Amgen plans to cut up to 2,900 jobs

Amgen Inc. said it plans to reduce its global workforce by 12% to 15% and close facilities in two states as part of a restructuring that aims to focus resources on developing new drugs.

The company was a biotechnology pioneer and is the largest biotech by sales. But the products that propelled its growth are aging and some are facing the threat of low-cost competition. In announcing cost-cutting plans Tuesday, Amgen joins the ranks of Big Pharmas who have been laying off employees and closing plants. It had already emulated traditional drug makers by doing a large deal last year to add a medicine discovered outside its laboratories.

Amgen said it plans to reduce staff by 2,400 to 2,900, beginning later this year and continuing through 2015. Most of the workforce reductions are set for the U.S. and will span the range of job types, including sales representatives, an Amgen spokesman said. The company currently employs about 20,000.

The job cuts will be combined with eliminating layers of management, using fewer buildings at its headquarters site and closing two laboratories in Washington state and two manufacturing plants in Colorado, the spokesman said.

At the same time, Amgen plans to expand its drug research-and-development in the biotechnology hubs of South San Francisco, Calif., and Cambridge, Mass., as well as retain its headquarters in Thousand Oaks, Calif., with a smaller staff in fewer existing buildings.

The company expects to record restructuring-related charges between $775 million and $950 million, primarily incurred this year and next year. It expects to save about $700 million in operating expenses in 2016, but plans to use most of the savings to launch new products, the spokesman said.

Chief Executive Robert A. Bradway said the restructuring plans were announced from "a position of strength."

Amgen reported that its second-quarter earnings rose 23% as the company benefited from higher revenue and increased profitability of its arthritis drug Enbrel. The company also raised its 2014 earnings and revenue targets.

Shares of Amgen rose 3.6% to $127.74 in after-hours trading.

Last year, Amgen bought Onyx Pharmaceuticals Inc. for $10.4 billion and its flagship product, Kyprolis.

The drug was approved in the U.S. in 2012 as a treatment for a blood cancer known as multiple myeloma. Amgen is betting that current studies of Kyprolis will lead to approvals for additional uses, with study data anticipated in the current quarter. In the second quarter, Kyprolis sales were $78 million, up from $68 million in the first quarter.

Amgen reported a profit of $1.55 billion, or $2.01 a share, up from $1.26 billion, or $1.65 a share, a year earlier. Excluding acquisition-related and other items, adjusted per-share earnings rose to $2.37 from $1.89. Revenue increased 11% to $5.18 billion.

Analysts polled by Thomson Reuters expected per-share profit of $2.07 and revenue of $4.9 billion.

Sales of Enbrel increased 7% to $1.2 billion, driven mostly by higher pricing and underlying demand.

Combined sales of Neulasta and Neupogen, both of which are used to prevent infections in patients receiving chemotherapy, fell 1% as a decline in Neupogen sales offset a slight increase in Neulasta sales.

Neupogen sales fell 9%, which the company attributed to a positive Medicaid rebate adjustment in the year-earlier period. The drug is facing generic competition in the U.S. from the launch late last year by Teva Pharmaceutical Industries Ltd. of its Neupogen-similar treatment, Granix.

Sales of osteoporosis drugs Xgeva and Prolia rose 20% and 40%, respectively, with both benefiting from stronger volume.

JPMorgan cuts tech worker jobs

(Bloomberg) — JPMorgan Chase & Co., the biggest U.S. lender, is cutting hundreds of technology support employees in its corporate and investment bank amid a revenue decline, people with knowledge of the move said.

Workers in locations including New York, Tampa, Chicago and Dubai were notified of the cuts this month, said the people, who asked not to be identified because they weren't authorized to discuss the matter. Luke Moranda, a managing director in charge of clearing technology, and Dan Cronin, an executive director, were among those let go, the people said.

Wall Street firms are trimming expenses by paring support employees and moving personnel to lower-cost locales amid a decline in fixed-income trading. JPMorgan's corporate and investment bank, run by Daniel Pinto, posted a 12 percent revenue drop to $17.6 billion in the first six months of 2014, while noninterest expenses declined by 1.6 percent to $11.7 billion.

