About 350 Hill-Rom positions will be cut in the United States and Europe, representing 5 percent of its global work force, according to a Jan. 23 company news release written by Acquire Media about first quarter results and the revised 2014 outlook, which showed first quarter revenue of $393 million declined 8 percent vs. the prior year.
Leaders are implementing a comprehensive restructuring program that will include streamlining operations in the United States and Europe, including establishing a shared services center in Europe; reduction of European manufacturing capacity, with the planned closure of one facility and downsizing of capacity throughout its remaining European manufacturing network, the report stated.
John Greisch, Hill-Rom president, said in the news release, "This quarter demonstrates the inherent volatility and current challenges in our capital equipment markets. We are clearly disappointed by our weaker than expected results. However, we remain committed to driving long-term margin improvement through aggressive management of our operating cost structure, as demonstrated by the restructuring actions we announced today. At the same time, we will pursue improvements to our portfolio, in a manner consistent with our disciplined capital allocation framework, in order to continue to deliver value to our customers and shareholders."
The company anticipates substantially completing the domestic portion of the restructuring now through March. The European restructuring is expected to be completed over the next two years.
When all actions are done, savings are expected to be approximately $30 million annually. Savings in 2014 are expected to exceed $8 million, excluding restructuring charges. Restructuring charges are expected to be about $50 million, with $15-$20 million to be incurred in the next few months.
The Herald-Tribune is awaiting company response about this action's impact on Batesville personnel.