Orbotech Ltd. (Nasdaq: ORBK) today sent pink slips to 50 employees, including 10 in Israel, as it tries to adjust its manpower to a slump in orders for inspection equipment for flat panel displays (FDP). The company's FDP business has been weak in recent quarters, and it does not expect orders to increase in the coming months.
Orbotech has 1,750 employees, including 650 in Israel and most of the rest in Asia. The company acquired its FDP business through its acquisition of Photon Dynamics of the US for $290 million in October 2008, at the outbreak of the previous global economic crisis.
2011 was supposed to be a record year for Orbotech's business, with $570 million in sales, 7% more than in 2010. However, most of the growth was in its inspection equipment for printed circuit board (PCB) business, which more than compensated for the drop in its FPD operations.
This is not the first time that Orbotech has fired employees. In late 2008 and early 2009, following the acquisition of Photon Dynamics, it fired 20% of its workforce, and cut salaries of the remaining employees, due to the plunge in revenue during the economic crisis.
In an interview with "Globes" two months ago, Orbotech president and CEO Rani Cohen said, "If the crisis worsens, at some point, we will have no choice but to fire people. It's unrealistic to promise that there won't be layoffs; it depends on the depth of the crisis."
Earlier this week, it announced that founder Dr. Koby Richter, who owns 7% of the company, rejoined the board of directors. His brother, Yochai Richter, is Orbotech's chairman.
Orbotech's share price rose 1.2% yesterday to $10.10, giving a market cap of $436 million. The share price fell 25% in 2011.
Published by Globes [online], Israel business news - www.globes-online.com - on January 4, 2012
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