IKON CUTS 350 JOBS……PROFITS FALL 44%

[Anonymous]

Ikon cutting 350 jobs, 1Q profits fall 44%
Ikon Office Solutions Inc. said Thursday it is eliminating 350 jobs and cutting its management’s bonuses because of disappointing results in its fiscal 2008 first quarter and to accelerate its cost-cutting efforts.The company did not say where the jobs being cut are based.

Ikon  also said Wednesday night that it has created a new operating unit for the United States and named Jeffrey W. Hickling president of it. The move gives Ikon three operating units — Ikon U.S., Ikon Canada and Ikon Europe.The Malvern, Pa., supplier of copiers, related equipment and document-management services took a pre-tax charge of $7 million, or 4 cents per fully diluted share, in its fiscal first quarter, related to the job cuts and other efforts to reduce its spending.With that, Ikon earned $15 million, or 13 cents per fully diluted share, in the quarter, which ended Dec. 31, 2007. That’s down 44 percent from $27 million, or 21 cents per fully diluted share, in Ikon’s fiscal 2007 first quarter.Ikon’s revenue in its fiscal 2008 first quarter was $998 million, down slightly from $1 billion in the first quarter of its 2007 fiscal year.Ikon originally had expected to earn 22 to 24 cents per fully diluted share in its first quarter, but lowered those expectations to 15 to 17 cents on Jan. 10.Ikon Chairman and CEO Matthew J. Espe said the company’s equipment revenue in North America was lower than expected and its tax rate was higher than expected.The steps Ikon is taking to reduce costs should lower its expenses by $25 million in fiscal 2008, Espe said. 

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February 14, 2008 at 2:00 PM