Aeroflex Incorporated Announces Strategic Consolidation of Certain of Its Manufacturing Operations.Business Editors Aeroflex Incorporated (Nasdaq Symbol: ARXX) Company Expects to Save in the Range of $5.0 to $5.5 Million in Annual Operating Expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. Aeroflex Incorporated (Nasdaq Symbol: ARXX), a leading designer, developer and manufacturer of microelectronics and automated testing (testing) automated testing - Software testing assisted with software tools that require no operator input, analysis, or evaluation. solutions for the fiber optic and wireless communications wireless communications System using radio-frequency, infrared, microwave, or other types of electromagnetic or acoustic waves in place of wires, cables, or fibre optics to transmit signals or data. markets, announced today its strategic plans to consolidate three of its manufacturing operations Manufacturing operations concern the operation of a facility, as opposed to maintenance, supply and distribution, health, and safety, emergency response, human resources, security, information technology and other infrastructural support organizations. to take advantage of excess manufacturing capacity and reduce operating costs operating costs npl → gastos mpl operacionales . The Company will also record fourth quarter charges to eliminate excess equipment capacity, primarily in its microelectronics division, and for the impairments to goodwill and other intangibles related to its TriLink and Amplicomm fiber optic acquisitions. In connection with its recently completed acquisition of IFR IFR abbr. instrument flight rules Systems, Inc., the operations of Aeroflex's RDL RDL - Requirements and Development Language. ["RDL: A Language for Software Development", H.C. Heacox, SIGPLAN Notices 14(9):71-79 (Sep 1979)]. subsidiary will be folded into IFR's U.K. operations and Aeroflex's Plainview, NY facility. The costs associated with these actions and other workforce reductions in Aeroflex's Test Solutions Division, are expected to total approximately $2.3 million. These costs include severance costs and the write down of RDL's owned facility to net realizable value Net realizable value (NRV) is a commonly used method of evaluating an asset's worth in the field of inventory accounting. NRV is part of GAAP rules that apply to valuing inventory, so as to not overstate or understate the value of inventory goods. . The cash costs associated with these restructurings are anticipated to be approximately $1.5 million. The moves are expected to be completed by March 2003. In addition, Aeroflex's Microelectronic Solutions Division will consolidate the operations of its Amplicomm fiber optic modulator Modulator Any device or circuit by means of which a desired signal is impressed upon a higher-frequency periodic wave known as a carrier. The process is called modulation. The modulator may vary the amplitude, frequency, or phase of the carrier. driver subsidiary into its Plainview, NY facility and its TriLink fiber optic modulator subsidiary into its Colorado Springs Colorado Springs, city (1990 pop. 281,140), seat of El Paso co., central Colo., on Monument and Fountain creeks, at the foot of Pikes Peak; inc. 1886. It is a year-round resort and a booming military, technological, and commercial city. , CO facility. The cost of these moves, which include the write down of excess production equipment (including excess production equipment at its Plainview, NY facility), lease buyouts and severance costs, are expected to be approximately $2.4 million. The Company will also record fourth quarter impairment charges for goodwill and other acquisition related intangibles of approximately $11 million. The cash costs associated with these actions are anticipated to be approximately $1.1 million and the moves are expected to be completed by November 2002. Upon completion of these actions, it is expected that the annual operating expense Operating Expense The essential things that a company must purchase in order to maintain business. Notes: For example, the payment of employees wages are an operating expense. Also known as OPEX. savings will be in the range of $5.0 to $5.5 million, of which $3.5 to $4.0 million will be cash. "Given the significant reduction in global spending for fiber optic components, as well as our excess manufacturing capacity, these strategic consolidations are expected to reduce ongoing operating costs and improve our competitive position to take advantage of the future recovery in our end markets," said Michael Gorin, President. "The impairment charge for intangibles associated with the acquisitions of TriLink and Amplicomm reflects the reduced overall market for discrete modulators and modulator drivers as well as the continuing price erosion for these devices. The RDL restructuring is one aspect of our ongoing integration plan with IFR, which is expected to result in additional sales and operating expense synergies. "In connection with the acquisition of IFR, we have undertaken a study to allocate the purchase price of IFR to its assets and liabilities including intangible assets. Any allocation to purchased in-process research and development costs will be written off in our fourth quarter." About Aeroflex Aeroflex Incorporated, through its subsidiaries, designs, develops and manufactures state-of-the-art microelectronic module, integrated circuit integrated circuit (IC), electronic circuit built on a semiconductor substrate, usually one of single-crystal silicon. The circuit, often called a chip, is packaged in a hermetically sealed case or a nonhermetic plastic capsule, with leads extending from it for , interconnect and testing solutions used in broadband communication applications. The Company's common stock trades on the Nasdaq National Market System under the symbol ARXX and is included in the S&P SmallCap 600 index. Additional information concerning Aeroflex Incorporated can be found on the Company's Web site: www.aeroflex.com. All statements other than statements of historical fact included in this press release regarding Aeroflex's financial position, business outlook, business strategy and plans and objectives of its management for future operations are forward-looking statements. When used in this press release, words such as "anticipate," "believe," "estimate," "expect," "intend" and similar expressions, as they relate to Aeroflex or its management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of Aeroflex's management, as well as assumptions made by and information currently available to its management. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors, including but not limited to, competitive factors and pricing pressures, integration of the business of IFR, the successful consolidation of the operations of RDL, Amplicomm and TriLink, changes in legal and regulatory requirements, technological change or difficulties, product development risks, commercialization difficulties and general economic conditions. Such statements reflect our current views with respect to the future and are subject to these and other risks, uncertainties and assumptions relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc Aeroflex's financial condition, results of operations, growth strategy and liquidity. |
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