Xerium Technologies of Youngsville is continuing to cut costs by eliminating jobs as it negotiates with its lenders to avoid defaulting on its debt.
The maker of equipment used in paper production eliminated 27 jobs in the latest quarter, on top of 349 in the first half of the year -- about 10 percent of its staff. Xerium, which also cut 100 jobs last year, disclosed the cutbacks earlier this month during a conference call to discuss its third-quarter results.
It's unclear how many jobs have been eliminated at the company's Youngsville headquarters, which had 60 employees at the outset of the year. Xerium officials couldn't be reached for comment.
The company has struggled with declining demand for its equipment. Sales in the third quarter totaled $130.3 million, down 18 percent from a year ago. However, sales were 8 percent higher than they were in the second quarter.
Xerium lost $7.4 million in the quarter, compared to a profit of $21.5 million a year ago.
The company, which has more than $600 million in debt , wasn't in compliance with its debt covenants as of Sept. 30 but obtained a waiver from its lenders until Dec. 15. The company is seeking to renegotiate terms with its lenders.
"Any such initiatives the company pursues are likely to severely dilute its existing stockholders and may result in its existing common stock having little or no value," the company cautioned in a recent Securities and Exchange Commission filing.
Xerium has been down this road before. Last year it avoided bankruptcy by successfully restructuring its debt.
Xerium shares closed Friday at 58 cents, down 1 cent.