Diebold posts Q1 net loss; cuts 700 jobs
01 May 2013 | 9558 views | 0
Struggling ATM manufacturer Diebold is axing around 700 jobs, mostly in North America, as part of a 'realignment plan' designed to save up to $150 million.
News of the plan came as the company reported a "disappointing" first quarter net loss of $13.4 million, or $0.21 a share.
Diebold - which ousted CEO Tom Swidarski in January - says that most of the 700 full-time positions, primarily in North American and corporate operations, affected have already gone.
In addition, operations in Lynchburg, Virgina, and Lexington, North Carolina, are being sold to long-time materials supplier Porter's Group and a new more centralised management structure is being brought in.
The multi-year global realignment is aimed at reducing its cost structure by $100 million to $150 million, with a "portion" of the savings reinvested in research, development and systems and infrastructure.
First quarter restructuring charges of approximately $10 million have already been incurred, with another $15 million to $30 million in costs expected to follow.
George Mayes, EVP and COO, Diebold, says: "The process of change management is challenging, and it entails making difficult decisions. These difficult but necessary actions represent significant changes to our overall cost structure and organisation."
The company swung from a first quarter 2012 net profit of $45.2 million to a Q1 net loss of $13.4 million this year. Revenues of $633.5 million were down 9.3% on Q1 2012.