Guilford operations shift cuts jobs

GREENSBORO, NC — Repositioning some of its U.S. manufacturing operations, Guilford Mills said it will move some of its apparel and home fashions fabrics operations to Mexico, resulting in the loss of about 275 jobs.

The company said after the production is moved, it will downsize its Pine Grove, PA, operation but will retain it as an industrial fabrics operation. Adding up severance and other related costs, the company said it will take a $2 million charge against fourth-quarter profits later this year. With an eye to a further overhaul of its battered apparel fabrics business, Guilford said it "continues to evaluate its remaining apparel operations in the U.S., which include a dyeing and finishing operation, a printing plant and a circular knitting facility."

Hammered by imports, sales in the apparel business were virtually slashed in half during the recent third quarter, contributing to a $20.4 million loss at Guilford, compared to a much smaller year-ago deficit of $2.6 million.

Sales in the third quarter, declining in each of the company's business segments, fell by 25.3 percent, to $158.1 million from $211.7 million last year. Sales of apparel fabrics dropped off by 48.5 percent, to $38.4 million from $74.3 million last year. In the core automotive fabrics business, sales were off by 11.4 percent, to $88.0 million from $99.3 million. And sales in the home fashions segment declined by 22.2 percent, to $20.5 million from $26.3 million, weakened notably by sales of home fashions fabrics.

Guilford remains bullish on its home fashions business, which now includes the Jockey Home program, and John Emrich, ceo, said the further downsizing in apparel "is necessary in order to dedicate resources to our automotive, industrial and home fashions segments. The apparel business has served us well for over 50 years."