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ITT announces plans to lay off 270 employees amid low oil prices

Published 06/24/2016, 08:07 PM
Updated 06/24/2016, 08:10 PM
ITT Corp., a White Plains, NY technology solutions company, expects to lay off 270 workers by year's end

ITT Corp., a White Plains, NY technology solutions company, expects to lay off 270 workers by year's end

Investing.com -- ITT Corporation (NYSE:ITT) said on Friday afternoon that it expects to lay off roughly 270 employees in the coming months in response to persistently weak energy prices.

In an 8-K filing with the U.S. Securities and Exchange Commission (SEC), the company said it has finalized several restructuring actions in order to reduce the overall cost structure of the business, stemming from the "negative impact of weak oil and gas prices" on expenditures for its customers. As a result, ITT expects to incur pre-tax cash costs of $12 to $13 million primarily in severance payments, relating to the restructuring plan. On a long-term basis, ITT anticipates to realize annual pre-tax cash savings of roughly $19 million from the initiative.

Last month, ITT said adjusted organic revenue fell by 2.5% over the first quarter, while its adjusted segment operating income dropped by 10% over the prior 12 months, due in part to the negative impacts from unfavorable foreign exchange translation.

On a GAAP basis, however, the White Plains, New York-based technology solutions company saw its revenue increase 3.5% to $609 million. In addition, ITT reported flat EPS of 0.42, reflecting the impact of the company's acquisition of Wolverine Advanced Materials and Hartzell Aerospace.

"In the first quarter, ITT continued to confront a challenging macroeconomic environment that presented headwinds across a number of areas, including foreign exchange and the oil and gas and mining markets. For ITT, we realized the benefits of our balanced and diverse portfolio as the market headwinds we faced were offset by solid revenue growth in key global transportation markets. We also continued to drive an intense focus on corporate cost containment," ITT CEO Denise Ramos said at the time. ITT expects to complete the restructuring plan before the end of the year.

Shares in ITT inched down 0.01 or 0.03% to 32.84 in after-hours. ITT closed the regular session at 32.84, down 3.51 or 9.65%.

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