May 14, 2002 Plexus Corp. today announced its intent to consolidate its Neenah, Wis. manufacturing operations and to close itsMinneapolis, Minn. new product introduction (NPI) center.
The facilities located at 2121 Harrison Street in Neenah will be closed permanently when Plexus completes the transfer of production to its other domestic sites, which is planned to occur before the end of the calendar year.
These facilities total approximately 84,000 square feet and employ approximately 400 people. As a result of the consolidation, Plexus will be reducing its Neenah workforce by approximately 100 employees starting in mid-July, with the total number dependent upon business conditions going forward.
Plexus will continue to employ over 2,000 people in the Neenah/Appleton area, including its headquarters, engineering center and manufacturing operations in Neenah and its NPI center in Appleton.
In addition, the company announced its plans to permanently close its Minneapolis, Minn. NPI center. The Minneapolis NPI center occupies approximately 19,000 square feet and employs about 100 people. The site is expected to be closed by August, upon the transfer of customers to other Plexus sites.
"The Harrison Street facilities in Neenah are at the end of their life expectancy and the Minneapolis NPI facility is no longer sufficient to service our customers' needs," said Dean Foate, chief operating officer, in a released statement. "We had planned to invest in replacing both of these facilities. However, with the continued weak economy we have excess manufacturing capacity throughout our operations, so investing in new facilities would not be prudent at this time."
The company currently estimates that nonrecurring charges totaling approximately $3 million to $5 million will be taken over the next two to three fiscal quarters associated with the facility closures and workforce reduction. Current estimates for savings associated with the facility closures and workforce reduction are in the range of $1 million to $1.5 million per quarter, once the restructuring is fully completed.
Throughout its 25 global locations, the company will continue to employ more than 6,200 people and will occupy about 1.8 million square feet in total.
Based on current customers' orders and forecasts, the company today also reiterated its fiscal third quarter 2002 guidance, which is for sales to be in the range of $235 million to $245 million, with diluted cash earnings per share to be in the range of 6 to 9 cents.
