InFocus announced a comprehensive restructuring plan in its overall effort to return the company to profitability in the first half of 2006, the company said.
First, InFocus said it will simplify and reduce the cost of its management structure. As a result, Mike Yonker, executive VP/chief financial officer, will leave at the end of the year and has been replaced by Roger Rowe, formerly VP and corporate controller, who immediately assumed the chief financial officer title.
InFocus said it has eliminated the position of worldwide sales senior VP, held by Scott Hix, who has resigned and will leave at the end of the month.
Instead, three regionally focused sales organizations have been created, each reporting directly to company president/CEO Kyle Ranson.
Steve Stark has been promoted to engineering VP.
John Harker will step down as chairman, effective Sept. 30, but remains a board member, InFocus said.
At the same time, InFocus said it will also simplify its business and reduce operating expenses by between 20 percent and 25 percent from second quarter of 2005 levels with the following actions:
The company said it will cease investment in and marketing of thin-display DLP rear-projection systems, due to pricing pressures in the flat-panel market.
InFocus said it expects to record a third-quarter charge of approximately $8 million related to write-downs of inventory, tooling and manufacturing equipment associated with these products.
Expected is an additional $4 million in inventory charges for the third quarter related to write-downs of other excess inventory and spare parts, remanufactured projectors and identified excess component exposures identified during the contract manufacturing transition from Flextronics.
InFocus said it is “currently evaluating investment in headcount and discretionary program spending in all areas of the company to reduce operating expenses by 20 to 25 percent.”
Staff reductions are expected “over the next few months” with the majority of cuts coming as swiftly as possible, the company said.
“Our performance to date has made it clear that the time for decisive action is now,” Ranson said in a prepared statement. “To return the business to profitability, we must become a more focused company.
“While some of these actions may limit short-term revenue growth opportunities, we must make the changes necessary to have a healthy core business.”
