining holidays, leaves for employees of coal mechanical processing plants and one-off severance pay.

According to the assumptions of the Program, in 2026 a total of up to approx. 4.2 thousand may benefit from the protective instruments. JSW SA employees. It is assumed that in this group there are over 3,000. people will be able to take advantage of mining or processing holidays, and almost 1.2 thousand from one-off cash severance pay. As a result, employment at JSW SA may decrease from over 20,000. to less than 16 thousand employees. The departure process is conducted taking into account the safety and continuity of mining, in a way that guarantees the safe and uninterrupted operation of JSW plants.

The company emphasized that the Recovery Program covers not only JSW, but also the companies of the Capital Group. An important element is the recovery plan prepared by JSW Koks. It assumes stabilization of coke production at the level of 3.4 million tons per year, as well as optimization of employment, adjustment of the structure of operations and assets to the target operating model, and strict cost control.

JSW is the largest producer of coking coal in the EU and one of the producers of coke used to melt steel. It mines in the following mines: Borynia-Zofiówka, Budryk, Knurów-Szczygłowice and Pniówek. The company is listed on the Stock Exchange.

JSW is restructuring in connection with the decision announced last year. risk of loss of liquidity. In February, JSW concluded an agreement with the unions to reduce labor costs. In June this year JSW's general shareholders agreed to establish security for taking out a PLN 850 million loan from the Industrial Development Agency, and in August the company announced that it intended to apply to the Industrial Development Agency for a loan of up to PLN 1.066 billion. JSW also benefits from statutory protections for its staff: one-off severance pay and mining and processing holidays.