US soft drinks firm Jones Soda is cutting 38% of its workforce, as the company looks to reverse sales and profit declines.

Seattle-based Jones has implemented a reduction of around 42 members of staff, in a bid to reduce ongoing operating expenses and improve the group's efficiency, it said in a stock exchange filing.

It hopes the cuts will save around US$2.6m in expenses annually. 

Jones Soda posted a drop in sales and profits for its second quarter, with net revenue down from US$13m to $11.7m, and a net loss of $2.7m for the period ended 30 June.

Severance and termination benefits to the affected employees are not expected to be material to the company's financial results for the fourth quarter of 2008, Jones said.

Following the cuts, 68 employees will remain in the workforce.