Monday, February 3, 2014

Dell with 15 ,000 jobs set to be cut heads February list of layoffs and business closings ! Where is the job creation ?

Sony exits PC business, warns of full-year loss

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Published: Thursday, 6 Feb 2014 | 1:05 AM ET
Robyn Meck | AFP | Getty Images
Sony on Thursday unveiled major restructuring measures to turn its fortunes around, including exiting its PC business and spinning off its TV operations, but warned that it expects to post a full-year loss as a result of the overhaul.
The Japanese tech giant confirmed that it will sell its struggling PC unit to investment firm Japan Industrial Partners. Financial terms of the deal were not disclosed but Sony said it will take a 5 percent stake in the new outfit.
Meanwhile, Sony's flagship TV manufacturing business – that has lost $7.5 billion over the last 10 years – will be spun off by July this year, it added.
The announcement came as Sony reported much better than expected corporate earnings. Net profit for the nine-months ending December 2013 came in at 11.17 billion yen ($110.3 million), much better than a Reuters forecast for a loss of 110 billion yen.
Sony to benefit from cost cutting: Euromonitor
Mykola Golovko, Global Consumer Electronics Industry Analyst at Euromonitor International, says cost cutting in sectors like television, is an ideal short term solution for Sony.
Sony said it will cut around 5,000 jobs in its TV, PC, marketing and other departments, which will trim 100 billion yen a year in fixed costs starting fiscal year 2015-2016.
But in the term term, the restructuring will push the company into the red – Sony now expects to post a net loss of 110 billion yen for this fiscal year. It's previous forecast was for a 30 billion yen profit.
Exiting the Vaio PC business Sony founded 17 years ago will mark the first time Chief Executive Officer Kazuo Hirai pulls a major consumer product line.
This follows Sony's disposal of assets such as its New York headquarters and a major building in Tokyo last year.

Volvo to cut thousands of jobs

Volvo said it will lay off 4,400 employees in 2014, including the previously announced reduction of 2,000

Vehicle maker AB Volvo said its profits fell by 37% in the fourth quarter and it will lay off 4,400 employees in 2014, including the previously announced reduction of 2,000.

Volvo's chief executive Olof Persson said in a statement today the job cuts will affect employees worldwide.
Mr Persson said the cuts will help Volvo utilise its resources more effectively and are a consequence of the transformation the company is undergoing.
Volvo said fourth-quarter net profit fell by 37% to 548 million kronor (£51.5 million) from 869 million kronor a year earlier. Sales for the period rose by 8% to 76.6 billion kronor from 70.8 billion in the fourth quarter 2012.

Howard University to cut about 200 staff positions

Doug Kapustin/FOR THE WASHINGTON POST - File: Students study in the Louis Stokes Health Sciences Library on the campus of Howard University. The university has announced that it plans to cut about 200 staff positions.
Howard University is cutting about 200 staff positions during the next several months, a university spokeswoman said, reducing its workforce by nearly 4 percent.
Howard spokeswoman Kerry-Ann Hamilton described the cuts, which began Thursday, as “enterprise-wide.” She said the university “worked carefully to ensure no changes in public safety” and to “preserve services in student-facing and clinical areas.”
There were no details available on what positions will be cut and how many layoffs might result. Howard, a 10,297-student university that also operates a teaching hospital in Northwest Washington, has faced several fiscal challenges during the past few years.
The university has 5,474 employees, including the hospital’s staff, Hamilton said.
WAMU (88.5 FM) reported Jan. 24 that some university maintenance workers staged a rally to protest outsourcing.
“The university continues to pursue comprehensive strategies to enhance and achieve operational efficiencies as we provide excellent educational, research and clinical environments,” Howard said in a statement issued through Hamilton. “This includes difficult but necessary actions as we realign and re-engineer our workforce at the university and the hospital.
“This is an ongoing effort as the university carefully implements our strategic plan to address quality and efficiency including workforce realignment, streamlining procurement processes and seeking partners to support our non-core functions.”
On Oct. 1, Sidney A. Ribeau announced his retirement as the university’s president. The interim president is Wayne A.I. Frederick, who was provost under Ribeau.

500 layoffs expected today at Time Inc.

