IKON TO LAYOFF 1,500 JOBS/NORTH AMERICA

[Anonymous]

Ikon to cut about 5
percent of staff to trim costs

NEW YORK, March 05  – Ikon Office Solutions on
Tuesday said it would cut about 1,500 jobs in North America, or 5 percent of its
global work force, under a restructuring to trim costs and improve operating
income.

Ikon, which
provides office equipment such as printers and related services, said it will
stop providing off-site printing systems for business documents and close 17 of
its 82 legal document services sites.

It will also revamp its North American field
organization and corporate staff to focus on growth areas such as color printers
and professional services, which evaluate clients’ printing needs and suggest
machines they should buy or lease.

Ikon, which considers Xerox Corp. a rival, is the
primary U.S. distributor for Canon Inc.  and Ricoh Co. Ltd. and sells several Hewlett-Packard Co. machines. Ikon has
in the past few years focused on high-end products with greater margins as it
shed poorly performing assets and cut staff.

Ikon on
Tuesday also said it has sold almost all of its operations in Mexico. It will
retain sites in Mexico City, Monterrey and Guadalajara, and operate its
remanufacturing facility in Tijuana.

The
company expects to take charges of $38 million to $52 million, or 18 cents to 25
cents a share, for the actions.

Ikon said
it expects to take a significant portion of the charges in the fiscal second
quarter and the rest through the remainder of the fiscal year ending in
September.

The
company said it still sees a fiscal 2005 profit of 63 cents to 68 cents a share,
excluding one-time costs, and expects to fare better in fiscal 2006.

According
to Reuters Estimates, analysts on average are expecting 2005 earnings of 64
cents per diluted share, and 2006 earnings of 77 cents per diluted share.

Shares of
Ikon edged up 10 cents to $10.65 on the New York Stock Exchange shortly after
midday

[Author]

March 6, 2005 at 10:21 AM