Zurich-based telecommunications equipment manufacturer Ascom Holding AG will cut its workforce by another 1,000 this year, chief executive Leonardo Vannotti said yesterday. Even if such measures are painful and certainly should not be the only way to cut costs, an analysis of the present economic situation in our most important markets leaves no other choice, […]
Zurich-based telecommunications equipment manufacturer Ascom Holding AG will cut its workforce by another 1,000 this year, chief executive Leonardo Vannotti said yesterday. Even if such measures are painful and certainly should not be the only way to cut costs, an analysis of the present economic situation in our most important markets leaves no other choice, he said. The annual report for 1992 showed the workforce was cut to 16,982 at the end of last year from 18,215 a year earlier, Reuter notes. The company said business in the first quarter was not fully satisfactory but it expects results for the full year 1993 to show an improvement over 1992. The company last week reported a surprise $30.9m (CI No 2,158). Vannotti forecast turnover in the company’s most important – home – market, Switzerland, was likely to decline this year, but this should be compensated by expansion of Ascom’s international business. The level of orders received in the first quarter worsened compared with a year earlier, but turnover in the first quarter was up to the high levels of the year-ago quarter. The chastened company admitted that the shock loss showed that it had been guilty of poor financial controls and a badly-timed shareholders letter Vannotti said the board was convinced up to March 22 when the shareholders letter was sent that it would record a profit for 1992, but he and the chairman subsequently ordered a special audit, after financial controllers warned of problems with the accounts for Ascom’s cable television and mobile telephone businesses in Germany, and a closer examination revealed the German results had to be corrected by $41m – $28m of extraordinary depreciation and $12.8m of adjustments to inventory values, Vannotti said. A further $4m correction was needed in accounts relating to the group’s US business – Ascom owns Timeplex. The whole affair has shown deficiencies in our controls, which are now being removed with considerable effort, Vannotti said. Finance director Klaus Ruetschi said financial controls and auditing would be strengthened both at the Swiss headquarters and plants abroad.
