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January 14, 2002
SALT LAKE CITY--In an effort to focus oncore businesses and to improve net losses, Weider Nutrition International Inc. (NASDAQ:WNI)in late December reduced its workforce, eliminated various departments andrestructured itself into three business units. According to the company (www.weider.com),these moves should translate into approximately $3 million in annual savings.
The 25 positions that were eliminated include those from the now defunctcentral sales, marketing and research & development (R&D) departments,as well as three top-level executives: the senior vice president (VP) of humanresources, the senior VP of technology and the executive VP of sales andmarketing. As of June, when the company laid off 20 employees, Weider had morethan 800 employees on staff.
The Schiff Specialty Nutrition Unit, which includes the Schiff and Move Freebrands, represents the most significant strategic asset within the company;Bruce Wood, chief executive officer and president of Weider, will lead thatunit. Rick Blair, former VP of sales, will supervise the Active Nutrition Unit,which contains the American Body Building, Tigers Milk and Weider brandedglobal businesses. Finally, Bruno Iverson will oversee Weiders primaryEuropean subsidiary, Haleko; Iversen recently joined Weider from German-basedSchuemann Sasol AG. The three units will be managed independently, each with itsown R&D personnel, sales and marketing teams, operations management,technical support and administrative staff.
Within the competitive arena that were continuing to operate in, weretaking a proactive step to address what we see as both a continuing competitiveand economic challenge for this industry, Joe Baty, chief financial officerand executive vice president at Weider, told INSIDER. Headded that even though these changes took place, overall, he does not believethe sports supplement segment has been more negatively impacted by the softnessof the natural products industry as a whole.
For the second quarter (2Q02) ended Nov. 30, the company had $77.9 million insales, which was flat with what was made in the comparable period last year.However, net loss increased 14-fold, to $3.9 million from $.3 million lost in2Q01. The company stated that its overall performance was negatively impacted bycontinued operating losses in its Venice Beach sports apparel business.
With these recent measures, we are taking another positive step forward inwhat we anticipate to be continued difficult market conditions, Wood said ina company statement. We will continue to scrutinize spending, analyze oursupply chain processes and evaluate our dividend policy against re-investmentalternatives.
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