Graco Aligns Operations with Market Conditions
March 18 2009 - 5:00PM
Business Wire
Graco Inc. (NYSE: GGG) today announced an additional
workforce reduction as part of its continued efforts to align
operations with current market and economic conditions.
Patrick McHale, Graco�s President and Chief Executive Officer,
said, �The global recession continues to negatively impact our
business. The Company�s first quarter incoming orders to-date are
40 percent below the comparable 2008 period (measured at consistent
exchange rates). As a result, we must take the difficult step of
further reducing our workforce. We sincerely regret the impact this
action has on our employees.�
The workforce reduction will affect approximately 180 people, or
8 percent of Graco�s global employee base. The Company expects to
take a pretax charge of $4 million related to severance in the
first quarter of 2009. The workforce reduction is expected to be
completed in April and is expected to lower the Company�s cost
structure $9 million, annually.
McHale commented further, �We believe our long-term prospect for
growth is strong and that we will be well-positioned to respond to
customer requirements when economic conditions improve. Graco
continues to be committed to making strategic investments in new
product development, distribution expansion, new markets and
strategic acquisitions.�
Graco Inc. supplies technology and expertise for the management
of fluids in both industrial and commercial applications. It
designs, manufactures and markets systems and equipment to move,
measure, control, dispense and spray fluid materials. A recognized
leader in its specialties, Minneapolis-based Graco serves customers
around the world in the manufacturing, processing, automotive,
construction and maintenance industries. For additional information
about Graco Inc., please visit us at www.graco.com.
Cautionary Statement Regarding Forward-Looking
Statements
A forward-looking statement is any statement made in this
earnings release and other reports that the Company files
periodically with the Securities and Exchange Commission, as well
as in press releases, analyst briefings, conference calls and the
Company�s Annual Report to shareholders, which reflects the
Company�s current thinking on market trends and the Company�s
future financial performance at the time they are made. All
forecasts and projections are forward-looking statements. The
Company undertakes no obligation to update these statements in
light of new information or future events.
The Company desires to take advantage of the �safe harbor�
provisions of the Private Securities Litigation Reform Act of 1995
by making cautionary statements concerning any forward-looking
statements made by or on behalf of the Company. The Company cannot
give any assurance that the results forecasted in any
forward-looking statement will actually be achieved. Future results
could differ materially from those expressed, due to the impact of
changes in various factors. These risk factors include, but are not
limited to: economic conditions in the United States and other
major world economies, currency fluctuations, political
instability, changes in laws and regulations, and changes in
product demand. In addition, the Company�s ability to recognize
cost savings from the workforce reduction and respond to economic
conditions as they improve may be impacted by our ability to
execute and maintain the workforce reduction, control other costs,
and manage any disruption to our business from the workforce
reduction. Please refer to Item 1A of, and Exhibit 99 to, the
Company�s Annual Report on Form 10-K for fiscal year 2008 (and most
recent Form 10-Q, if applicable) for a more comprehensive
discussion of these and other risk factors. These reports are
available on the Company�s website at www.graco.com and the
Securities and Exchange Commission�s website at www.sec.gov.
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