Valassis Communications will reduce its United States workforce by 3%, according to forms filed with the Securities and Exchange Commission. The layoffs come on the heels of a third-quarter 2008 loss of $5.2 million, compared with net income of $16.4 million in third-quarter 2007.
According to Securities and Exchange Commission documents, as of the end of 2007 Valassis employed 5,450 people in the U.S. A 3% reduction would result in 165 employees losing their jobs. The layoffs, according to SEC documents, are expected to take place during the fourth quarter, to be finished by the end of the year, and to cost the company $3.5 million in cash payments.
In addition to the 5,450 domestic staff, the company also employs just over 2,000 workers internationally.
In addition to the loss, Valassis recorded revenue of $563.7 million during the third quarter, a drop of 7.2% from the $607.2 million it generated in third-quarter 2007.
Within its segments, Shared Mail revenue was $327 million, down from $346.6 million. Seven of this unit’s top 10 categories experienced revenue declines, according to a company filing. While the company delivered 0.9% more packages during the quarter (1 billion in total), the average number of pieces per package dropped by 1%, to 7.9 per package.
Its Neighborhood Targeted product revenue was $107 million during the most recent quarter, a drop of $10.4 million from a year ago. According to Valassis, some of this business shifted into the Shared Mail category, and the telecom and food client base did not spend as much as they had in quarters past.
The company’s FSI unit saw its revenue slump from $102.6 million a year ago to $91.4 million. Valassis attributed this decline to reductions in pricing as well as a 5.2% decline in volume.