“We continue to be focused and diligent on managing expenses and operating as efficiently as possible across our businesses,” Chief Financial Officer Marianne Lake said this month in a conference call.
Moranda and Cronin didn't respond to e-mailed messages seeking comment. Brian Marchiony, a spokesman for New York-based JPMorgan, declined to comment.

Severance packages came with letters explaining that the bank's staffing needs have changed along with “changes in our business,” the people said. Some workers accepted demotions to reduce compensation costs.

JPMorgan has cut about 6,000 employees in the first six months of the year, leaving it with 245,192 workers at June 30 and exceeding a forecast in February that it would reduce total headcount by 5,000. The bank, which acquired Washington Mutual Inc.'s bank units and Bear Stearns Cos. during the financial crisis, is streamlining the group's technology systems.

Low volatility in debt and equity markets and new regulations have crimped trading, leading to Wall Street's worst start to a year in trading revenue since the 2008 financial crisis. An increase in client activity in June failed to carry over into July, Lake said on the July 15 conference call.

“Our general operating assumption is that the next two quarters will continue to have low activity year-over-year,” Chief Executive Officer Jamie Dimon, 58, said on the call. “That could change on a dime, as you know, but that's just how we're going to run the business.”

Tyson Foods to shut three factories, cut 950 jobs

(Reuters) - Tyson Foods Inc (TSN) said it will discontinue operations at three of its factories which make processed meat products such as sausages and hot dogs, affecting about 950 people.

The largest U.S. meat processor, which won the bidding war for Hillshire Brands Co (HSH) in June, said the closures were not related to the acquisition.

"The closings were under consideration long before our decision to pursue Hillshire Brands", Tyson spokesman Gary Mickelson told Reuters.

Tyson outbid Pilgrim's Pride Corp (PPC) with its $63 per share offer for Hillshire, valuing the Jimmy Dean sausages maker at $8.55 billion.

The closures were due to changing product needs, an aging Cherokee, Iowa factory and the distance of the Buffalo, New York and Santa Teresa, New Mexico plants from their raw material supply base, the company said on Friday.

"The consolidation helps them get transportation efficiencies," Chris Hurt, an agricultural economist with Purdue University, said.

The number of beef cattle in the United States is at its lowest level in 63 years due to severe droughts, reducing the amount of meat available to process.

The Cherokee factory will close on Sep. 27, while the other two are expected to stop operating in the first half of 2015.

The U.S. Department of Labor's Occupational Safety and Health Administration had cited the Buffalo factory for workplace safety hazards last November and proposed fines of about $122,000.

Tyson contested the citations and settled the case in May, agreeing to pay $105,000 in fines.

The closures will affect 450 employees at Cherokee, 300 at Buffalo and 200 at Santa Teresa. The company had about 115,000 employees as of last September.

Shares of the company, which will report quarterly results on Monday, were little changed at $39.49 in extended trading on Friday.

Microsoft to cut up to 18000 jobs

Microsoft Corp. said on Thursday it would cut up to 18,000 jobs, or about 14 percent of its workforce, as it halves the size of its recent Nokia acquisition and trims down other operations.

Microsoft confirmed it will cut up to 18,000 jobs over the next year, part of the tech titan's efforts to streamline its business under new CEO Satya Nadella.

In a statement released Thursday, Microsoft says about 12,500 of the professional and factory positions will be cut as part of its $7 billion acquisition of Nokia's handset business, which the company closed in April.

"My promise to you is that we will go through this process in the most thoughtful and transparent way possible," said Nadella in a memo to employees.

Nadella, who replaced Steve Ballmer in February, says the "vast majority" of employees affected by layoffs will be notified within the next six months. They will also earn severance and job transition help in many locations. All cuts will be completed by next June.

The layoffs by Microsoft -- which employs 125,000 people -- are the company's largest since 2009, when they cut more than 5,000 jobs.

Daniel Ives, analyst with FBR Capital Markets, says the "larger than expected" layoffs hints at Nadella's plans to simplify Microsoft's infrastructure.

