ICN Biomedicals Will Undergo Restructuring
ICN Biomedicals Inc., which employs 276 people in Costa Mesa and Irvine, announced Friday that it intends to broadly restructure its business.
The company said layoffs are likely, but it has not decided yet which jobs to eliminate. It said the move is an attempt to refocus its business strategies and become more competitive.
ICN Biomedicals, a subsidiary of ICN Pharmaceuticals in Costa Mesa, said it will consolidate or close some plants and withdraw from unprofitable or marginally profitable businesses.
Details of the restructuring are expected to be announced next week, along with financial results for the fourth quarter and fiscal year. The company expects to report a substantial loss for both the fourth quarter and year because of a “significant” one-time restructuring charge.
The company reported third-quarter earnings of $840,000 on sales of $21.2 million.
ICN Biomedicals also announced a 13% increase in its quarterly cash dividend, to 4.25 cents per share, from 3.75 cents.
“The reason we increased our dividend is because management expects to get improved results based on our ongoing restructuring,” said Paul Knopick, a company spokesman.
The company supplies the biotechnology industry with chemicals, test kits and laboratory equipment used to research aging and cures for diseases such as cancer.
David Anast, publisher of the Biomedical Market Newsletter in Costa Mesa, took a positive view of the restructuring plan.
“This is one of the most dynamic and innovative areas in the medical field today,” he said. “It looks like (ICN Biomedicals) is clearing the decks for competition on a higher plane. They are to be congratulated for acting firmly and decisively.”
Knopick said the company has cut its work force in half at a plant in Italy, to 50 people. It has also consolidated several European accounting offices into one location in Scotland, eliminating another 15 to 20 jobs.
ICN Biomedicals stock closed Friday at $6.25 on the American Stock Exchange, down 12.5 cents a share. The company announced its restructuring plan after the market closed.
