Aquila Affiliate Takes $1.7 M Charge, Cuts 60 Employees
Citing a restructuring plan formulated to deal with poor 1998
earnings, Aquila Energy's Aquila Gas Pipeline Corp. (AQP)
announced Tuesday it will cut 60 people from its staff of 310. The
cuts will inflict a $1.7 million pre tax charge on the company's
In 1998, AQP fell prey to low oil and gas prices. The company
was set to be auctioned off over the summer but was taken off the
auction block when low gas liquids prices threatened Aquila
Energy's ability to realize full value.
For the year, AQP's net income was $4.9 million or $.17 per
share compared to 1997 net income of $25.2 million or $.86 per
share. Cash flow from operations was $32.6 million in 1998, down
from the 1997 level of $56.7 million.
"To be viable in this environment, we had to take a hard look at
our business processes and our structure to determine the best way
to run our business going forward," said Joe Becraft, CEO of Aquila
Gas Pipeline. "The reorganization announced today was developed as
a result of this undertaking."
The company, which is 82% owned by Aquila Energy, expects the
measures to save up to $5 million annually. The layoffs will occur
in the San Antonio headquarters and various field locations.
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