CIENA To Consolidate Facilities; Announces Planned Actions Toward Goal of 10-20% Operating Expense Reductions.Business Editors/High-Tech Writers LINTHICUM, Md.--(BUSINESS WIRE)--April 20, 2004 CIENA(R) Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :CIEN CIEN Ciena Corporation (stock symbol) ), a leading global provider of innovative networking solutions, today announced plans to consolidate facilities as part of its actions to achieve its previously stated goal of reducing ongoing 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. by 10 to 20 percent in fiscal year 2004. The Company intends to close its San Jose San Jose, city, United States San Jose (sănəzā`, săn hōzā`), city (1990 pop. 782,248), seat of Santa Clara co., W central Calif.; founded 1777, inc. 1850. , Calif. facility on September 30, 2004. The San Jose closing, and related actions, are expected to affect approximately 425 employees, or approximately 25 percent, of CIENA's current workforce by the end of the fiscal year. All ongoing product development and customer support activities currently based in San Jose will be consolidated on a product group or functional basis with efforts in progress at other CIENA locations. For instance, San Jose-based CoreDirector(TM)-related development will be consolidated with CIENA's ongoing CoreDirector development already taking place in Alpharetta, Ga. and in Linthicum, Md.; ONLINE(TM)-related development will be consolidated with ONLINE activities underway in Research Triangle Park Research Triangle Park, research, business, medical, and educational complex situated in central North Carolina. It has an area of 6,900 acres (2,795 hectares) and is 8 × 2 mi (13 × 3 km) in size. Named for the triangle formed by Duke Univ. , N.C. CIENA also operates development centers in Acton, Mass. and Kanata, Ontario Kanata is a large suburban area in the western part of Ottawa, Ontario, Canada,it has a population of 90,000 and is growing rapidly. It is located just to the west of the Greenbelt and is one of the largest of several communities that surround central Ottawa. . The planned actions will occur over the course of the next several fiscal quarters and are expected to have minimal effect on current product development efforts. "The decision to close a facility is especially difficult because it affects not only employees and their families, but the surrounding community as well," said Gary Smith Gary Smith may refer to:
CIENA estimates that the actions announced today will enable the Company to meet its previously announced objective of lowering ongoing operating expenses by 10 to 20 percent during this fiscal year by generating between $60 to $70 million in annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. cost savings, including approximately $55 to $65 million at the ongoing 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. level, prior to restructuring-related or other non-operating charges. CIENA expects that the majority of the cost savings will be in place by the end of its fourth fiscal quarter, 2004. The Company expects to record total restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. of between $75 to $85 million associated with these actions. The timing of the restructuring charges will correspond to the timing of specific actions and will likely occur over the next several fiscal quarters. Today's announced reductions and associated restructuring charges are unrelated to and will not affect CIENA's planned acquisitions of Catena ca·te·na n. pl. ca·te·nae or ca·te·nas A closely linked series, especially of excerpted writings or commentaries. [Latin cat Networks, Inc. and Internet Photonics, Inc., both of which are expected to close by the end of CIENA's third fiscal quarter. ABOUT CIENA CIENA Corporation Ciena Corporation NASDAQ: CIEN develops and markets communications network platforms and software, and offers professional services. The Company's broadband access, data and optical networking platforms, software tools, and global network services support worldwide telecom delivers innovative network solutions to the world's largest service providers and enterprises, increasing the cost-efficiency of current services while enabling the creation of new carrier-class data services built upon the existing network infrastructure. Additional information about CIENA can be found at www.ciena.com. NOTE TO INVESTORS This press release contains certain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. based on current expectations, forecasts and assumptions of CIENA (the Company) that involve risks and uncertainties. Forward-looking statements in this release, including but not limited to the Company intends to close its San Jose, Calif. facility on September 30, 2004, the San Jose closing, and related actions, are expected to affect approximately 425 employees, or approximately 25 percent, of CIENA's current workforce by the end of the fiscal year, the planned actions will occur over the course of the next several fiscal quarters and are expected to have minimal effect on current product development efforts, CIENA estimates that the actions announced today will enable the Company to meet its previously announced objective of lowering ongoing operating expenses by 10 to 20 percent during this fiscal year by generating between $60 to $70 million in annualized cost savings, including approximately $55 to $65 million at the ongoing operating expense level, prior to restructuring-related or other non-operating charges, CIENA expects that the majority of the cost savings will be in place by the end of its fourth fiscal quarter, 2004, the Company expects to record total restructuring charges of between $75 to $85 million associated with these actions, the timing of the restructuring charges will correspond to the timing of specific actions and will likely occur over the next several fiscal quarters, and today's announced reductions and associated restructuring charges are unrelated to and will not affect CIENA's planned acquisitions of Catena Networks, Inc. and Internet Photonics, Inc. both of which are expected to close by the end of CIENA's third fiscal quarter, are based on information available to the Company as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" . The Company's actual results could differ materially from those stated or implied in such forward-looking statements, due to risks and uncertainties associated with the Company's business, which include the risk factors disclosed in the Company's Report on Form 10-Q Form 10-Q See 10-Q. filed with the Securities and Exchange Commission on February 19, 2004. Forward-looking statements include statements regarding the Company's expectations, beliefs, intentions or strategies regarding the future and can be identified by forward-looking words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "should," "will," and "would" or similar words. The Company assumes no obligation to update the information included in this press release, whether as a result of new information, future events or otherwise. |
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