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Technology Stocks : Glenayre Technologies(GEMS)- a pure cellular PCS play?

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To: Kailash who wrote (3192)	9/10/1999 11:14:00 AM
From: Link Lady	Read Replies (1) of 3431

This looks negative still As I was in for a short time and still watching for something positive found this. I don't own any shares. vancouversun.com Glenayre shift to U.S. cuts 300 Vancouver jobs The Vancouver Sun Bruce Constantineau, Sun Business Reporter Vancouver Sun From 200 to 300 Glenayre Technologies employees in Vancouver will lose their jobs in the next six months as the financially-troubled high-tech company shifts its manufacturing operations to Illinois, company president Eric Doggett said Wednesday. "It's painful for everyone and it's not a decision we make lightly," Doggett said in a telephone interview from Boston. "Unfortunately it's a necessary decision to ensure we get the company repositioned and keep it viable." Glenayre, founded in Vancouver but now based in North Carolina, reported a loss of $101 million US for the first six months of 1999 compared with a $4.6 million loss a year ago. Sales during the first two quarters fell by 25 per cent to $132.1 million. The company's Vancouver facility employs about 650 non-union workers. Doggett said Glenayre will continue to maintain a strong presence in Vancouver with an operation dedicated to research and development and customer service. "It's more efficient to centralize manufacturing because we had two facilities [in Vancouver and Quincy, Ill.] that were very lightly loaded and we couldn't sustain the operating costs for both of them," he said. "It was making us non-competitive." Many critics feel high taxes and red tape in B.C. are driving companies such as Glenayre out of the province but Doggett said those factors had little impact in this case. "The tax rates were not so out of whack [in B.C.] that they were a major impact in this decision. Quincy makes some of Glenayre's more complex products and its ability to assume the manufacturing that Vancouver was doing was greater than the ability to do the reverse." Doggett said Glenayre might need to hire a few more people in Illinois but feels the move to centralize manufacturing will result in a "very significant" reduction in the company's workforce. Glenayre employs more than 2,000 and the company estimated earlier this year that restructuring costs in the third quarter this year will range from $10 million US to $15 million. A recent Credit Union Central of B.C. report said B.C. needs to do more to support high-tech industries because employment growth in the sector fell to 5.2 per cent last year from 7.3 per cent in 1997. "It is likely that high tax rates have contributed to the outflow of high tech workers from B.C.," the report said.

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