Power-One Set To Cut 34 from Camarillo HQ

Power-One, Inc. will lay off 34 employees from its Camarillo headquarters this month as part of a plan to shave $20 million from its budget. The power conversion products developer already let 65 workers go in the spring from a manufacturing facility in Chatsworth that it obtained when it purchased the Magnetek, Inc. power electronics group last year. A company spokesman declined to give specifics on the number of employees and their positions affected by layoffs in Camarillo and Chatsworth so as not to tip off competitors to future plans. Worker Adjustment and Retraining Notification documents filed by the company with the state Employment Development Department show the elimination of engineering, technical, managerial and other administrative positions at the Camarillo headquarters. The closure of the Chatsworth facility resulted in cutting primarily assembly and manufacturing positions. The company transferred work done there to a facility in the Dominican Republic. The Chatsworth firings were completed by mid-March. The state was notified by the company of the Camarillo layoffs four weeks after Power-One CEO Bill Yeates announced a reorganization and restructuring of the business to reduce sales, general and administrative expenses. “Over the course of the next few quarters we expect to realize an SG & A; reduction approximately $20 million annualized,” Yeates said in prepared remarks issued with the company’s first quarter financial statements. A team from the Business and Employee Services Department of the Ventura County Human Services Agency has been in contact with Power-One representatives to offer assistance to the fired workers. No other details were given by Yeates as to how the company would cut costs. For the first quarter ending March 31, Power-One reported a net loss of $12.3 million on revenues of $121 million. That widens the company’s loss when compared with the first quarter of 2006 when it reported a loss of $4.8 million on revenues of $64.6 million. Power-One serves the telecommunications and server/storage markets and data communications equipment manufacturers. Cisco Systems accounted for 12 percent of the company’s sales, making it the largest customer, according to Power-One’s 2006 annual report. Still, the company, which has research and development and manufacturing sites around the world, finds itself in a tough business environment and in competition with Delta Electronics and Emerson Network Power and its Artesyn Technologies subsidiary. A decline in sales volume, product mix and associated manufacturing costs contributed to the net loss in the first quarter, according to the company. “They realized they had to get costs out of the system faster than they anticipated,” said Steven Smigie, an analyst with Raymond James & Associates in St. Petersburg, Fla. “They are doing what they’ve got to do.” The company’s core business in direct current converters shows little growth, Smigie said, adding that focus is now on a new device called the point-of-load converter. Power-One has developed such a device but the market that will buy it is still developing, Smigie said. “Their stuff will catch on eventually but in the short term it is not helpful,” Smigie said. The company has not completely integrated the Magnetek power electronics group into its operations. The group sells power supplies and alternative energy products to a wide range of customers and markets. Magnetek sold the power electronics group in conjunction with the move of its headquarters from the Valley to Wisconsin. As the integration moves forward, the company is optimistic about the opportunities and is intent on aligning costs to position Power-One for sustained profitability, Yeates said in his statement.