Anaheim High-Tech Incubator Odetics to Cut Losses by Laying Off 25% of Staff

Odetics Inc., a high-technology incubator that has posted operating losses the last four years, said Thursday it will cut its work force by 25%.

The Anaheim company’s stock tumbled nearly 33%, or $2.38 a share, to $4.88 in Nasdaq trading, the 10th largest loss in U.S. markets. Earlier in the session, the shares hit a 52-week low of $4.44.

The company didn’t disclose the number of jobs it will eliminate. The company’s annual report in June listed a total of 569 employees, which means about 140 workers could be getting pink slips.

Odetics also said it will take a charge of $8 million to $9 million in its fiscal third quarter ended Sunday related to the cuts and a reorganization aimed at reducing operating expenses and negative cash flow.

The company’s operating losses surpassed $64 million over the last four years, including a loss of nearly $38.7 million in the last fiscal year.

As an incubator for technology businesses, the company relies on access to private and public equity capital to finance the growth of these operations, Chief Executive Joel Slutzky said in a press release.

“Given the conditions in the equity capital markets we have found it increasingly difficult to complete some of our planned transactions,” he said.

As part of the reorganization, Odetics will fine-tune each of its business units. The Broadcast Inc. unit will reduce its operations to focus on software-content management and delivery systems in an attempt to reach profitability and cash-positive operations. The Gyyr Inc. unit also will shrink its operations to focus on data storage, where it has strong market share and brand recognition.

The Iteris unit will focus on achieving profitable growth in its systems and Vantage businesses, despite being unable to find acceptable equity financing.

Dow Jones Newswires and Bloomberg News were used in compiling this report.