Entrust Announces 400 Job Cuts
DALLAS (AP) _ Entrust Inc., a struggling Internet-security company, said Monday it would cut 400 jobs _ 30 percent of its work force _ and close some offices.
The company said it would take a $400 million charge in the second quarter to cover the costs of severance packages, office closings and other items.
The Plano-based company also changed its name, which had been Entrust Technologies.
Entrust was spun off from Canadian telecommunications giant Nortel Networks in 1997. Less than a year ago, Entrust shares traded at $83.50, but they fell by nearly half in one day after the company warned earnings would fall well short of expectations, and kept sliding into single digits.
In midday trading Monday, shares fell 54 cents to $5.90 on the Nasdaq Stock Market.
Bill Conner, a former Nortel executive recently named Entrust’s president and chief executive, said the changes were part of his 90-day plan to restructure the company’s operations and return to profitability.
Conner said the company would focus on key markets, including financial, government and large international businesses. He said the company would also work with computer system consultants and strategic partners to expand sales of its services.
Entrust provides identification, privacy and security management services to Internet sites. It also sells software to manage Internet business Web sites. Nortel owns about 26 percent of Entrust stock.
The company’s stock plunged last July after the company said earnings would be only one-fourth of expectations because expected deals were not closed. Investors accused the company of covering up revenue shortfalls in order to protect its share price while it completed a $700 million acquisition of enCommerce Inc. of Santa Clara, Calif.