GLV to Cut Jobs

If I said the name GLV would you know what the company did? Would you even be able to venture an educated guess? For many of use GLV is one of those hidden companies. They don’t do a lot of marketing under their direct name and even though you may be using some of their products every day, the odds are good that you would not be able to identify their products on the shelves of your local store.

For those of you who are not familiar with GLV here is a look at how the company has chosen to describe itself, “GLV Inc. is a leading global provider of technological solutions used in water treatment as well as in pulp and paper production. The Corporation operates in some 30 countries and has approximately 2,300 employees (as at December 31, 2010)…. In addition to these groups, the Company has a Manufacturing division that specializes in producing large custom-made parts from the specifications provided by the Pulp and Paper Group or external customers, mostly from the pulp and paper and energy sectors.”

Now that you know what the company does, we can talk about the jobs that they are cutting. After some disappointing fiscal news in the last quarter the company has decided to right itself by cutting back on workers, instead of exploring other options designed to make the company more efficient and less costly to run.

In a statement put out by the company they discussed their plans to cut about one-tenth of their staff in order to save several million dollars a quarter in the future.  Here is an excerpt from that statement, “This repositioning will reduce the workforce by approximately 10% for all of the group’s subsidiaries, generating annual savings of about $8 million. Related restructuring costs, mainly comprising severance payments, are estimated at approximately $4 million and will be recognized in the coming quarters of the current fiscal year.” Given that the company currently employs about 2,200 people this will mean a loss of about 220 workers when all is said and done.  No doubt that those kinds of cuts will be felt by the workers of the company, who will be forced to take on the extra work that would have been done by their exiting compatriots.

Some of you may be wondering exactly how bad the company’s situation is, to warrant these kids of job cuts. Well according to the report put out by the company the losses appear to be bad, but not devastating,  “Revenues of $147.5 million compared with $150.4 million for the corresponding period of fiscal 2012. EBITDA of $5.0 million compared with $4.0 million year-over-year. Net loss attributable to the shareholders of GLV Inc. of ($5.5 million) or ($0.13) per share, basic and diluted, compared with ($4.1million) or ($0.09), respectively, for the corresponding quarter of the previous fiscal year, owing primarily to a $3.5 million unfavorable foreign exchange effect. Total net debt ratio of 25.5% compared with 19.6% as at March 31, 2012. Working capital ratio of 1.56 compared with 1.57 as at March 31, 2012. Backlog of $343.3 million compared with $354.8 million as at March 31, 2012 with Ovivo up $5.0 million and the Pulp and Paper Group and Other Group down $13.6 million and $2.9 million, respectively “