A medical products company with a facility in Camden is moving some of its Maine operations to Minnesota and laying off 35 people companywide, with some staff cuts in Maine, the corporation announced Thursday.
IntriCon Corp., based in Arden Hills, Minn., makes wireless monitoring devices for medical products, hearing aids and government agencies.
The company’s medical coil business will be transferred from IntriCon’s Maine facility to Minnesota “to better leverage existing manufacturing capacity, and exploring alternatives for the remaining security and microphone business, including possible sale,” the company stated in a press release.
“The majority of the staff reductions are immediate, except in the company’s Maine operation, where there will be a phased approach. Impacted employees will receive financial support and outplacement assistance,” the release stated.
“Additionally, IntriCon will classify its Maine operations, which include the company’s security, microphone and receivers businesses, as discontinued operations for financial reporting purposes.”
The company said it hopes to reduce costs by $3 million a year. In addition to shifting work away from the Maine facility, other work will be transferred from Singapore to Indonesia. The restructuring is expected to result in charges of $200,000 to $250,000 for the rest of the fiscal year.
Scott Longval, the chief financial officer, said in an interview that the company has about 215 employees in the Twin Cities. Roughly a third of the layoffs would be in the Twin Cities operations, he said.
IntriCon makes a wireless glucose monitor for Medtronic, which is IntriCon’s largest customer and accounts for about 25 percent of its revenue, Longval said. IntriCon also manufactures a hearing aid for UnitedHealthcare. IntriCon was founded in 1977, and went public in 1993.
“As a company, we needed to better align our cost structure with current lower revenue levels — a trend that is continuing in the second quarter,” Mark Gorder, president and chief executive of IntriCon, said in a statement.
“These initiatives allow us to consolidate operations, reduce our global manufacturing footprint, lower our costs and provide greater focus on our strategic plan: growing the value hearing health and medical biotelemetry opportunities that hold the greatest potential to drive shareholder value.
“Change of this nature is hard, but necessary,” Gorder said. “By right-sizing our organization, and better leveraging our existing resources, we’ll be able to aggressively drive our two largest growth opportunities — which we expect will strengthen in the second half of the year.”
Last year the company earned $709,000 on revenue of $63.9 million.
IntriCon’s revenue peaked in 2007 at $69 million. The recession took a big bite out of sales, which declined to a low of $51.7 million in 2009. Revenue has yet to recover to its prerecession peak. IntriCon’s workforce also peaked in 2007 at 612 employees.
IntriCon shares closed Thursday at $3.39, up a penny.
© 2013 the Star Tribune (Minneapolis)
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