Enesco Announces Additional U.S. Corporate Overhead Cost Reduction in Connection with Operating Improvement Plan
November 10 2005 - 4:31PM
Business Wire
Enesco Group, Inc. (NYSE:ENC), a leader in the giftware, and home
and garden decor industries, today announced an additional
corporate downsizing in its U.S. operations as part of the
Company's operating improvement plan. The downsizing primarily
affected the areas of administration, marketing and IT. The Company
anticipates no material charges associated with the workforce
reduction and expects annual pre-tax cost savings from the salary
expense reduction to be approximately $300,000, which is included
in the pre-tax cost savings of $34 million to $38 million in the
U.S. as part of the Company's operational improvement plan. This is
in addition to $670,000 in reductions announced earlier this
quarter, bringing fourth quarter reductions to $970,000 pre-tax
annualized, and full year salary reductions to approximately $5
million pre-tax annualized. "During the process of developing our
operating improvement plan, we evaluated all primary functions
within the Company to determine the right level of staffing to
support the business," said Cynthia Passmore-McLaughlin, president
and CEO. "Including this additional U.S. salary expense reduction,
we expected to generate pre-tax annualized cost savings of
approximately $5 million. We remain committed to improving Enesco's
profitability and having the right infrastructure in place to grow
over time." About Enesco Group, Inc. Enesco Group, Inc. is a world
leader in the giftware, and home and garden decor industries.
Serving more than 30,000 customers globally, Enesco distributes
products to a wide variety of specialty card and gift retailers,
home decor boutiques, as well as mass-market chains and direct mail
retailers. Internationally, Enesco serves markets operating in the
United Kingdom, Canada, Europe, Mexico, Australia and Asia. With
subsidiaries located in Europe and Canada, and a business unit in
Hong Kong, Enesco's international distribution network is a leader
in the industry. The Company's product lines include some of the
world's most recognizable brands, including Border Fine Arts,
Bratz, Circle of Love, Foundations, Halcyon Days, Heartwood Creek,
Jim Shore Designs, Lilliput Lane, Nickelodeon, Pooh & Friends,
Walt Disney Classics Collection, and Walt Disney Company, among
others. Further information is available on the Company's web site
at www.enesco.com. This press release contains forward-looking
statements, which reflect management's current assumptions and
beliefs and are based on information currently available to
management. The Company has tried to identify such forward-looking
statements by use of such words as "expects," "intends,"
"anticipates," "could," "estimates," "plans," and "believes," and
similar expressions, but these words are not the exclusive means of
identifying such statements. Such statements are subject to various
risks, uncertainties and other factors, which could cause actual
results to vary materially from those anticipated, estimated,
expected or projected. Important factors that may cause actual
future events or results to differ materially and adversely from
those described in the forward-looking statements include, but are
not limited to: the Company's success in implementing its
comprehensive plan for operating improvement and achieving its
goals for cost savings and market share increases; the Company's
success in developing new products and consumer reaction to the
Company's new products; the Company's ability to secure, maintain
and renew popular licenses, particularly our Heartwood Creek,
Disney and Cherished Teddies licenses; the Company's ability to
grow revenues in mass and niche market channels; the Company's
ability to comply with covenants contained in its credit facility;
the Company's ability to obtain a new global senior credit
facility; changes in general economic conditions, as well as
specific market conditions; fluctuations in demand for our
products; manufacturing lead times; the timing of orders and
shipments and our ability to predict customer demands; inventory
levels and purchase commitments exceeding requirements based upon
incorrect forecasts; collection of accounts receivable; changes in
the regulations and procedures affecting the importation of goods
into the United States; changes in foreign exchange rates; price
and product competition in the giftware industry; variations in
sales channels, product costs or mix of products sold; and,
possible future terrorist attacks, epidemics, or acts of war. In
addition, the Company operates in a continually changing business
environment and does not intend to update or revise the
forward-looking statements contained herein, which speak only as of
the date hereof. Additional information regarding forward-looking
statement risk factors is contained in the Company's reports and
filings with the Securities and Exchange Commission. In light of
these risks and uncertainties, the forward-looking statements
contained herein may not occur and actual results could differ
materially from those set forth herein. Accordingly, you should not
rely on these forward-looking statements as a prediction of actual
future results.
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