Gibraltar Industries plans to close five facilities and eliminate 250 jobs as the Hamburg-based manufacturer drops its Alabama-based bar grating product line and stops selling residential solar racking systems in Europe.
The job cuts, expected to take place within the next four months, are part of Gibraltar's efforts to put more of its capital into its most profitable and fastest-growing product lines, while eliminating or scaling back its investments in its weakest units.
"Negative market dynamics continue to hinder the profitability of both product lines for the foreseeable future," said Frank Heard, Gibraltar's CEO, in a statement.
"We made the decision to exit these product lines after assessing their prospects for future growth," he said.
The shutdown of its Birmingham, Ala.-based Amico bar grating business, which is marking its 75th anniversary this year and also has a facility in Hamilton, Ont., and its European solar racking unit are expected to reduce Gibraltar's annual sales by about $75 million. But because those businesses are losing money, the shutdown also is expected to increase the company's operating profits by about $6 million a year, or 12 cents per share.
The closings will result in Gibraltar taking a one-time charge of about $27 million against its earnings during the current quarter and the first quarter of next year. The charge, mainly from a write-down in the value of the assets of those businesses, are expected to reduce earnings by 21 cents per share in the fourth quarter and by 6 cents per share in the first quarter.