Synergetics Closes Plant to Increase Operational Efficiencies

Synergetics USA will close its Philadelphia plant and merge the operations and production of generator products to its O’Fallon, MO plant. The move is part of the company’s overall strategy to continue improving product and component integration in an effort to increase operational efficiencies.

The Philadelphia plant currently has 25 employees; the company expects to record non-recurring, pre-tax severance and related costs associated with this action of approximately $400,000, with the majority of these being cash costs. Ongoing annual cost savings from the closing are expected to be approximately $1.5 million, or $0.05 per share.

Commenting on the move, Gregg Scheller, President and CEO of Synergetics, said,

“We continue to take a two pronged approach in improving our corporate performance and increasing shareholder value. As we focus on revenue generating initiatives and activities, we are also keenly aware that this must be coupled with constant improvements in our operational productivity. In addition to overall cost savings, we expect that the consolidation of production engineering and manufacturing under one roof will ultimately result in substantial improvements in product development and market response time, a key differentiator for us in the competitive landscape.”

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