Anittel buyer Inabox to save $3m by cutting jobs and closing office

Publicly listed ICT provider Inabox has announced redundancies and closure of premises in the wash-up of its Anittel buyout.

Inabox announced to the ASX that it had identified more than $3 million of potential cost savings to be made before July. The cuts come in the aftermath of the 1 January acquisition of national IT services provider Anittel.

CEO and managing director Damian Kay told CRN that redundant positions have been identified: "It includes a number of different roles… and will affect about 5 percent of the staff [of Inabox Group].

"We've made a tough but necessary decision to not have any duplicate roles."

Inabox currently has more than 200 employees spread around 14 offices, with Anittel bringing about 130 at the start of the year.

Office numbers will also decrease, with Kay singling out Anittel's North Sydney premises as an example of imminent closure.

"We obviously have duplicate offices in Sydney. The lease finishes in April and we've enacted our right to terminate. We'll make room at Hunter St [headquarters in Sydney CBD] to accommodate those staff."

The current half year would bear "significant non-recurring restructuring and transaction costs", stated the company, without specifying the amount of the one-off costs.

The ASX announcement also said that $1 million of the $3 million saved would be "reinvested", including adding new sales staff to offset the current redundancies.

"Yes, there's been cost cutting measures across the organisation, including head count. But we're reallocating those resources into growth initiatives," Kay told CRN.

The news comes after Inabox chief operating officer and executive director Paul Line announced his resignation last week. Line departs 1 May.

"Paul has made a substantial contributuion as a key executive since Inabox's founding," Kay said at the time.

CRN reported earlier this month that Inabox's revenue was down 3.5 percent and net profit was down 21.1 percent for the half year to 31 December. The company said that the cost savings announced today were not reflected in previous forecasts.