By Noor Zainab Hussain
(Reuters) - Oxford Instruments Plc (L:OXIG), a maker of nanotechnology tools, said it cut 7 percent of its workforce, or 160 jobs, to reduce costs as trade sanctions hit sales in Russia.
Shares in the company, which reported a slump in full-year adjusted pretax profit as it also battled slower-than-expected recovery in Japan, fell as much as 6.37 percent on Tuesday morning to rank among the largest percentage losers on the London Stock Exchange.
The company said it now estimates cost savings of around 8 million pounds this financial year, higher than the 6 million pounds it earlier expected to add to its operating profit 2015/16 onwards.
Oxford Instruments, which makes maintenance systems and parts for CT and MRI scanners, said the cost reduction plan included the closure of six of its smaller sites, to be completed by the end of the first half.
Chief Executive Jonathan Flint told Reuters three of those sites had already been closed. The six are located in Germany, the UK, the United States, Japan and China.
Flint said the company expects to return to organic growth in the coming year and sees potential for margin improvement in the medium term, driven by new products including a new version of an electron microscope.
Oxford Instruments said its full-year adjusted pretax profit slumped 24.4 percent, partly because export sanctions resulted in the withdrawal of existing export licences in Russia, causing previously booked orders to be cancelled.
The company does not provide a break down of revenue from Russia, but Finance Director Kevin Boyd told Reuters in November that Russia contributed about 2 percent to first-half sales compared with 5-6 percent in previous years.
Oxford Instruments said it had seen a pick-up in the order run rate in Japan, and Flint added that he expected Japan to return to its traditional level of about 10 percent of the company's turnover either this year or the next.
Shares in the company were down 4.878 percent at 1014 pence at 0821 GMT.
($1 = 0.6507 pounds)