Itron Posts Loss, Plans Cutback Sluggish Sales Force Company To Eliminate About 100 Jobs

Itron Inc. will eliminate about 100 jobs by year end in response to a prolonged slowdown in orders for its automated meter-reading equipment.

Spokeswoman Mima Scarpelli said Wednesday half of the affected jobs are in Spokane, where the company employs almost 700.

A manufacturing plant in Minnesota will lose about 25 positions, with the remaining cuts to be scattered among various U.S. and foreign offices, she said.

Itron employs about 1,000.

Scarpelli said most of the jobs to be cut are white collar, notably product development and senior staff. Itron now has the products to meet market requirements for the foreseeable future, she said.

But, she added, the market has been tough.

“We continue to win most of the AMR business out there,” Scarpelli said. “It’s just that the AMR business is very slow.

“We haven’t lost business to a competitor.”

Scarpelli said most of the employees who will be affected by the cutbacks were notified Wednesday. The company will provide outplacement help and “fairly generous” severance, she said.

Also Wednesday, Itron reported a loss for the second quarter despite increased revenues. And Chairman Johnny Humphreys said the company may sustain a loss for the whole of 1998 as well.

“While we have received optimistic forecasts from many large customers, our current bookings do not support an increase in revenues during the last half of this year,” he said.

Order backlog also has slipped substantially, although sales for the quarter reached $60.8 million, a 15 percent boost from the same quarter in 1997. First-half sales jumped 33 percent to $124.5 million.

The loss for the quarter was $1.1 million, or seven cents per share, compared with a loss of $675,000, or five cents per share, a year ago.

For the first six months of 1998, the loss was $923,000, or six cents per share, compared with $3.9 million, or 28 cents per share, a year ago.

The company expects to take a charge of up to $3 million in the third quarter to cover the costs of restructuring. Humphreys said the moves should cut expenses by up to $8 million per year.

Analysts who follow the company had anticipated the quarterly loss, but the consensus expectation among those surveyed by First Call was an annual profit of about 17 cents in 1998.

Itron stock has been battered, and touched an all-time, intraday low of $11 per share Wednesday before rebounding to close at $12.50, up 62 cents.

JOB CUTS Product development employees and senior staff will feel the brunt of the reduction in force.