EB started measures to improve its cost structure in the Wireless Business Segment on February 19, 2013. The measures were completed on April 4, 2013 and the Company estimated to reach the targeted, approximately EUR 2 million annual cost savings in its Wireless Business Segment, fully effective from the second half of 2013 on. The measures resulted non-recurring costs of approximately EUR 0.8 million that affect negatively the Company“s operating result of the first quarter of 2013. The underlying reasons for the measures to improve the cost structure were the changed business requirements. As part of these measures, EB reduced its personnel in the Wireless Business Segment globally by altogether 32 persons, 8 of them in Finland. In addition, EB also concentrated some of its Wireless Business Segment operations to Finland and moved the centre of its US operations from west coast to east coast, where many of the public sector customers are located.
On August 22, 2013 EB concluded personnel negotiations that were started on August 8, 2013 in the Wireless Business Segment and decided to adjust its cost level to correspond the weakened demand outlook for the rest of the year. The temporary layoffs were estimated to last no longer than until the end of January 2014. With temporary layoffs EB aimed at EUR 1.5 million cost savings, which were expected to materialize mainly during the fourth quarter. The Company stated that the need for temporary layoffs and thereby actual cost savings may however change as the outlook for the rest of the year specifies.
EB decided on November 15, 2013 that no further temporary layoffs will be made. Between September 2013 and January 2014 EB temporarily laid off altogether 74 employees for a maximum of 90 days, part or full-time. With these measures the Company estimated to reach approximately EUR 0.8 million cost savings, which were expected to materialize mainly during the last quarter of the year. Due to the Wireless Business Segment“s specified outlook for the rest of the year, the amount of temporary layoffs was reduced from the earlier estimated maximum amount. The materialized temporary layoffs were reduced to 64 persons and the cost savings achieved were EUR 0.6 million.