Targeted layoffs part of restructuring plan for Memphis-based Medtronic Spine
[Commercial Appeal (Memphis, TN)]
April 18--Memphis medical device maker Medtronic Spine will trim its global workforce as part of a restrucuring plan to cut costs about 5 percent.
Medtronic Spine, with about 1,500 employees in Memphis and 5,600 worldwide, said details on its targeted layoffs will emerge later this spring as the company determines elements of the restructuring plan. It was not clear on Wednesday how many positions might be let go in Memphis.
"The specific details are still being determined and won't be available until May," Eric Epperson, senior director of public relations and communications, said in a statement.
"However, our goal is to reduce our overall costs by approximately 5 percent through a number of actions including employee reductions," Epperson said.
Medtronic Spine, described as the global leader in spinal treatments including implants, instruments and biologics, is based in Memphis. It is a division of Medtronic Inc., a medical technology company based in Minneapolis that employs 45,000 worldwide.
The Memphis division is trying to reduce the number of jobs lost. Trimming the amount available for pay increases is another element of the restructuring plan that could minimize the impact on people, Epperson said.
Medtronic Spine on April 4 informed employees about the coming restructuring "which will include a number of actions including targeted employee reductions at certain business functions and locations," Epperson said.
"The restructuring is intended to set a foundation for the business to return to growth and consistently achieve our financial goals," Epperson said in the statement. "We are addressing the near-term cost and pricing challenges facing our business, while also responding to the long-term dynamics of the global health care environment and changing needs of our stakeholders."
In the quarter ended Jan. 25, Medtronic Spine's revenue slipped 4 percent -- 3 percent if currency fluctuations are factored out -- to $753 million. The lower revenue was primarily driven by drops in bone morphogenetic protein, a protein that stimulates bone growth, and balloon kyphoplasty, a procedure used to treat compression fractures of the spine, the company reported.
Net sales in spinal products for Medtronic have dropped over its last two fiscal years.