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To: steve dietrich who wrote (375973)	3/21/2003 4:33:40 PM
From: Baldur Fjvlnisson	Respond to of 769667

Biggest contract manufacturer Solectron cutting 12,000 Cuts equal to 16% of work force are meant to shed $300 million in costs; another loss reported. MILPITAS, Calif. - Solectron Corp. said Thursday it will slash 12,000 jobs, or 16 percent of its work force, to help cut $300 million in costs as it struggles with fierce competition in the low-margin business of making tech and electronic products for name-brand companies. The company, the biggest contract manufacturer, also said it would shed some 3 million square feet of manufacturing space over the next several quarters. The company did not specify how long the cuts would take, which will depend on country-specific labor laws. But it said it will have 13 million square feet of manufacturing space and a work force of about 62,000 when the cuts are completed. The news came as Solectron reported a net loss of $111 million, or 13 cents a share, for its fiscal second quarter, compared with a net loss of $126 million, or 15 cents a share, a year earlier. Excluding pretax restructuring charges of $57 million, an inventory charge of $76 million and a $4 million gain from the repurchase of debt, Solectron reported a loss of $10 million, or 1 cent per diluted share, in line with consensus estimates according to earnings tracking firm First Call. Sales fell to $2.8 billion from $3 billion a year earlier amid a slow market for tech products, which Solectron builds for brand-name manufacturers such as IBM and Hewlett-Packard Co. According to First Call, analysts were expecting sales of $2.95 billion. Milpitas, Calif.-based Solectron also said it sees third-quarter sales of $2.6 billion to $2.9 billion, and a loss before charges in a range of 1 cent to 4 cents a share. Solectron stock tumbled 16 cents to $3.25 in after-hours trading, a drop of 4.7 percent, after falling 7 cents during the regular session. Copyright 2003 Reuters All rights reserved.