Fathom Digital Manufacturing plans to consolidate its Oakland, California facility into its headquarters in Hartland as part of a reorganization plan aimed at saving around $5.5 million annually.
The move will add 10 to 15 jobs at the Hartland facility, Fathom chief executive officer Ryan Martin said. The company, which offers an on-demand digital manufacturing platform, has made more than $3 million in
capital investments in the facility over the past 12 months, including two five-axis machines for precision machining work and new additive manufacturing equipment for metal and large nylon plastic part 3D printing.
Fathom’s reorganization plans also call for an overall 6% workforce reduction. The company’s latest securities filings indicate it had 706 employees as of Dec. 31, suggesting the elimination of a little more than 40 positions.
Martin noted the reduction will be net of new hires and said the company anticipates adding jobs overall at its Hartland headquarters. The reorganization plan calls for the creation of an accounting shared service organization to help streamline company-wide processes and similar approaches to other administrative functions are also possible.
Fathom was started in 1984 as Midwest Composite Technologies but rebranded as Fathom in 2019 after the acquisition of Kemeera. Since 2019, the company has made 13 acquisitions, adding manufacturing capabilities and geographic coverage to its operations, but also creating the eventual need to streamline operations.
The company’s revenue in 2020 was a little more than $61 million compared to more than $152 million in 2021. Most of the growth was due to acquisitions, although the company did see an 8.8% organic sales increase. Around 35% of its revenue came from precision sheet metal work while CNC machining accounted for 28%, injection molding accounted for around 19% and additive manufacturing was responsible for almost 12%.
“Yesterday’s announcement was about accelerating our growth and enhancing Fathom’s position for long-term value proposition for our customers. This move reconfirms our commitment to Wisconsin, but also to our customers across the country as we also announced that we will be opening an additive technology center in the Bay Area,” Martin said.
While the company is consolidating its Oakland facility into its Wisconsin operation, Fathom is also planning to establish a technology center in the Bay Area to focus on new and emerging technologies in the additive manufacturing market.
“This new facility will provide a unique opportunity to highlight our emerging technologies as we continue to expand our leading platform and meet the demand for our broad manufacturing services. The technology center will also be our hub for all our current Bay Area leadership, sales, marketing, IT, and other functions,” Martin said.
Fathom anticipates incurring around $2 million in restructuring charges to execute the plan, including $800,000 in severance and employee-related costs, $800,000 in moving and relocation costs and around $500,000 in fixed asset and write-down expenses.
