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Graham Corp. plans 10% cut in workforce

Coming off a strong fiscal year and after reviewing its outlook, Graham Corp. plans to reduce its global workforce by 10 percent.

The Batavia-based manufacturer of vacuum and heat-transfer equipment recorded profits of $4.2 million in its fourth quarter, which ended March 31. That was up by 80 percent from a year ago.

For all of fiscal 2015, Graham recorded net income of $14.7 million, up by 45 percent from $10.1 million the year before.

Graham’s full-year sales hit an all-time high of $135.2 million, up by 32 percent from fiscal 2014.

Meanwhile, the company is in the midst of a retirement incentive program. Some of the employees who accepted the offer will stay with Graham until the middle of summer, said Jeffrey F. Glajch, vice president of finance and chief financial officer.

Graham currently has 385 employees, including 318 in Western New York, he said. When the retirement program is finished, the company will have about 370 employees, including about 300 in Western New York.

Why is Graham shrinking its workforce after a strong year?

Glajch said Graham’s outlook for its 2016 fiscal year, which began April 1, is “meaningfully lower” than the past fiscal year.

Lower oil prices affected Graham’s orders in the refining and petrochemical markets in the second half of the past fiscal year, Glajch said.

“We felt a voluntary retirement offer was better for our employees than some type of involuntary approach,” Glajch said.

“It was quite well-received by our employees who, while recognizing our cost challenges ahead, viewed it as the best option available.”

In the fourth quarter, Graham incurred a $1.7 million restructuring charge for severance costs related to the program.

The company’s stock fell by 46 cents, or 2.07 percent, to close at $21.77 on Monday.