NORDIC BUSINESS REPORT-January 17, 2019-Net Insight announces cost reduction measures and steps to strengthen profitability
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Net Insight AB (STO:NETIB) announced on Wednesday that it plans to reduce costs and make minor organisational changes.
Reportedly, these measures are a natural consequence of the reorganisation that was made in October 2018 and the aim is to improve results, increase efficiency and create room for continued investments. Under these measures, the costs are expected to decrease by approximately SEK25m annually and also means certain changes in executive management.
Also, operating profit for the fourth quarter will be charged with approximately SEK43m for provisions and write-downs, primarily relating to the write-down of development costs of SEK36m, as well as inventory revaluation and structural costs for personnel reductions.
Preliminary sales and operating profit for the fourth quarter, including the above-mentioned costs, are estimated at SEK106m and a negative SEK58m, respectively. Costs for staff reductions are expected to affect operating profit for the first quarter of 2019 by SEK3m to SEK5m.
Under the organisational changes, in order to improve profitability, increase efficiency and create room for continued investments, the joint sales organisation is right sized and transferred to the various product units, which further increases the customer focus.