OTTAWA, Nov. 12 /CNW Telbec/ - Tundra Semiconductor Corporation
(TSX:TUN), a leader in System Interconnect, announced today that the Company
is implementing a restructuring plan to immediately adapt its cost structure
to the rapid Canadian dollar movement and telecom market conditions.
"Two contributing factors compelled Tundra to make the decision today to
reduce our overall expense base, including both elimination of positions and
reduction of other operating costs. The rapid appreciation of the Canadian
dollar is putting significant pressure on our financial results as indicated
in Tundra's recently revised guidance for the second quarter. The
strengthening Canadian dollar has resulted in a near 15% reduction in Tundra's
top line revenue over the last several quarters. In addition, the
communications market is currently experiencing an industry slowdown," said
Daniel Hoste, President and Chief Executive Officer, Tundra Semiconductor. "We
have responded rapidly to this market and economic volatility to address our
short term cost requirements and to protect our long term strategy. We have
carefully executed this restructuring initiative to ensure that rolling out
our planned product roadmaps and realizing our long term growth plan is
achieved," continued Hoste.
The restructuring initiative will reduce Tundra's headcount by
approximately 30 positions. Restructuring charges of approximately $4 million
will be recorded in the third quarter of fiscal 2008. Cost savings as a result
of this activity are expected to be approximately $1.5 million on a quarterly
basis comprised of $1 million in research and development and $0.5 million
from sales, general and administrative. The effect on fiscal 2008 third
quarter financial results will be reflected in the guidance which the Company
will provide on November 29th in its fiscal 2008 second quarter earnings
CONFERENCE CALL AND WEBCAST
Tundra management will be holding a conference call today, November 12 at
5:30 p.m. EST to address questions regarding this announcement. You may access
the conference call via any of the following:
Replay: +1.416.640.1917 Pass code: 21253216#. The replay will
be available through November 19, 2007.
About Tundra Semiconductor
Tundra Semiconductor Corporation (TSX:TUN) supplies the world's leading
communications, computing and storage companies with smart System Interconnect
products, intellectual property (IP) and design services backed by world-class
customer service and technical support. Tundra's track record of product
leadership includes over a decade of bridges and switches enabling key
industry standards: RapidIO(R), PCI, PCI-X, PCI Express(R), PowerPC(R), VME,
HyperTransport(TM), Interlaken, and SPI4.2. Tundra's products deliver high
functional quality and simplified board design and layout, with specific focus
on system level signal integrity. Tundra's design services division, Silicon
Logic Engineering, Inc., offers industry-leading ASIC and FPGA design
services, semiconductor intellectual property and product development
consulting. Tundra's smart technology connects critical components in high
performance embedded systems around the world. For more information, please
Tundra Semiconductor Corporation is a public company with common shares
listed for trading on the Toronto Stock Exchange (TSX:TUN) in Canada. All
figures, unless otherwise noted, are stated in Canadian dollars in accordance
with accounting principles generally accepted in Canada.
The Company cautions that the forward-looking information in this release
is based on certain assumptions made by the Company that may prove to be
inaccurate. Assumptions made include, but are not limited to; the anticipated
costs and resulting savings related to or that may result from the
restructuring, the Company's ability to bring to market the products currently
under development, customer demand for the Company's products and services,
and the Company's ability to maintain and enhance existing customer
relationships, and leverage existing partnerships.
Furthermore, the Company cautions that the forward-looking statements in
this release are based on current expectations that are subject to risks and
uncertainties. Actual results may differ due to factors such as lower than
anticipated cost savings, new product development, customer demand, customer
and partner relationships, new services offerings, product shipping schedules,
product mix, competitive products and services, pricing pressure, exchange
rate fluctuations, and changes in the embedded systems market specifically.
Additional information identifying risks and uncertainties is contained in the
Company's filings with the various provincial securities commissions.
TUNDRA and the Tundra logo are registered marks of Tundra Semiconductor
Corporation in Canada, the United States, the European Union and the People's
Republic of China. Design.Connect.Go. is a trademark of Tundra Semiconductor
Corporation. Other registered and unregistered trademarks are the property of
their respective owners.
(C) Copyright 2007 Tundra Semiconductor Corporation. All rights reserved.
Information subject to change without notice.
For further information:
For further information: David Long, Chief Financial Officer, Tundra
Semiconductor, (613) 592-0859 ext. 1704, David.email@example.com