Tuesday is D-day at Time Inc.
Around mid-morning, staffers are expected to start hearing how deep the cuts will be as Time Inc. CEO Joe Ripp unveils what is likely the last big downsizing before Time Warner spins off the publishing group as a separate company later this year.
“It’s very nerve racking,” said one source inside the company that publishes People, Time, Sports Illustrated and In Style.
The recently acquired American Express Publishing and the London-based IPC subsidiary, are expected to be particularly hard hit.
American Express Publishing, with about 400 people, was taken over by Time Inc. in Oct. The company headed by CEO Ed Kelly has been highly profitable, but many of its production and business operations are redundant now that it is part of Time Inc. and are expected to be on the chopping block.
AmEx produces Travel & Leisure, Food & Wine, and Departures. Staffers at Executive Travel, a magazine mailed free to AmEx platinum card holders, are expected to be told today that the magazine will be closed down.
Time Inc. has about 7,800 people. The downsizing today is expected to be roughly equivalent to the one that former CEO Laura Lang unleashed a year ago, when about 500 people — roughly 6 percent of the workforce — were axed.

Radioshack Celebrates One Year Anniversary Of Closing 500 Stores By Closing 500 More

Tyler Durden's picture

If it seems like it was exactly a year ago that turmoiling retailer Radioshack shut down 500 stores due to lack of consumer interest in its wares (and or consumer disposable cash), it is because it was. So how does Radioshack demonstrate its morbid sense of humor on the one year anniversary of said announcement? Well, by closing another 500, or about 12% of the retailer's total 4500 outlets currently in existence.
The WSJ reports that the company which once was the butt of all LBO-rumor jokes (and still is, only this time in the context of an M&A-rumor with JCPenney and/or the Joseph A. Wearhouse joint venture), is "planning to close around 500 stores in the coming months as the electronics retailer continues working with advisers to restructure the company."
RSH's pre-bankruptcy operation problems are well-documented. And funded - "in October, RadioShack secured $835 million in loans to refinance about $625 million of debt. Those funds, from a group led by GE Capital, also freed up cash for RadioShack's overhaul." Of course, when said overhaul fails, the loans rolls into a DIP loan which funds the company's bankruptcy.
As was well-documented during the Super Bowl, the Fort Worth, Texas, retail chain has been working on transforming its image from an old-school electronics store into a destination for shoppers looking for entertainment gadgets, like headphones and smartphone cases. Sadly, it appears to not be working.
The retailer has struggled to reverse a string of losses deepened by a sales strategy focused around smartphones, which failed to improve revenue over the past two years.

RadioShack executives last year suggested the company would resist downsizing its store footprint as they focused most of their attention on reinventing the brand's image. Stores might close in one section of a neighborhood to set up shop in more highly trafficked locales, but the number of outlets would stay the same, they had previously said.

"I think we're a 4,000-plus network," RadioShack Chief Executive Joe Magnacca said in a November interview. "My job is to make sure that we've got the market covered."
That, or a '0-precisely network.' And while the Shack struggles to find just what market it is that it covers, if any, the population will enjoy how it spends several months of cash flow on amusing Super Bowl gimmick ads such as this one which is a fitting - and hilarious - epitaph of what happens to every retailer that stop adapting to its current environment.

Finally, while the ultimate fate of Radioshack is quite clear to most, a far more important topic is what happens to all the commercial real estate secuiritizations and/or malls that currently have a RSH location which is about to shutter. Then again, this is the new normal, and things such a fundamentals and cash flows are merely an irrelevant footnote.

Dude, "It's Going To Be A Bloodbath": Newly Private Dell To Fire 15,000

Tyler Durden's picture

Curious why Michael Dell was so eager to take the company he founded private? So he could do stuff like this without attracting too much attention. According to the Channel Register, the recently LBOed company is "starting the expected huge layoff program this week, claiming numbers will be north of 15,000." Of course, with a private sponsor in charge of the recently public company, the only thing that matters now is maximizing cash flows in an environment of falling PC sales, a commoditisation of the server market and a perceived need to better serve enterprises with their ever-increasing mobile and cloud-focused IT requirements - things that do not bode well for Dell's EBITDA - and the result is perhaps the largest axing round in the company's history. But at least the shareholders cashed out while they could.
More on the upcoming layoffs:
We heard from people close to the Round Rock Dell HQ area that Dell management has every conference room booked, and every HR person and security staff member is at work. There are cuts in all departments, according to one of our sources, who says some of these have already been downsized and are now being told to cut 15 per cent more heads.

