SANTA CLARA, CALIF., March 29 /CNW/ - PMC-Sierra, Inc. (NASDAQ: PMCS),
today announced that it is undertaking a corporate restructuring that the
Company expects will reduce on-going annualized operating expenses by an
estimated $20 to $24 million per year.
The Company's decision to initiate cost reduction activities is part of
its on-going effort to improve its corporate operating performance and boost
productivity across the organization. The program will include the closure of
two of PMC-Sierra's R&D centers in Winnipeg, Manitoba and Saskatoon,
Saskatchewan. The total work force reduction under this restructuring is
expected to be approximately 175 positions across the organization. PMC-Sierra
currently has 1,183 employees worldwide. The restructuring will begin
immediately and is expected to be substantially complete by the end of the
third quarter of 2007.
The Company estimates the total costs and charges associated with the
restructuring will be approximately $12 million to $14 million. These costs
and charges include severance costs related to the workforce reduction as well
as costs associated with the planned closure of facilities and other related
"By improving the efficiency of our operations while focusing on our most
promising growth opportunities, PMC-Sierra will become more efficient and be
in a better position to compete and gain share in our key target market
segments," said Bob Bailey, Chairman and CEO of PMC-Sierra. "These initiatives
will better align our efforts on our strategic customer engagements in the
Fiber To The Home, enterprise storage, and other communications infrastructure
Regarding current business activity levels, the Company's revenues for
the first quarter of 2007 are expected to be between the middle to high end of
the range that was provided during the Company's webcast conference call on
January 25, 2007 following its fourth quarter 2006 earnings release. At that
time, the revenue outlook provided was a range of $98 to $105 million for the
first quarter of 2007.
Management will provide more details on the corporate restructuring and
changes in asset carrying values and related accounting charges during the
Company's first quarter 2007 conference call scheduled for April 25, 2007 at
1:30 PM Pacific Time. To listen to the call, please access the audio webcast
of the call from our corporate website at www.pmc-sierra.com. To listen to a
live version of the conference call by telephone, please dial (913) 312-1295.
A phone replay will be available 15 minutes after the completion of the call
and can be accessed by dialing (719) 457-0820 (enter access code: 3449714).
Safe Harbor Statement
This press release contains forward-looking statements, including
statements regarding PMC-Sierra's potential revenues, expense reductions and
related costs, which are subject to risks and uncertainties. Actual results
may differ from projections. The Company's SEC filings describe more fully the
risks associated with the Company's business including PMC-Sierra's limited
revenue visibility due to variable customer demands, orders with short
delivery lead times, inventory levels in the supply chain, customer
concentration, and changing environments in the different segments and regions
of the business. The Company does not undertake any obligation to update the
PMC-Sierra(TM) is a leading provider of broadband communications and
storage semiconductors for metro, access, fiber to the home, wireless
infrastructure, storage, laser printers and fiber access gateway equipment.
PMC-Sierra offers worldwide technical and sales support, including a network
of offices throughout North America, Europe, Israel and Asia. The company is
publicly traded on the NASDAQ Stock Market under the PMCS symbol and is
included in the S&P 500 Index. For more information, visit www.pmc-sierra.com.
(C) Copyright PMC-Sierra, Inc. 2007 All rights reserved. PMC is a
registered trademark of PMC-Sierra, Inc. in the United States and other
countries. PMC-SIERRA, PMCS and "Empowering People. Enabling Connectivity."
are trademarks of PMC-Sierra, Inc. Other product and company names mentioned
herein may be trademarks of their respective owners.
For further information:
For further information: PMC-Sierra, Inc. Mike Zellner, Vice President &
CFO 1-408-988-1204 or David Climie, VP Marketing Communications 1-408-988-8276
or Susan Shaw, Manager, Communications 1-408-988-8515