Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.
+1 212 318 2000
Europe, Middle East, & Africa
+44 20 7330 7500
+65 6212 1000
Aircraft maker Hawker Beechcraft gave 60-day layoff notices to about 350 workers at its plant in Wichita on Monday, about a week after it reported a nearly $633 million net loss for 2011.
The company, which manufacturers business and military aircraft, cited market conditions for the move in a letter sent to employees. The company is struggling under a debt burden of more than $2.33 billion, according to its recent Securities and Exchange filing, and has been renegotiating its debt with its lenders.
"While we have experienced success with our transformation, market conditions are requiring us to adjust our overall production cadence to help ensure the company will compete effectively in the future," company executives said in the letter dated Monday.
"This remains a difficult, unprecedented time for our company, our employees and our industry," they added, asking employees to remain focused on their jobs "as we carry on our effort to become a smaller, more agile company."
The company insisted in an email Monday that the layoffs wouldn't affect its agreement to keep its aircraft operations in Kansas for 10 years as part of a $45 million deal with state and local officials. The company agreed in 2010 to maintain current aircraft lines and keep at least 4,000 jobs in Kansas until 2020.
Phone messages and emails seeking comment from Gov. Sam Brownback's office and from the president of the machinists' union representing Beechcraft workers weren't immediately returned late Monday afternoon.
The company's annual statement, filed with the SEC on April 13, showed losses from operations of $481.8 million in 2011. But those losses swelled to a $632.8 million net loss when adding in other expenses -- such as the $135.6 million in interest payments last year by the heavily indebted company, according to the filing.
Hawker Beechcraft's financial woes come as it struggles under a debt burden it has carried since 2007, when Raytheon Aircraft sold off the company. Its SEC report listed a total debt of more than $2.33 billion as of the end of last year.
It's unclear how many employees the company now has in Kansas. As of November, the Wichita plant employed 4,700 workers. Company spokeswoman Nicole Alexander said Monday that she didn't have a current employment number.
According to its SEC filing, the company employs 7,400 people, including workers at its plant in Little Rock, Ark. Beechcraft also has plants in England and Mexico, and has more than 100 service centers worldwide.