Baltimore to overhaul

July 5, 2001 Posted: 0759 GMT

LONDON (CNN) -- Former London tech star Baltimore Technologies said on Thursday it would cut jobs to reduce costs because of tough market conditions.

The Ireland-based Internet security company said its restructuring would cause a "significant" reduction in staffing.

Shares in Baltimore (BLM) dropped 24 percent to 18 pence in London after the programme was announced. They were as high as £13 in March 2000 during the tech boom.

"In common with many other technology companies across the world, the trading environment for Baltimore Technologies remains challenging," said Chief Executive Fran Rooney in a statement.

Baltimore employs over 1,000 people, but has not disclosed how many workers will have to leave.

The company announced 250 job cuts in May and Baltimore's latest restructuring adds to the tech gloom after UK telecoms equipment maker Marconi (MONI) announced a further 4,000 job cuts on Wednesday.

Tech companies have been cutting staff as a U.S. economic slowdown has fed through to Europe and led to delays in orders and reduced demand.

Baltimore said its overhaul would save about £14 million ($19 million) a year in costs.

"The programme will involve fundamental change across the business including a significant reduction in head count," Baltimore said, without giving details.

Baltimore forecast revenue for the three months to June 30 below analyst forecasts, but "in excess of £15 million" .

On May 15, the company posted a 17 percent fall in revenue for the first three months to £23.7 million compared with £28.4 million in the final quarter of 2000.

Baltimore, which had previously issued two revenue warnings this year, posted first-quarter losses before interest, tax, depreciation and amortization of £17.2 million, double the £8.7 million of the last quarter of 2000.

U.S.-listed Baltimore (BALT: Research, Estimates) shares closed down 3.5 percent at $0.83 on Nasdaq on Tuesday. If the share remains below that $1 mark for 30 days then Nasdaq can end its listing.

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