Advanced Energy Announces Workforce Reductions
Advanced Energy Industries, Inc. announced a reduction in workforce and other cost reductions. In response to the deteriorating economic conditions and weakening demand from the company’s end markets, the company is reducing its global workforce by approximately 330 people or 22% of total headcount across all functional areas and geographies and lowering the salaries of management and executive officers by an additional 5%, totaling 15% overall, effective April 1, 2009.
"While we were hopeful that conditions would begin to stabilize, the markets we serve have nonetheless continued to deteriorate," said Dr. Hans Betz, President and Chief Executive Officer. "This has led us to take additional cost reduction measures in order to streamline our operations, and enable us to continue to focus on key market opportunities."
These cost reductions are expected to reduce salary costs by approximately $8.2 million annually. These measures along with other discretionary spending reductions, will result in approximately $21 million of savings over the next three quarters, and will lower the company’s breakeven point to $55 million by the end of the second quarter of 2009. Total restructuring charges, including those from cost reductions announced in December, will be approximately $3.8 million in the first quarter of 2009 and approximately $800,000 in the second quarter of 2009.