Industrial adhesives manufacturer H.B. Fuller will eliminate about 220 jobs as part of a $17 million to $20 million restructuring.
The company said Friday about 40 of the jobs will be cut from local administrative and management ranks.
The restructuring is part of the company’s 2020 strategic plan. The company said the layoffs and other initiatives being taken are “to optimize its operations, product lines and business portfolios.”
The rest of the layoffs will be across various businesses and functions at the company. Local employees have been informed of the moves.
The company expects the restructuring plan will produce about $18 million in annual savings.
“Over the past five years, we have transformed our market focus, innovation portfolio and manufacturing capabilities to deliver value for customers, shareholders and employees,” Jim Owens, Fuller’s president and CEO, said in a statement. “As we continue to shift our product portfolio to a richer mix of higher growth, higher profitability adhesive market segments, we need to ensure our resources align with our vision. The proactive changes we are announcing will allow us to invest in the highest opportunity areas within our portfolio and become more agile as we support our customers’ success and deliver our 2020 plan.”
Fuller has about 4,000 employees, and a company spokesperson said that over the past four years the company had added nearly 200 jobs locally.
The $17 million to $20 million in restructuring charges will be taken in fiscal 2017. According to a filing with the Securities and Exchange Commission, about $13 million of the restructuring costs will be for severance and related employee costs.
Another $4 million to $7 million will come from optimizing facilities and production processes.
“These changes support our plan to deliver 10 percent adjusted [earnings per share] growth in 2017 vs. 2016 on a comparable 52-week basis,” Owens said. “Our fourth-quarter numbers are not yet finalized, but we expect results in line with previous guidance.”
Vadnais Heights-based Fuller’s fiscal year ended Dec. 3.
The company will announce its annual results and more details about its financial plans during its regularly scheduled earnings conference call in early January.
In the company’s fiscal year ended Nov. 28, 2015, it reported annual revenue of $2.1 billion and adjusted earnings of $88.4 million, or $1.71 per share.
Analysts expect Fuller’s 2016 annual revenue to be flat to down less than 1 percent and to report and earnings per share of $2.48.