Rakon downsizes Auckland manufacturing

By AARON LIM - BusinessDay.co.nz | Friday, 21 November 2008

Technology company Rakon says approximately 45 staff from its Auckland manufacturing operation will be affected by the company's move to "streamline" operations amid tough times.

Managing director Brent Robinson said the consultation process with affected staff, largely from the company's manufacturing operations, as well as support and administration personnel, was near the final stages.

"We announced last week we have been working through an on-going review across our operations to ensure we continue to align costs with business demand, particularly during the current economic downturn,"  Robinson said.

Robinson said the affected staff worked largely in operations which primarily supplied the softening consumer product markets.

"We are making these staff reductions now to ensure Rakon is in a strong position to be able to capitalise on both near term and future growth opportunities," he said.

"However, our engineering and R&D teams, which provide the product and process innovations that drive our business, remain at full strength."

Shares in the company plunged since the company posted a slump in its half year profit recently.

Rakon blamed the weakening global economy for a 66 per cent slump in after-tax earnings to $1.98 million for the half-year to September.

The result was achieved on revenues of $79.37 million - down 12 per cent.

Earnings before interest, tax, depreciation and amortisation (ebitda) were down 16 per cent at $10.4 million.