SCOTLAND:LEXMARK SHUTS CARTRIDGE PLANT
SCOTLAND:LEXMARK SHUTS CARTRIDGE PLANT
2006-01-26 at 10:28:00 am #13988
Lexmark shuts Rosyth(SCOTLAND) cartridge plant
(MAYBEE THE SCOTISH EX-LEXMARK EMPLOYEES CAN GO WORK IN JUAREZ-MEXICO FOR PEANUTS…SEE BELOW)
700 jobs to go as printer firm quits Silicon Glen
Lexmark is to close its inkjet cartridge manufacturing facility at Rosyth in Scotland with the loss of 700 jobs.
The first 500 jobs will go in April and the rest when the factory is
shut down towards the end of the year. Lexmark cited excess capacity
and the high cost of manufacture as reasons for closure.
“We truly regret the loss of jobs in this community,” said the plant’s general manager Alan Speirs.
“While we do not have the ability to change the impact of technology or
economics, we nevertheless recognise the challenges facing our
employees and their families.”
The Lexmark factory was opened 10 years ago and formed part of Scotland’s ‘Silicon Glen’ IT business area.
Lexmark’s recent financial results disappointed analysts after it cut
profit expectations. The company said that a collapse in demand for
printers and toner had hurt profits and further jobs cuts were expected.
Stung by sales drop, Lexmark to cut 825 jobs
2005 profit off 37% because of price war
Lexmark International Inc. yesterday blamed lower fourth-quarter profit on a sharp decline in sales of printers and ink cartridges, and the company announced it will cut about 825 jobs, including about 200 administrative positions in Lexington, Ky., its headquarters.
The nation’s No. 2 printer maker also said it would freeze its U.S. pension plan and compensate by beefing up workers’ 401(k) retirement plans. The changes are expected to save $50 million this year and $80 million annually thereafter.
Lexmark has grappled with an industrywide slump in inkjet and laser printer sales that has caused rivals Hewlett-Packard Co. and Canon Inc. to slash prices.
The cuts — especially for more profitable supplies like toner cartridges — caused Lexmark’s 2005 profit to plunge 37 percent.
Paul J. Curlander, chairman and chief executive, said the restructuring will cost $130 million.
The plan includes closing a plant in Scotland and moving about 525 jobs “primarily to low-cost countries.”
For the three months ended Dec. 31, the company reported that profit fell to $82.3 million, or 71 cents per share, from $155 million, or $1.18 per share, in the year-ago period.
The drop was pinned on a 12 percent decline in revenue to $1.4 billion, from $1.5 billion. The company said sales from its business and consumer segments fell due to price cuts and weak sales of supplies.
For the year, the company reported profit of $356.3 million, or $2.91 per share, on sales of $5.2 billion.
Wall Street cheered Lexmark’s restructuring, viewing it as making the company more competitive. The stock surged $5.18, or 11 percent, to close at $51.08.
“This plan to consolidate manufacturing, cut operating expenditures and freeze pensions seems like a bold step, in line with our optimistic views for possible savings,” UBS analyst Benjamin Reitzes said.
Lexmark will stop contributing to its defined-benefit pension plan, in which 3,500 employees in Lexington participate. The fund will continue to accrue interest, but the company will not add more to it.
Instead, Lexmark will increase its 401(k) contributions, matching at 100 percent the first 6 percent each employee contributes, up from a 50 percent match.
The majority of the job cuts come from the closure of an inkjet cartridge plant in Rosythe, Scotland, where 700 positions will be lost. Lexmark has 13,000 employees, 1,350 of whom will be affected through job eliminations or transfers.
lexmark :Growth of new plants impressive
6 million square feet of new plants in Juárez this year is a feat that
likely won’t be repeated next year, mostly because you don’t get a
1.5-million-square-foot Electrolux plant every year. But real estate
types said they are hoping for 3 million to 4 million square feet of
plants in 2006, still a very good thing. Best/White de Mexico said
250,000 square feet of construction has started this year and will be
operational next year.
The construction includes Building 3 of the Lexmark
campus, 92,000 square feet, to be completed next year. Buildings 1 and
2, finished this year, were a combined 362,000 square feet, said Andres
Sandoval, a Best/White partner in Juárez.