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First-quarter sales rise to $700.2 million. Company says it plans to cut costs by another $100 million
By Will Daley
Bloomberg News
Published on Thursday, May 01, 2008
Diebold Inc., whose board last month spurned United Technologies Corp.'s $2.63 billion buyout offer, said first-quarter revenue increased 8.1 percent and that it intends to cut another $100 million in costs.
Sales rose to $700.2 million from $647.7 million a year earlier, the automated teller and voting machine maker said in a statement.
The Green-based company released preliminary financial results as it works to complete delayed filings amid an accounting probe by U.S. regulators.
Diebold reaffirmed its 2008 revenue growth forecast of 6 percent to 8 percent. The company said it will meet its three- year goal of reducing costs by $100 million in 2008 and announced plans to cut costs by another $100 million.
Diebold intends to realize $70 million in that new program in the next 18 to 24 months, helped by its plan announced in February to cut about 5 percent of its work force.
Also, Diebold said it intends to transition ''from a four-plant global Opteva production footprint down to two plants.''
The company said it will provide further details on the ATM plants later. Since 2006, Diebold has closed plants in Cassis, France; Danville, Va.; and Buenos Aires, and opened lower-cost facilities in Eastern Europe.
The Securities and Exchange Commission and the U.S. Justice Department are investigating Diebold's discontinued practice of recognizing some revenue on a ''bill and hold'' basis, where sales are recorded before delivery. The company now records revenue when products are accepted at a customer location.
Diebold last reported earnings about a year ago. The company plans to complete an internal review of its accounting practices by the end of the second quarter. Afterward, Diebold intends to release preliminary results for 2007 and the first and second quarters of 2008. Then it will file a restatement of some financials for 2003 through 2006 and the first quarter of 2007.
On Tuesday, Diebold said it plans to take a $49 million noncash impairment charge related to the value of assets in its Premier Election Solutions Inc. business.
Diebold shares rose 53 cents to $39.20 in New York Stock Exchange composite trading. The stock has declined 18 percent in the past 12 months.
Diebold Inc., whose board last month spurned United Technologies Corp.'s $2.63 billion buyout offer, said first-quarter revenue increased 8.1 percent and that it intends to cut another $100 million in costs.
Get the full article here.
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