Imation to slice 1,700 jobs, none in White City
Wire and staff reports
OAKDALE, Minn. -- In a move to improve profitability, Imation Corp. said Wednesday it will cut about 1,700 jobs this year, increasing its earlier projection of about 1,500 jobs.
The latest projection represents about 17.3 percent of the data storage company's workforce of about 9,800 in 60 countries at the end of 1997.
The layoffs will not affect Imation's plant in White City, according to spokesman Jason Thunstrom at Imation headquarters.
That plant handles the film for our Dry-View systems, which has been an industry success for three years now, he said. However, apart from our restructuring, all of our businesses are responsible for monitoring their markets responding to changes.
The company, formerly part of 3M Co., also repeated that it plans to sell its CD-ROM business, which had 1997 revenues of less than $70 million.
The details came as the Oakdale-based company announced a loss of $157.8 million for the fourth quarter, or $4.05 per diluted share, compared with a loss of $600,000, or 2 cents per share, a year ago.
Imation's shares were up $2.75 per share to $16.31 in afternoon trading on the New York Stock Exchange in afternoon trading.
While these actions are not easy for any of us, the restructuring is a necessary step to establish our company, said chairman and chief executive Bill Monahan.
Monahan said Imation, established as an independent company in July 1996, plans to complete most of the restructuring by July.
In addition to the staff cutbacks and selling the CD-ROM business, the company intends to restructure its European organization and consolidate manufacturing operations.
Fourth-quarter results included $200 million in pretax restructuring and special charges, the company said. Without the charges, it earned $900,000, or 2 cents per share. It reported revenues of $569.8 million for the quarter ended Dec. 31, down from $581.6 million a year ago.
Monahan said pricing pressures and competition in low-end data storage, printing plates and film, and conventional medical imaging hurt fourth-quarter results, as did the strong dollar.
For the year, the company had a net loss of $180.1 million, or $4.54 per share, on revenues of $2.2 billion. That's compared with a net loss of $20.5 million, or 49 cents per share, on revenues of $2.3 billion for 1996.