PT Announces Job Cuts
The program is expected to reduce operating expenses by approximately $4.0-4.5 million on an annualized run rate basis. It includes the elimination of approximately 22 positions which represents 12% of the Company's workforce and is projected to be largely completed by the end of the second quarter of 2011. The Company expects to incur a pre-tax charge of approximately $0.9 million in the fourth quarter of 2010 and $0.1 million during 2011 for severance and other costs related to this program. These costs are expected to require an outlay of cash of $0.9 million and $0.2 million during the first and second quarters of 2011, respectively.
"During 2010 we made significant strategic investments aimed at underpinning a solid foundation for long-term future growth," said John Slusser, President and Chief Executive Officer. "However, based upon the expectation that we may well continue to face a challenging and unpredictable business climate in the near term, we are taking prudent steps to reduce our going forward cost structure. The action announced today will substantially reduce our operating expenses while fully retaining the resources necessary to meet our ongoing customer commitments, further strengthen our product offerings, and continue to deliver excellence in customer support."
The Company will provide more details of the restructuring announcement during its regularly scheduled quarterly earnings call in early March 2011. All savings and charges indicated in this press release are estimates and subject to change.
Performance Technologies Inc. (Nasdaq: PTIX)