AVX issues cutbacks warning

Electronic component manufacturer AVX, which employs 800 people in Northern Ireland, has warned that an industry-wide slump will force it to cut manufacturing and administration costs across the group.

The Japanese-owned firm has said its fiscal first-quarter earnings have fallen by almost 76 per cent because of continuing falling demand for its product.

Mr Dick Rosen, chairman of AVX, which is part of the Japanese-headquartered Kyocera group, said its net sales were $365.1 million (#428.7 million) for the first quarter to June 30th. He said the outlook for the next quarter was brighter but the group was under pressure to keep costs under control.

"We continue to respond to the industry-wide slump in demand by reducing production and vigorously reducing manufacturing and administrative costs."

He added that although sales and earnings would still be under strong pressure next quarter, its customers' expectations showed improved order levels toward the end of the September quarter.

The company is one of the world's leading manufacturers and suppliers of a broad line of passive electronic components and related products. Any slowdown in its global production could have a marked impact on its Northern Ireland operations, which just last month laid off 100 people because of deteriorating market demand. AVX, with two facilities in the North, has so far invested more than £95 million sterling in the North.