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Hawker Beechcraft To
Layoff 350 Employees, May Seek Bankruptcy Protection By Mike Mitchell |
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April 25, 2012 - Back in March Hawker Beechcraft began
to announce employee layoffs in its various departments
and employees working on various aircraft including the
Beechcraft King Air, Piston and Premier IA and the
Hawker 4000 and 987 family. On Monday the company sent
out layoff letters
to its employees in its Wichita operations.
Hawker Beechcraft which employs over 7,400 employees
announced the company would furlough 350 employees. In
the notice the company stated affected employees are
receiving a 60 day Worker Adjustment and Retraining
Notification (WARN) as a result of the company?s
difficulties in obtaining adequate materials in order to
continue production as well as matching production to
demand. Company furloughs will be on a rolling basis and
are expected to occur for one to two months. Each
furlough will last thirty to forty-five days.
Hawker Beechcraft?s CEO Chairman, Steve Miller said ?We
continue to manage our way through a challenging and
rapidly changing environment while implementing
transformations across our company. While we have
experienced success with our transformation, market
conditions are requiring us to adjust our overall
production cadence to help ensure the company will
compete effectively in the future.?
Miller further stated ?This remains a difficult,
unprecedented time for our company, our employees and
our industry. I ask that we all uphold our pattern of
respect and care for our impacted colleagues, and remain
focused on our jobs as we carry on our effort to become
a smaller, more agile company that will remain
competitive in the future.?
In
the company?s
annual report filed April 13, 2012, with
the Securities And Exchange Commission, the company
indicated that ?certain key suppliers have indicated
that they may cease providing supplies to us on normal
credit terms or at all based upon our current financial
difficulties and payment terms which we are employing.? |
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CEO Chairman, Steve Miller | ||||
Robert S. (Steve) Miller, CEO of Hawker Beechcraft, said
the annual report ?filing reflects the combined effect
of the prolonged weakness in our market that has
continued to affect our business and the heavy debt
burden the company has operated under since 2007. Hawker
Beechcraft continues to work closely with our lenders to
restructure the company?s balance sheet, and to do so as
quickly as possible.
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?In the coming weeks, we expect to decide on a path
forward for Hawker Beechcraft that will include a plan
that will put the company on firm financial footing and
better position Hawker Beechcraft for the future. As we
move forward with this process, we remain steadfast in
our commitment to building, selling and servicing the
best airplanes for our civilian and military customers.?
Within the annual report the company further stated that
its ?Management has concluded that there is substantial
doubt about the Company?s ability to continue as a going
concern.? This conclusion was based on a number of
factors; a downturn in the economy which translates into
fewer orders, its inability to pay on interest
obligations and inability to raise sufficient capital in
the stock market.
In
addition it was stated in the report that the company?s
financial difficulties are due to its substantial debt,
as of December 31, 2011, $2,334.1 billion. This debt may
have future consequences in that the company may not be
able to satisfy its obligations, ability to obtain
additional financing for working capital, a substantial
portion of cash flow is being used to pay on interest
and principal and may not be able to capitalize on
business opportunities.
In
February 2010 an entity affiliated with Goldman Sachs &
Co. and Onex Partners II LP completed open-market
purchases of $152.8 million of the company?s outstanding
notes. The debt continues to incur interest in
accordance with the terms of the debt.
Hawker Beechcraft Corporation (HBC) is an aerospace
manufacturing company that builds the Beechcraft and
Hawker business jet lines of aircraft. The company
headquarters is in Wichita, Kansas with maintenance and
manufacturing locations worldwide. |
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