Fico Cuts 200 Positions, 20 in MN; Ups Forecast
Fico announced Wednesday that it will eliminate 200 positions, or about 9 percent of its 2,200-person companywide work force.
Twenty Minnesotans will lose their jobs-or about 6 percent of the Minneapolis-based software and analytics company's 335-person local work force, according to spokesman Jason Sprenger.
“The cuts affect a lot of different departments,” Sprenger told Twin Cities Business on Thursday morning, adding that affected employees started to be notified about the reductions on Wednesday.
The layoffs are part of a restructuring effort that began in 2008. Late that year and early in 2009, Fico eliminated 250 positions in order to adjust to the slowdown in financial markets, where many of its clients are concentrated.
In addition to the just-announced layoffs, Fico said Wednesday that it is also implementing facility consolidations and reductions in discretionary spending.
Despite the restructuring efforts, Fico has revised its financial guidance for fiscal 2011, which ends in September. The company now expects net income of $70 million to $73 million, up from a previously expected $65 million to $67 million. Earnings per share are also now expected to be between $1.75 and $1.83 per share, up from the range of $1.63 to $1.68 per share.
“We've seen the beginnings of growth in recent quarters, and have chosen to maintain our cost reengineering discipline in this improving environment in order to compete more aggressively and win more deals,” CEO Mark Greene said in a statement. “We've made it a priority to allocate resources toward product innovation, client service, and revenue-producing activity.”
The company said that the just-announced staff reductions are expected to result in a $10 million charge in the second quarter of fiscal 2011, or 18 cents per share.
Fico, which is legally called Fair Isaac Corporation, is among Minnesota's 40-largest public companies based on its revenue, which totaled $605.6 million in the fiscal year that ended in September 2010-down 4 percent from the prior year.
The company invented the concept of Fico scores-credit scores that have become an industry standard for assessing consumer risk and are widely used as a tool to help lenders, credit-card issuers, and banks make lending decisions.