Entegris will close its manufacturing facility in Upland, Calif. and shift production to Chaska, Minn., at one of its worldwide Centers of Excellence. This realignment, along with other cost-saving measures, includes the elimination of approximately seven percent or 121 positions of the companys workforce worldwide, which encompasses all terminations since the beginning of its fiscal year, Sept. 1, 2002.
Any decisions directly affecting our employees are always made with a great deal of care, said Jim Dauwalter, Entegris president and chief executive officer. Though these are always difficult moves, we have the responsibility to serve our markets in the most efficient means possible which today consists of removing excess costs and capacity. Over the last two years, we have increased efficiencies in our manufacturing operations and strengthened our global Centers of Excellence, streamlining the production of our materials integrity management products. These efforts have allowed us to respond faster and smarter to our customers, ensuring the highest level of service, while reducing the level of resources required. The steps we are taking today help position us for the future as we strive to become a $700 million company by 2007.
The employees affected by the workforce reduction will receive severance packages as well as other assistance. Entegris expects to report a restructuring charge estimated at up to $1.5 million in its first quarter 2003, ending Nov. 30, 2002, related to the realignment of the facility and workforce reduction.
One of Entegris five-year goals is to continue to make our operations a competitive weapon, said Michael Wright, Entegris chief operating officer. The plant relocation and adjustments to staffing are part of an ongoing effort that will help us achieve that goal, creating operational efficiencies going forward and reducing SG&A expenses worldwide. In addition, we have eliminated the majority of temporary positions and cut back on operating hours, including limited operations over the holidays. The long term goal of all these actions will be to better serve our customers today and tomorrow.
Entegris has leased the 22,000 square foot, Upland facility since purchasing an Osmonics product line in October 1999. The facility is responsible for manufacturing machined fluid handling products for the semiconductor industry. Entegris will begin to transition the facilitys operations to one of its Chaska facilities in December 2002. The transition is expected to be complete by February 2003.
The company reiterated its guidance for first quarter 2003, ending Nov. 30, 2002, of sales in the low $50 million range and that it will continue to monitor the carrying value of its investment in Metron Technology N.V., a distributor of Entegris fluid handling products.