ADC Telecom lays off 400

(Telephony) ADC Telecommunications handed out pink slips to 18% of the 2,300 workers in its systems integration unit yesterday as part of an effort to improve the division’s profitability.

The $4 billion network equipment company said the 400 laid-off workers came from various geographies and included employees from the technical and management ranks.

“This division is assessing its profitablility goals and thought this was the best action to meet those stated objectives,” a spokesman said.

During 2000, ADC had boosted the division’s headcount by 800, many as a result of acquisitions. “We added significantly to that group over the last six months to a year,” a spokesman said. The job cuts affected less than 2% of ADC’s total headcount of 22,400.

For ADC’s fiscal fourth quarter ending October 31, 2000, the Integrated Solutions Group, which also includes the software services and enhanced services divisions, recorded sales of $170 million, up 48% over 1999. However, pro forma operating income, before goodwill, was $10 million for the quarter, a 40% decrease compared to 1999’s fourth quarter.