Ergo restructures to secure 'sustainable future'

System builder says decision to cut more jobs was 'difficult yet necessary'

System builder Ergo Computing says its decision to undergo a second round of restructuring under new parent VIP Group is necessary to secure a "sustainable future".

The Nottingham-based firm, which swung to a £0.5m loss in 2014, today announced it is making a "limited number" of personnel cuts following a company-wide review.

This follows an initial restructure that followed its £1.3m acquisition by VIP Group in January 2014.

VIP Group human resources manager, Loran Archer, described the cuts as a "difficult yet necessary decision".

"We are confident that moving forward the new structure will deliver the business efficiencies Ergo requires for a sustainable future. I would like to reinforce that Ergo remains committed to delivering a market-leading service to its customers," she said.

"Ergo is currently undergoing a consultation period with the individuals affected by today's announcement and will be looking to find suitable opportunities elsewhere in the VIP Group."

Under an initial restructure conducted last summer, VIP moved Ergo's support and manufacturing functions from Nottingham to its headquarters in Warrington. Some 45 staff remained in the Nottingham office, however, in roles including product management, sales, account management and engineering.

VIP said in its most-recent annual results that it expected Ergo to break even in its fiscal 2015 ending 30 June and to turn a profit in fiscal 2016. For the year ending 30 June 2014, Ergo sank to a £510,000 loss during the six-month period in which it contributed to VIP's numbers, with revenues of £2.7m also trailing the distributor's expectations.

The latest restructure comes three months after Ergo co-founder Neil Bellamy exited the PC builder, 25 years after setting it up.