4 February 1999: US-based adhesives and office products company Avery Dennison Corp. reported record 1998 fourth-quarter and full-year sales and earnings but said it would cut 1,500 jobs, or 9% of its…
4 February 1999: US-based adhesives and office products company Avery Dennison Corp. reported record 1998 fourth-quarter and full-year sales and earnings but said it would cut 1,500 jobs, or 9% of its work force, to reduce costs. The company said it would take a one-time restructuring charge of US$ 60-US$ 65 million, or US$ 0.40-0.42 per diluted share, in the 1999 first quarter to cover the cost of steps designed to increase operating efficiency and improve profitability. As part of a realignment of its cost structure, the company will close eight facilities and eliminate some 1,500 jobs, it said. The restructuring charge will include severance payments to workers, related asset write-offs and other one-time expenses, Avery said. “Avery Dennison has consistently delivered superior returns and earnings growth,” said Philip Neal, president and chief executive. “We expect this major realignment to position the company for double-digit earnings growth in 1999 and beyond, before the effects of the one-time charge.” Avery said diluted earnings per share in the fourth quarter were US$ 0.54, matching Wall Street analysts“ expectations and exceeding the US$ 0.52 earned in the same period last year. Sales grew 5.8% to a record US$ 884.6 million from US$ 836.4 million a year ago. Excluding the impact of currency translations, sales grew 5.2%. For the full year, earnings per share, on a diluted basis, increased 11.4% to US$ 2.15 from US$ 1.93, the seventh consecutive year of double-digit earnings-per-share growth. Sales increased 3.4% to a record US$ 3.5 billion from US$ 3.3 billion. Excluding the impact of currency, sales grew nearly 5%.