Third-quarter revenue at Alcatel SA’s Optronics division could fall as much as 50 per cent compared to the previous quarter, the company warned Tuesday, announcing further cost cutting measures for the unit. The company will also be once again cutting its ties to Canada.
Blaming “continuing recession and persistent inventories at the customers’ level,” Alcatel said it would cut jobs at the unit that makes components for optical fibre networks to reach about 1,000 staff by the end of the year and under 500 at the end of 2003. The division currently employs 1,550 people, Alcatel said in a statement.
In July, Alcatel Optronics reported second quarter results with sales down by 83 per cent compared to the same period last year to US$25.2 million (as of June 30, the last day of the period being reported). On a sequential basis, sales for the second quarter declined by 27.6 per cent. Demand for fibre-optic networks has tanked after the boom two years ago with service providers today struggling to find customers.
Alcatel will slim down its plant in Nozay, France, by outsourcing, pooling resources with partners and spinning off activities, among other measures. In the U.S., Alcatel plans to sell its Plano, Tex., circuit board assembly plant before the end of the year, the company said.
Furthermore, Alcatel Optronics is leaving Canada. A research and development team focused on filters for terrestrial applications that remained after the closure of a factory in Gatineau, Que., in June, will be transferred to Livingston, Scotland, Alcatel said.
Alcatel first announced restructuring measures for the Optronics unit last year and reinforced those in June with further job cuts and the closure of some facilities, including one in Kanata, Ont. [Please see Alcatel Optronics shuts plants in France, Canada.]