CHICAGO — IC Industries will take a special pretax charge of $520 million in the third quarter that will result in a net loss for the year and plans to cut 1,560 jobs at its Illinois Central Gulf railroad subsidiary, company officials have announced.
The one-time charge stemmed from costs associated with IC's corporate restructuring program and was largely to cover expenses involved in a major reduction of its rail operations, IC Chairman William B. Johnson said Monday.
Johnson said about $410 million of the charge would be used as a reserve to cover expenses involved in the rail restructuring, including costs of employee layoffs and early retirements later this year.
Another $110 million will cover costs from the restructuring of Pneumo Abex Corp., a transportation equipment subsidiary.
Johnson said the big writedown would occur this year because of more favorable tax advantages under current law and the earlier-than-expected sale of rail segments from Illinois Central Gulf.