Micronic Losses Lead to Cuts

After posting a third quarter loss of 35 million SEK (about $4.7 million), Sweden-based microlithography technology company Micronic Laser Systems AB announced today it will cut more jobs.

Micronic makes high-end laser-pattern generators used to produce photomasks. Photomasks are needed to manufacture semiconductor chips and displays (flat-panel and computer) and for semiconductor packaging components. The company also develops metrology systems for display photomasks at its headquarters in Täby, outside Stockholm. It has a US subsidiary, Micronic Laser Systems Inc., based in San Jose, Calif.

The company's operating loss for 2008 so far is 162 million SEK (about $22 million) and it has revised its outlook for the remainder of 2008 to reflect weaker market conditions in the display industry. Micronic had previously said it expected sales for 2008 to exceed those in 2007, but in light of the slowdown in the display industry, said today it expects 2008 sales to be on par with last year. In response to the worldwide economic downturn, most leading panel makers have started to cut back volumes on their existing production lines to avoid building up excess stock, Micronic said.

“We are accelerating our adaptation to the lower sales volume and cut back the number of consultants and contract personnel by around 40 people. So far in 2008 we have decreased our headcount by 26 people and are in the process of carrying out an additional staff reduction of similar size,” said Sven Löfquist, Micronic Laser president and CEO. As of Sept. 30, the company had 387 employees, down from about 426 during the first nine months of 2007.

The company said the startup of panel makers' new generation of display production lines in 2009, such as Sharp's generation 10 display manufacturing facility, is good news for Micronic, as its Prexision-10 machine is needed to produce photomasks for generation 10.

"Our view of the semiconductor pattern generator market is conservative, but we nonetheless see opportunities for additional business during the current year," Löfquist said.

For more information, visit: www.micronic.se