December 7, 2006 -- Belden has announced plans to further restructure its North American manufacturing operations and to reduce its worldwide production overhead and SG&A expenses.
The company will cease production activities in its plant in Pointe- Claire, Quebec by midyear 2007. Other company facilities will assume the data networking cable production of the plant. However, maintaining its center for enterprise networking technology, the company will continue its research, engineering, marketing and customer service activities in Pointe- Claire.
By mid-2007, Belden will also cease production activities in Wheeling, Illinois. This facility manufactures lead and hook-up wire as well as a variety of multi-conductor cable configurations. The company says it will continue to provide these products under the Manhattan-Dearborn brand, with production activities assumed by other company locations.
According to a press release, the company will satisfy the terms of the labor agreements at each location, both of which are part of the company's Belden Americas division. In addition, the company announced that it will reduce production overhead and selling and administrative costs worldwide through position eliminations. The number of associates affected by the announced actions is approximately 325.
"We regret the impact of these actions on the affected associates. But this is a difficult, if necessary, step in the implementation of our regional manufacturing strategy," comments John Stroup, president and CEO of Belden. "And the expected ongoing $14 million annual efficiencies associated with these actions are an integral part of maintaining and improving our global competitiveness, while positioning us to better weather demand volatility."
In June 2006, the company announced plans to close manufacturing facilities in Fort Mill, South Carolina and Tompkinsville, Kentucky, and to transfer most of the production of those two facilities by mid-year 2007 to a new plant under construction in Nogales, Mexico.
In connection with the actions announced today, Belden expects to incur severance charges of approximately $10 to $12 million pretax and non-cash asset impairment charges of $3 to $5 million pretax, substantially all of which will be recognized in the 2006 fourth quarter. The after-tax impact will be between $0.15 and $0.20 per diluted share.
The company plans to provide 2007 guidance when it reports fourth-quarter earnings. For more information, visit the company's Web site, www.belden.com.
