Systems integrator and reseller Inacom Corp said that its fourth-quarter results will be far worse than expected and announced a restructuring that will see at least 1,000 jobs eliminated. The Omaha, Nebraska-based company is projecting a loss for the quarter of between $0.50 to $0.70 per share, before charges, when analysts surveyed by First Call were looking for a loss of just $0.15.
Inacom said the worse-than expected performance was largely due to a Y2K-related lockdown by large corporate clients – the same reason it gave for poor third-quarter results in October. At that time, the company said it expected to post a loss of $0.10 to $0.20 a share in the fourth quarter, when analysts had been expecting a profit of $0.45.
In the wake of its ongoing troubles, the company is set to cut just under 10% of its total workforce of 10,500. The cuts will be made over the first three quarters of fiscal 2000 and will result in a fourth-quarter charge of between $100m and $150m. As part of the restructuring, Inacom will also exit the federal government business. Those moves, together with other cost cutting efforts, are expected to save over $100m annually, the company said.
