Satcon Technology Corp cuts 140 jobs

Satcon Technology Corp., a Hub-based company that specializes in designing and selling efficient energy systems, announced its 140 layoffs will include 10 Bay State workers, reducing its local headcount to about 156.

“Our commitment to achieving profitability, combined with the dynamic (photovoltaic) environment of 2011, have led us to adjust our cost structure to ensure that we are able to successfully deliver the industry’s most advanced and cost-effective solutions profitably,” said Satcon’s Chief Financial Officer Aaron Gomolak in a statement. “These spending reductions, coupled with our accelerated cost reduction programs, significantly lower our break-even level during the first half of 2012.”

The company also announced plans to close its Canadian manufacturing facility, which coupled with the layoffs, would result in charges of nearly $2.8 million to $3 million. Company officials said Satcon has also restructured its office and warehouse infrastructure in Europe, China and the United States in order to better align with market conditions and reduce costs further.

The majority of the charges are expected to occur in the fourth quarter of 2011, with the rest taking place in the first quarter of 2012, the company said, adding it expects to accumulate ongoing savings of upwards of $17 million annually once all actions are implemented by the second quarter of 2012.

Satcon is also analyzing its inventory and certain non-cancelable supplier-held inventory and will write down the value or take a charge to reflect current market conditions, which would result in expected charges during the fourth quarter of 2011 of nearly $20 million to $26 million, with the majority of the charges comprised of non-cash items, the company said.

“The worldwide solar market conditions in 2011 demonstrated the dynamic nature of this maturing industry,” Satcon’s President and CEO Steve Rhoades said in a statement. “The compounding effects of reduced panel costs and market demand shifts toward North America and Asia have forced the entire industry to adjust as we enter the next phase of development.

Decreasing prices, however, present significant opportunity for Satcon, where the demand for our large-scale inverter solutions nearly doubled in North America and Asia year-over-year. The measures we have announced today will help to ensure that Satcon achieves the financial strength required to profitably maintain our leadership position as the standard for large scale inverter systems as solar power generation becomes a more affordable and stronger investment worldwide.”

Source: Boston Herald