Ameritrade Warns of Wider Loss
OMAHA, Neb. (AP) _ Ameritrade Holding Corp. warned Monday that its first quarter losses will be wider than expected and announced plans to lay off about 300 workers to cut expenses as it faces a drop in trading activity amid a the market’s downturn.
Shares of the discount online brokerage company fell nearly 9 percent on the news.
Ameritrade, one of the top 10 online brokers in the country, said in a statement it expects loss for the first fiscal quarter, ended in December, to be between 12 cents and 14 cents per share, compared with a loss of 12 cents per share in the year-ago quarter. Analysts surveyed by First Call/Thomson Financial had estimated Ameritrade’s losses would narrow to 5 cents per share.
Revenues are estimated to be in the range of $127 million to $132 million, the company said.
The results will include a charge against earnings of about $1.5 million related to the job cuts and other restructuring moves, spokeswoman Donna Kush said.
About 230 of Ameritrade’s 2,500 full-time workers will be laid off: 51 in Fort Worth, Texas, and 180 at sites in Omaha and nearby Bellevue, she said.
About 100 temporary workers will be laid off, but 40 of those positions should be filled by rehiring some of the full-time workers facing layoffs, she said.
The cuts were necessary to keep costs per trade down, Kush said.
``This was very difficult for us to do,″ Kush said. ``We had to find a way to maintain our market position.″
The layoffs follow about six weeks of tightening by Ameritrade that included letting go other temporary workers. Kush said she did not know how many temporary workers, all told, had lost their jobs with Ameritrade.
Ameritrade’s stock was off 78 cents at $8.06 a share in afternoon trading on the Nasdaq Stock Market.