Cardica laying off a quarter of its staff to save cash
Cardica, the Redwood City medical device maker, announced its second layoff since the start of the year as the company struggles to conserve cash, according to a filing with the SEC today.
The move will eliminate an estimated 22 employees, reducing its staff by about 27 percent. The cuts, which are to be completed before the month ends, is expected to save $3 million on an annual basis, but will cost the company an estimated $220,000 in severance and $30,000 in outplacement services.
The company, which supplies systems used by surgeons performing coronary bypass procedures, announced a previous job force reduction in January, when it let go 13 people, or 13 percent of its staff at the time. The company also pegged the savings of those layoffs, which were half the size of the ones it announced yesterday, at $3 million.
Cardica said at the time that its January decision was based on a “corporate strategy to bring (its) cash usage in line with (its) available cash, with the goal of allowing (it) more time to operate independently of the capital markets.”
As of the end of its December quarter, Cardica reported about $13 million in cash and short -term investments, down from more than $30 million the year before. During that same quarter the company burned through about $7 million operating its business.