We hear the worldwide layoff number is now greater than 15,000 people.

Our insider commented: "It’s going to be a bloodbath.”
So what can those on the receiving end of said bloodbath expect? Not much. "The severance package is two months' pay plus an extra week of pay for each year of service, a bonus at 75 per cent, obligated COBRA health insurance for 18 months in the United States, and outplacement services (in the US at least)."
The internal justification for th move:
... Dell has started its Stateside layoffs this week. Internal company emails seen by The Reg mention “simplifying client support structure - both basic and up sell,” “client support structure combined - Consumer and Commercial come under one umbrella,” and “Up sell offers will align with Pro Support and will "evolve”. The “evolve” word could mean that further changes are coming.
Also known as trying to remain cash flow positive in a world that has long since moved on and left Dell in the dust....
We wish the company's billionaire founder well as he progresses with the bloodbathing, just as we wish the BLS the best of luck in the coming weeks as they use every seasonal adjustment gimmick known under the sun to make the 15,000 mass termination disappear. Wait, we know: it's all the weather's fault. And demographcs.

Further cuts are coming to Disney’s Interactive group, with several hundred people expected to be laid off as early as this week.
The staff reductions are expected to come mostly from Disney’s Playdom, which produces games for social-media platforms, sources confirm to VarietyDisney Interactive also runs and produces mobile games, including the franchises “Where’s My Water?” and, more recently, “Where’s My Mickey?”
Disney purchased Playdom in 2010 for $563 million, but the company has struggled in its efforts to release a string of successful franchises since then, although “Marvel: Avengers Alliance” has performed well.
Instead, Disney has scored with new properties like “Disney Infinity,” essentially its version of Activision’s “Skylanders,” which combines the use of physical figures and videogames. “Disney Infinity” has sold more than 3 million copies since it debuted in August.

Novartis to cut or transfer up to 4,000 pharma jobs: paper

ZURICH Sun Feb 2, 2014 12:02pm EST
The logo of Swiss drugmaker Novartis is seen at its headquarters in Basel October 22, 2013. REUTERS/Arnd Wiegmann
The logo of Swiss drugmaker Novartis is seen at its headquarters in Basel October 22, 2013.
(Reuters) - Swiss drugs group Novartis (NOVN.VX) intends to cut or transfer up to 4,000 jobs, newspaper NZZ am Sonntag reported on Sunday, citing an internal email.
The plan affecting up to 6 percent of its pharmaceuticals workforce comes on top of a program to reduce the number of production sites and is part of a larger drive to cut costs, the newspaper said.
Global drugmakers are under increasing pressure from investors to step up restructuring as patents on best-selling drugs expire and governments try to keep a lid on health costs.
Company spokesman Eric Althoff did not confirm the job numbers but issued a statement saying that Novartis intends to prioritize and reallocate resources primarily in pharmaceutical operations to focus on planned product launches and other growth areas.
The measures "reflect the need to respond to a dynamically changing healthcare environment", it said, adding that Novartis expects group headcount to remain largely flat in 2014.
"We expect that an equal number of jobs will be created as are reduced," the statement said.
A significant number of jobs are expected to be moved to India, with the company saying that it plans to move existing operations in Hyderabad to a business services center as part of its consolidation strategy.
"The new center is expected to open in late 2015 or early 2016 and will bring together Novartis operations that are currently spread across three sites in Hyderabad as well as provide for future growth," the statement said.
Novartis, which will face copycat competition for blood pressure pill Diovan once Ranbaxy Laboratories (RANB.NS) overcomes regulatory delays for its generic version, posted lower than expected core earnings per share last week.
The company is also conducting a review of its over-the-counter, animal health and vaccines businesses, which lack the global scale of its pharmaceuticals operations.

