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UPDATE 1-AMSC slashes 25 pct of workforce, cuts 3rd-qtr outlook
November 28, 2012 / 2:50 PM / 5 years ago

UPDATE 1-AMSC slashes 25 pct of workforce, cuts 3rd-qtr outlook

* Expects third-quarter adj loss of less than $0.31/share

* It had earlier forecast adj loss of less than $0.26/share

* Shares fall 11 pct in early trading

Nov 28 (Reuters) - Power technology company AMSC said it laid off about a quarter of its workforce due to “challenging conditions” in the wind power market.

The company also cut its loss outlook for the current quarter ending December to less than 31 cents per share, excluding items. It had earlier forecast a loss of less than 26 cents.

The maker of electrical components for wind turbines said it has about 340 employees after the workforce reduction.

AMSC has been struggling to return to a profit after losing major customer Sinovel Wind Group in 2011, but a weak global economy and industry overcapacity have kept progress at bay.

Devens, Massachusetts-based AMSC’s shares fell 11 percent to $2.47 in early trading on the Nasdaq. They have lost more than 80 percent of their value since Chinese wind turbine maker Sinovel refused to accept shipments in April 2011.

AMSC’s revenue from the wind turbine business fell more than 10 percent in the quarter ended September.

“Financing and cash flow among wind farm developers and wind turbine manufacturers have been constrained, which has impacted growth plans for some of our partners,” Chief Executive Daniel McGahn said in a statement.

AMSC said it expects to incur restructuring charges of between $3 million and $4 million related to the job cuts over the next two quarters, $2 million of which will be taken in the current quarter.

The company also expects savings of about $10 million from the restructuring, fully realized in the quarter ending June 2013.

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