40 in O.C. Losing Jobs at Imagyn in Consolidation Move
Medical products maker Imagyn Medical Technologies Inc. said it will close its Laguna Niguel manufacturing facility and move operations to its Costa Mesa plant, dismissing about 40 Orange County workers.
The job cuts are part of a total of 120 layoffs for the Newport Beach company, leaving it with a work force of about 980, said David Pyrce, an Imagyn spokesman.
The company expects to save about $18 million annually from consolidating operations, reducing the staff and taking other cost-cutting measures. The steps are part of the company’s plan to integrate a number of acquired companies and technologies over the past two years and eliminate duplication.
Most of the 40 Orange County employees being dismissed are at the Laguna Niguel operation, Pyrce said. The gynecological manufacturing operation there will be moved to the Costa Mesa plant, where urological products are made.
Remaining dismissals will come from Imagyn’s surgical plant and division in Kalamazoo, Mich., and its urological division offices in Augusta, Ga.
The company said the cutbacks won’t affect distribution or timetables for new products.
Imagyn was formed in September in the merger of Urohealth Systems Inc. in Costa Mesa and Imagyn Medical Inc. in Laguna Niguel. Urohealth, which has been on an acquisition binge, adopted the Imagyn name, deciding it was better for its broadening product line.
Pyrce said Urohealth bought more than two dozen companies, most with few employees but promising technologies, over the past 2 1/2 years. The companies typically have not been generating much revenue, he said, so the costs of developing their products have increased Imagyn’s losses.
But Imagyn executives believe the acquisitions will generate income in the longer term, he said.
Last week, the company said it would post a loss of 60 cents to 65 cents a share--or about $20 million--for its fiscal third quarter, which ended Dec. 31. It expects quarterly revenue of $23 million to $25 million.
That quarterly loss would be more than double the amount Wall Street expected, and the company’s stock tumbled 25% to $2.06 a share. It has sunk further since, closing Wednesday at a 52-week low of $1.88 a share in Nasdaq trading.
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Red Tide
Imagyn Medical Technologies has lost $80 million during the last year, and its stock price has tumbled nearly 75%. The Newport Beach-based medical instruments firm is attempting to stem losses with a consolidation of operations that will eliminate 120 jobs. Imagyn’s sales and net income in millions, and monthly stock closing prices:
Sales: $43.1 (in millions)
Net income: $-14.8 (in millions)
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1997 Stock Trend
Wednesday’s close: $1.88
Source: Bloomberg News
