Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, December 18, 1993 TAG: 9312180069
SECTION: BUSINESS PAGE: A-6 EDITION: METRO
SOURCE: SANDRA BROWN KELLY STAFF WRITER
DATELINE: LENGTH: Medium
And more cuts can be expected, said company spokeswoman Kathy Rogers. Future cuts, she said, will cross all levels, from hourly employees to top management.
Friday's job cuts affected several of the company's Martinsville-area operations, but not the Roanoke Tultex plant, which employs about 200 people. Rogers said the Roanoke plant might be affected later, however.
The manufacturing and distribution facilities in Martinsville employ 2,400 people. Tultex also has Virginia operations in Chilhowie and Bastian. It operates 14 plants and has a total of 6,500 employees.
Workers affected by Friday's action will have the option of taking hourly wage jobs with the company.
Some of the workers losing their jobs were called in from a three-week plant furlough to hear the news. Textile companies traditionally curtail production for about a week near the end of the year to avoid building up excess inventory. But this year, Tultex workers have been furloughed for three weeks.
The job cuts came in the wake of reports by securities analysts who follow the textile industry; they slashed their estimates of Tultex's 1993 earnings by as much as 41 percent.
Analyst Jay Meltzer with Goldman Sachs revised his estimate for Tultex's 1993 earnings from 56 cents per share for the fiscal year that ends Jan. 2 to 33 cents a share. He also revised downward his projection for the company's 1994 earnings.
"We now expect Tultex's final-quarter sales to be flat to down slightly," Meltzer said in the report.
Analysts with Goldman Sachs and J.P. Morgan Securities Inc. say retail and wholesale demand for T-shirts and fleecewear, Tultex's primary products, has declined considerably.
Jack Pickler of Wheat First Securities Inc. in Richmond cut his estimate for the company's fourth-quarter earnings 38 percent, to 25 cents per share, compared to 40 cents last year. He cut his full-year estimate to 40 cents and his 1994 estimate to 65 cents.
J.P. Morgan changed its 1993 earnings estimate from 56 cents per share to 30 cents. It said the cancellation or reduction of activewear orders from retail discounters will affect not only fourth-quarter earnings, but also early 1994 net income for most manufacturers.
The textile company reported third-quarter earnings equal to 21 cents, down from 33 cents in the same period last year.
The Associated Press contributed to this story.
by CNB