"Under the Ballmer era, there were many layers of management and a plethora of expensive initiatives being funded that has thus hurt the strategic and financial position the company is in, especially in light of digesting the Nokia acquisition," says Ives. "Nadella is using today as an opportunity to make sure that Microsoft is ready and well positioned to embark on its next chapter of growth around mobile and cloud."

Microsoft expects to incur pre-tax charges as high as $1.6 billion over the next four quarters, which will include $750 million to $800 million for severance and related benefit costs, and $350 million to $800 million of asset-related charges.

Chicago : Northern Trust cuts 200 jobs

Northern Trust Corp. announced today that it will cut 200 jobs as the bank struggles to hit its minimum profitability goals even though assets have grown substantially.

Chicago's largest locally headquartered bank said the layoffs, along with other cost actions, would trim $25 million from its annual expenses. Executives said the cuts were coming from a wide array of operations within the bank and would take place over the coming year.

A spokesman didn't have immediate comment on whether and to what extent those cutbacks would hit Northern Trust's Chicago workforce. Northern Trust employs 15,100 worldwide, so the layoffs amount to slightly more than 1 percent of its employees.

The bank reported second quarter earnings of $182 million, or 75 cents per share. The per-share figure was down from 78 cents a year before and even with the 75 cents posted in the first quarter.

Northern Trust, however, recorded $42 million in pre-tax charges and writeoffs, with $28.5 million earmarked for severance. Excluding those, the bank posted earnings of 87 cents per share, higher than the Wall Street consensus estimate of 84 cents. Its return on equity excluding the one-time costs was 10.6 percent, exceeding the bank's minimum goal of 10 percent.

However, Northern Trust's return on equity with the charges included was just 9.2 percent.

The bank, which focuses on serving wealthy families and institutional investors, continues to show growth in its key business lines. Assets under custody just exceeded $6 trillion, up 4 percent from $5.75 trillion in the first quarter. Assets under management were $924 billion, up 1 percent from $915 billion in the first quarter.

Chicago : Companies warn of nearly 1,700 Illinois job cuts

Thirteen companies may cut nearly 1,700 jobs in the coming months, according to a new state report.
The biggest cuts are from commercial printer Quad/Graphics Inc., which is laying off 537 workers in far northwest suburban Woodstock, according to the June report for the Illinois' Worker Adjustment and Retraining Notification Act, or WARN.

Sussex, Wis.-based Quad/Graphics is closing a plant there, according to reports earlier this year.
The second-largest cuts are at merchant wholesale Source Interlink Distribution LLC, with 244 layoffs already made in June in its McCook office. A lost contract is prompting the cuts, the company said in the WARN report.

Dallas-based AT&T Inc. announced 188 job cuts.

Jewelry company Lia Sophia will lay off 56 workers in Roselle and 28 in its Wood Dale office by August. The company declined to say why the jobs are being cut.

Additional layoffs announced in the report:
• Ridgeway, S.C.-based construction machinery and manufacturing company Bomag America's Inc. is laying off 92 workers in its Kewanee office.
• Montgomery-based Lyon LLC, which specializes in showcase and shelving manufacturing, is cutting 74 workers in Paris.
• Atlanta, Ga.-based Morrison Healthcare, a food service contractor, warned of 62 cuts because of a lost contract, according to the report.
• Fresenius Medical Care, a German company that produces medical supplies, is laying off 53 workers in its Westchester office. The reason was not provided.
• A liquidation at Chicago-based Sound Solutions Windows & Doors LLC is permanently laying off 52 workers.
• Chicago-based Lawrence Hall Youth Services, offering child and youth services, is cutting 51 workers due to a closing of an Elgin office. A representative said the Elgin office is closing because their services were no longer needed in the area.
• Eden Prairie, Minn.-based Supervalu Inc. will cut 44 workers in Urbana. The cause was not provided.
• Springfield, Mass.-based Hot Mama's Foods will cut 34 workers. A reason was not disclosed.
Representatives from these companies did not respond immediately today to calls requesting comment.
Also in the report: Chicago-based Magid Glove & Safety Manufacturing Co. is moving 156 workers from its current manufacturing facility to a new one opening in Romeoville. The company reports that it is not laying off any of those employees.