Imation Will Cut More Jobs After Profit Plunges 92%

Imation Corp. said Wednesday that it will cut more jobs than planned after fierce price competition in computer floppy disks and other products led to a greater-than-expected 92% decline in fourth-quarter profit.

The maker of data storage and imaging products said it will eliminate 1,700 jobs, or 17% of its work force, by year-end, up from an October estimate of 1,000 to 1,500 jobs. It also plans to reorganize its European business, sell its CD-ROM unit and combine plants.

Its shares rose $2.56 to close at $16.13 on the New York Stock Exchange as investors welcomed the deeper cuts, which Imation said will reduce costs by $35 million this year and $90 million next year.

Imation, which was spun off from 3M Co. in 1996, said its profit before charges plunged to $900,000, or 2 cents a diluted share, in the fourth quarter, from $11.4 million, or 28 cents a share, in the year-earlier period.