Zumtobel axes 600 jobs to boost profit margins
The Austrian company, which is striving to switch to LED lighting from traditional lightbulbs, said its margin for adjusted earnings before interest and tax (EBIT) should improve from around four percent to five to six percent in 2014/15 and eight to 10 percent by 2016/17.
The job cuts will be achieved during the next few quarters by merging some plants and sales operations. The cost-cutting measures will entail restructuring costs of 15 to 20 million euros in the fourth quarter ending this month and will involve similar restructuring costs in 2014/15,
Zumtobel, which hired ex-Infineon manager Ulrich Schumacher as chief executive after its two top executives quit in August 2013, currently makes about three percent of the company’s sales in the Americas but when announcing the cost-cutting initiative this week at the Light + Building 2014 event in Frankfurt Schumacher commented: "For the USA, we have two options: shut it down or look for a partner."
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