R.R. Donnelley & Sons Co., the second-largest U.S. commercial printer, will cut 775 jobs, or 2.3% of its workforce and close a printing plant in Des Moines, Iowa, to reduce costs.
The closure is the second in two months. The decision to shutter the plant by July 2 was based on the plant's size and scale, the age and quality of the printing equipment and accessibility to major cities. Production is expected to be gradually shifted gradually to other plants.
The Iowa plant, acquired in 1990, prints a variety of magazines under long-term contracts, as well as catalogs and newspaper advertising inserts. The company employs a total 34,000 people.
Chicago-based R.R. Donnelley, which prints Sports Illustrated and TV Guide magazines, last week said it was considering closing the Des Moines facility. Catalogs and magazines are sending thinner publications as advertisers slash spending, which cuts into the printer's profit, according to news reports.
The layoffs come on the heels of news last month that R.R. Donnelley would close a plant in Florida and terminate 198 workers.
Last Wednesday, the company reported that first-quarter earnings, including $22 million in restructuring charges, dropped 68% as the slowing U.S. economy hit demand for advertising, magazines and books.
In the first quarter, the company’s profit from operations fell 40% to $27.9 million from net income of $46.7 million one year ago. Sales fell 3% to $1.30 billion from $1.34 billion, the company said.
The company reported earnings of $14.5 million down from $46.7 million one year ago. Before restructuring charges -- which included costs of closing printing plants in Florida, Texas and England -- net income was $27.9 million.
