Oxford Instruments PLC said it is closing one site in the US and one in Denmark in a move to cut costs in the current uncertain environment, with the loss of 230 jobs, or 15 percent of its workforce.
In an interim management statement covering the period from October 1 2008 to February 12 2009, it said performance was in line with the board's expectations and above the same period in the prior year with revenues being aided by favourable currency movements.
However, Oxford Instruments’ supply chain partners come under pressure within their own businesses and customers re-examine the timing of their purchases. It has also seen a slowdown in order intake in its businesses serving industrial markets.
The company plans to close its site in Chicago before the year-end and move its operations to the company’s other sites in the US and to its facility in China. It will also close the facility in Hobro, Denmark, and move those operations to High Wycombe in the UK.
It has also decided to curtail further research and development in the area of Hyperpolarisation within the BioTools division, due to the significant reduction in research and development spend within the pharmaceutical industry.
Cash savings from these changes are anticipated to be in the region of £11.4 million for the financial year to March 2010. The one-off charge of these redundancies and associated write downs is expected to be of the order of £7.8 million in the current financial year.
Net debt at the end of January stood at £36.4 million. This is supported by a 5 year revolving credit facility of £50 million which runs until July 2012 and additional overdraft facilities totalling £15 million.