Swiss equipment provider Meyer Burger has announced it will shut-down its diamond wire production at Diamond Materials Tech Inc. (DMT) in Colorado Springs, Colorado.
As a consequence of this decision, the company will lay-off 72 employees working at the factory. Some unspecified “important technology know-how” will be moved to the company’s technology center in Thun, Switzerland.
The company stressed that this production will be discontinued “for quite some time” and has blamed global pressure on prices and margins for its decision.
Although many measures to restructure the production were taken since 2012, the company said, the unit has not been able to become profitable. Furthermore, Meyer Burger said that its decision to stop this production will not affect its product line of diamond wire based cutting equipment.
Moreover, Meyer Burger stressed that its decision to close the diamond wire production in the U.S. will lower its annualized operating cost base by approximately $10 million and will lead to one-time non-cash related depreciation and impairment of inventory, technology and manufacturing equipment in an amount of about $12 million.
Meyer Burger has also provided preliminary financial results for 2016. The company said its sales grew by 40% to $448 million last year, while new orders increased from $414 million in 2015 to $451 million in 2016. EBITDA also improved year-on-year from a loss of $55 million to a $10 million profit.