Baltimore Technologies PLC unveiled details of a previously announced restructuring plan on Wednesday, amid mounting financial losses at the Dublin-based security software vendor.
The announcement of the plan's details came as Baltimore officials reported an unaudited second-quarter loss of US$33.3 million before interest, taxes, depreciation, amortization and exceptional items, on revenues of $23.2 million. The company's losses have grown markedly since the same period last year, when officials reported losses of $6.2 million on revenue of $22.9 million.
Describing the company's second-quarter results as "not acceptable," a Baltimore statement laid out plans to lay off 220 workers, reorganize its sales force, delist its Nasdaq-traded stock and spin off the company's content security business.
Baltimore expects the total value of savings generated by its restructuring plans and proceeds from its divestment plans will total $101.3 million over the next year. The company warned at the end of July that restructuring was on the way. [See "Expecting more losses, Baltimore sharpens its axe," July 5.]It plans to make the savings in several ways. By delisting its Nasdaq-traded stock and maintaining only an existing listing on the London Stock Exchange, Baltimore expects to save $2.8 million per year, the statement said.
The restructuring plan also marks the second time in three months that Baltimore has laid off staff in a bid to reduce costs. In May, the company laid off 250 workers, or 18 percent of its workforce. With the most recent round of layoffs and a divestment of its content security business, Baltimore expects to reduce its workforce to a staff of 470 by the second quarter of 2002, down from around 1,100 at present.
Baltimore officials hope that a focus on authentication and authorization technologies, where they feel they have an edge over competitors, will help bring the company back into the black during the second half of 2002. Divesting operations not associated with these technologies, such as Baltimore's content security business, will help to raise funds needed for the company to reach its goal of profitability in the second quarter of 2002, the statement said.