Invacare announces restructuring plan
ELYRIA, Ohio – Invacare will reduce its workforce by almost 200 employees as part of a restructuring plan, it announced yesterday.
The company will cut 150 employees and 40 temporary employees from its North America/Home Medical Equipment, Institutional Products Group and Asia/Pacific divisions, according to a press release.
About 60 of those employees work at the Elyria corporate headquarters and the Taylor Street manufacturing plant, according to Crain’s Cleveland Business.
The cuts will save $14 million to $15 million annually, according to the release.
“While the decision to downsize our workforce is extremely difficult, it is a necessary step in light of our financial results for the first six months of 2014 and the slow sales start to the third quarter,'' said Robert Gudbranson, interim president and CEO.
Invacare recently reported a loss in net earnings of $31.6 million for the first half of the year compared to net earnings of $22.7 million for the same period last year. It reported net sales of $640.4 million vs. $676.2 million.
For North America/HME, the company reported a loss in net revenues of $28.4 million, excluding restricting charges, for the first six months of the year compared to $19.8 million for the same period last year. It reported net sales of $267.8 million vs. $311.2 million.
Invacare has struggled under the weight of a consent decree with the Food and Drug Administration (FDA) that has limited manufacturing at the Taylor Street plant. The company is trying to complete a third and final audit to comply with FDA regulations.