Itron to trim workforce 7.5% in broad restructuring
Liberty Lake-based Itron Inc. is undertaking a broad restructuring, cutting about 7.5 percent of its global workforce and shutting six manufacturing sites, the company said today.
Most of the planned manufacturing closures are in Europe and in Latin America, said Itron CEO LeRoy Nosbaum. One production plant in Asia will also be closed.
One not-yet-identified U.S.-based production facility will also close, Nosbaum said.
Liberty Lake, with about 500 workers, is not affected in this reduction, Nosbaum added. Itron is considered the leading manufacturer of metering systems and software services for the utility industry.
The plan will eliminate 750 jobs worldwide out of a total of 10,000.
Those layoffs will be either in the closed production sites or seven other facilities that will downsize.
At the same time, the goal is to increase overall production capacity by consolidating work and investing money in new technology at other key production sites, said Barbara Doyle, vice president of investor relations for Itron.
“We will move work to other sites and actually be adding workers to provide more production capacity” than Itron now has, Doyle said. She said the increased production will come online in 2013.
The sites to be shut down in Europe include some acquired by Itron in 2007 when it bought Brussels-based Actaris Metering Systems.
“As time moved on, it turned out we realized we could consolidate those (Actaris) locations,” Nosbaum said.
The bottom-line impacts will begin to be felt in 2012, with a projected savings of $15 million the second half of next year and $30 million in 2013, a company press release said.
In its third quarter earnings released today, Itron reported quarterly and nine-month net losses of $12.70 and $11.21 per share, but those resulted from a $10 million goodwill charge and $25 million in warranty costs that affected the quarter’s balance sheet, said Nosbaum.
If one backs out those non-typical charges, Itron’s non-GAAP quarterly earnings came to a profit of 92 cents per share, Nosbaum said.
“We’re making plenty of money, that’s not the problem,” he added. The restructuring is all about streamlining and making Itron’s global facilities more efficient, he added.
Shares of Itron stock gained $3.19 or 9.8 percent in trading today.