Carclo plc, an injection molder of telecommunications connectors, plunged into the red to the tune of almost £19 million ($28 million) in 2001 in the wake of the global telecommunications slowdown.
In a bid to stabilize the situation, the Wakefield, England-based company has announced it will close two plants in Scotland, trimming 200 jobs.
Meanwhile, the company is continuing its redeployment and expansion efforts in lower-cost regions. In Eastern Europe Carclo is preparing to duplicate its successful first injection molding plant in Brno, Czech Republic.
Back in Britain, in what the group calls a ``painful process,'' Carclo Technical Plastics, the group's plastics processing division, has reorganized its mold-making and connector production units in England. The measures cost Carclo £21 million ($31 million), the company announced.
Cost cutting has affected the company from top to bottom, with the sudden June demotion of Tez Kurwie, the executive director responsible for reorganizing the technical plastics business. There was a need to ``reduce central costs,'' Carclo said in a news release. Kurwie, who took the job in February 2000, will stay on as head of the firm's new precision tooling division.
``We're a smaller company than we were a year ago, so there is a need to reduce the number on the board to reflect that,'' said Carclo Chief Executive Officer Ian Williamson.
``Tez likes Carclo and CTP, and so he will stay on in an operating role,'' he added.
Carclo's U.S. operation, CTP Carrera, has molding plants in Wilmington, N.C.; Tucson, Ariz.; and Latrobe, Pa.
In other plastics operations, Carclo has continued expanding capacity in low-cost regions, with new molding plants in Brno and Shanghai, China. The Shanghai plant already operates six injection presses with 55-110 tons of clamping force. With demand growing from multinational customers, Carclo expects to add five more presses, probably of 110-180 tons, from the United Kingdom.
For the year ended March 31, Carclo reported a pretax loss of £18.5 million ($27 million) against a profit the previous year of £8.6 million ($13 million). Sales were down by 3 percent at just more than £126 million ($185 million).