Axis announces cost savings program

Axis Communications will initiate a cost savings program in the fourth quarter of 2003. The purpose of the program is both to balance the negative effects of a weak overall economy and to secure means for future growth as well as Axis' financial goals.

The last two years Axis has experienced growth within the Video segment, but at the same time total sales has been burdened by a weak market for the company's more traditional IT products. The slow economy has led to a continuous focus on cost control, which among other things has led to a decrease in numbers of consultants in the first half of 2003. "Even if there are signs of slow recovery on several markets, we still see a lot of restraints in IT investments," said Ray Mauritsson, CEO of Axis. "With this in mind we have now decided to go ahead with further cut backs to secure a stable and positive long-term development." The objective is to ensure savings of about 15 MSEK on an annual basis. Decision has been made to initiate negotiations with unions since the savings program might include staff reductions of about 10 percent of Axis' employees in Lund. The cost cuttings are estimated to be effective in 2004.