Following the loss of its largest contract last month, global defense contractor Vectrus laid off 64 employees from its Colorado Springs headquarters Oct. 18 in a realignment effort.

The reduction will cost the government services firm $2 million in severance expenses, but Vectrus anticipates an annual $8 million in savings from the change, according to a news release.

The restructure includes consolidating the firm’s infrastructure and logistics services; it  began earlier this year when the company eliminated 18 unfilled positions at headquarters.

A variety of positions have been eliminated across multiple departments, said George Rhynedance, chief communications officer for Vectrus.

“All positions were considered in this action and we are confident that we have appropriately sized the headquarters to current business conditions,” he said.

On Sept. 30 the firm lost its contract to provide base operations and security support services for the Area Support Group Kuwait, providing $218 million in revenue during the first half of the year. A month earlier, Vectrus also lost the Army Prepositioned Stock-5 contract for global logistics in Kuwait and Qatar that provided $93 million in revenue in the first half of the year.

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“The reduction in staffing, while difficult, is a necessary action for Vectrus in order to maintain its competitive position in the marketplace,” Vectrus CEO and president Ken Hunzeker said in the release. “The corporate realignment will build on and strengthen the organizational efforts initiated earlier this year by placing certain business functions closer to the associated service offering, to improve our ability to secure future contract awards.”

Vectrus has 132 locations in 18 countries and provides services including infrastructure asset management, information technology and network communication services to U.S. government customers throughout the world.