Technicolor plans to cut 600 jobs in 2012
Pascale Paoli-Lebailly ©RapidTVNews | 20-12-2011
French technology group Technicolor has announced it is considering a number of cost reduction action plans that should lead to a reduction in the Group’s global workforce of around 600 employees
Those “restructuring actions” are called to adapt the cost structure to what is “expected to be a continuing challenging macroeconomic environment in Europe throughout 2012” Technicolor commented in a statement.
Since October 2011, the deterioration in the European market which the Group saw in Q3 2011 has continued affecting principally its Digital Delivery business. In contrast, Technology and Entertainment Services are expected to report for the FY 2011 increased adjusted EBITDA compared to 2010. Technicolor anticipates overall stable year-over-year revenue growth from continuing activities in FY 2011 at constant currency, and forecasts an adjusted EBITDA of approximately €475 million. The Group confirms that it will generate a positive free cash flow in 2011.
Yet Technicolor anticipates results below expectations mainly due to Digital Delivery. This branch will report a FY 2011 adjusted EBITDA of approximately €39million, mainly due to Connected Home for around € 47million, which is €6million below previous expectations. The Technicolor action plan for 2012 is designed to reinforce its leading market position in the Americas, supported by recent customer wins in North America, particularly in the cable market, as well as continued robust demand from its Latin American customers. The group also expects to benefit from a solid growth in its Asian operations, especially in India and Australia. Overall market conditions in Europe are however expected to remain weak throughout 2012.
For its French Angers facility (330 employees), the group is soliciting potential partners to compensate for a drop in European orders. “A successful partnership agreement with a third party early in 2012 will be essential to ensure continued workload for this facility,” Technicolor assured.
Technicolor is also aiming to optimise its European photochemical film activitiesand plans to cease its photochemical film release print manufacturing operations in Rome, Madrid and London. London will maintain its front-end lab in London in accordance with the July agreement with Deluxe. This would enable the group to benefit from a highly flexible cost structure for its declining film release printing activities in Europe through a reduction of its annualised fixed costs by €24 million.