VANCOUVER — Wire maker Tree Island Wire Income Fund is cutting 10 percent of its salaried staff in a cost reduction effort linked to the consolidation of U.S. operations.
The move brings to 22 percent the overall reduction in the company's U.S. work force and six percent of its Canadian workforce since July, the Vancouver-based company said Friday.
The firm didn't announce exact job-cut numbers, but it had about 630 employees at the end of 2006.
''These actions, while difficult, are essential to realizing the full synergies from our Baoan acquisition and our efforts to control overhead costs,'' CEO Daniel McAtee said in a release.
''While we have achieved solid top-line growth as a result of our strategic initiatives, extremely challenging market conditions demand prudent cost control measures. We will continue to monitor our costs closely.''
The staff cuts, along with the previously announced closure of Tree Island's Covina office and Ferndale and Corona factories in the United States, are expected to generate savings of about $2.5 million annually.
The fund said it expects one-time cash costs of about $1.2 million, some of which will reduce distributable cash and net income in 2007 and some of which will be allocated to the purchase of Baoan.
With headquarters in Richmond, B.C., Tree Island Industries makes wire products for construction, agricultural, manufacturing and industrial use. Its products include bright wire, stainless steel wire and galvanized wire; an array of fasteners, including packaged, collated and bulk nails; stucco reinforcing products, engineered structural mesh, fencing and other wire products.
The company sells its products under the Tree Island, K-Lath, Halsteel, Tree Island Wire, Industrial Alloys and USA-Wire brand names. Tree Island also owns and operates a Hong Kong-based trading company.