GREENVILLE, S.C. (AP) — Electronic capacitor maker Kemet Corp. said Thursday that it is cutting about 420 jobs to help it to return to profitability, announcing the move as it reported a worse-than-expected $17.8 million loss for its fiscal first quarter.
The job cuts amount to about 4 percent of the company’s workforce.
Blaming its sagging sales on the global economic slump, Kemet said the layoffs should result in cost savings of $16 million in the current fiscal year.
CEO Per Loof said in a statement disclosing the job cuts that “we believe that it is imperative that we react to the continued economic slowdown.”
Kemet intends to take a charge of $8 million to $9 million related to severance expenses, including $7 million in the quarter that ends Sept. 30.
The loss for the April-through-June quarter amounted to 40 cents per share and compared with net incomet a year earlier of $31.8 million, or 61 cents per share.
Excluding certain items, Kemet said the adjusted net loss was 20 cents per share for the latest period. That was 16 cents per share worse than the consensus estimate of analysts surveyed by FactSet.
Revenue was $223.6 million, down 23 percent from a year earlier though still above analysts’ estimate of $219 million.
Loof said revenue should remain stable in the near term but economic challenges remain daunting, especially in Europe.
Shares fell 32 cents, or 6.4 percent, to $4.69 in trading Thursday after reaching a low of $4.52, their lowest level in Kemet’s two years as a publicly traded company.