United To Dump Cleveland Hub, Cut 470 Jobs

United Airlines said Saturday it will drop its money-losing hub in Cleveland, slashing its daily flights and eliminating 470 jobs.
The company's CEO Jeff Smisek announced in a letter to employees that the airline will no longer use Cleveland to connect fliers coming from other airports around the country. As a result, United's daily departures from the city will fall from 199 currently to 72 by June.
"Our hub in Cleveland hasn't been profitable for over a decade, and has generated tens of millions of dollars of annual losses in recent years," Smisek states. "We simply cannot continue to bear these losses."
United said in November that it aims to cut $2 billion in annual costs in the coming year by shifting flights, making workers more productive, and improving its maintenance procedures.
Similar cutbacks have affected many other small hubs in cities such as Memphis, Cincinnati and Salt Lake City amid a wave of airline mergers over the last five years.
Because it's hard to fill a plane between, say, Indianapolis and Paris, airlines use hubs like Cleveland to gather passengers and connect them to the flights they want. People who live in a hub city get a wider selection of destinations because their airport has more flights than it would if it was limited to the flights supported by local traffic.
Cleveland was a hub for Continental when it merged with United in 2010 to form United Continental Holdings Inc. Ever since the merger, people in the industry have assumed it was in danger of losing its hub status, because the airline now has United's Midwestern hub in Chicago.
"Ever since the merger everyone knew this was a risk, which is why economic development officials for the city, the region and the state have discussed options with United for keeping its presence in Cleveland," Ohio Gov. John Kasich said. "This is a disappointing decision and one we disagree with, but a point that United stressed is that demand for air travel from Cleveland remains strong and that they're maintaining virtually all of their flights to and from major markets."
In June, Delta Air Lines Inc. announced it would be closing its Memphis hub, which it had inherited in its 2008 acquisition of Northwest Airlines. Delta already has a huge hub operation in Atlanta.

Yankee One Dollar going the way of penny candy

January 31, 2014 1:55 pm  •  

A combination of damaging legislation, competition from national chains and an increasing cost of doing business has priced out one of the last regionally owned dollar store chains.
Yankee One Dollar Stores Inc. President Keith Flike said his company, based in Waterford, had been thriving for 25 years, hitting its peak about five years ago with 39 stores in New York, Vermont and Massachusetts, providing jobs for about 300 people.
The chain has three local locations in Queensbury, Granville and Greenwich.
“I’m the only retailer in 25 years that hasn’t raised their prices,” said Flike, who founded the company a quarter-century ago when he saw an opportunity.
“We were one of the few regional players left in the industry,” Flike said.
But now the chain is down to 25 stores, all of which will be closed in 90 to 150 days, putting 150 people out of work.
Each store has 6 to 10 employees.
“It’s just getting harder and harder to put goods in the stores that we can find to sell for a dollar that the customers are going to like,” Flike said. “Everything else has gone up, too — minimum wage, insurance and rent.”
He said the Affordable Care Act and the state’s increase of the minimum wage to $8 an hour played a part in the decision.
“They all played parts,” along with the rising cost of fuel and competition from national chains, he said.
Talks began in June of last year, and after this holiday season the final decision was made to shutter the chain.
“It’s very hard to compete with people who have 10,000 stores or 6,000 stores. They have tremendous buying power,” Flike said.
Flike, 60, said he will retire, and the company will continue to lease its 105,000-square-foot distribution center and lease a few properties it owns. Most of the stores, including the local locations, are leased.
Until the stores close, everything is discounted to 75 cents.
“We really hope our customers take advantage of our sale. It’s kind of fun going in — I really always related to my customers. I’m going into stores seeing customers go up to the store manager saying, ‘We’re really going to miss you guys. We’ve been shopping here for 20 years.’ That’s kind of cool,” Flike said.
He said many of his employees had been with the company for more than a decade.
“A lot of employees had been with me a long time, and some in places where it’s going to be hard for them to find jobs,” Flike said. “We probably stayed in the industry two years longer than we should have, trying to hold on for our employees and customers.”
The chain bought most of its products through liquidations.
Whatever is left over in the stores, including fixtures, will be sold to liquidators.
“We’ve got to take whatever is remaining out of our stores. That’s quite a process also,” Flike said.