Elantec Revises Estimates for Third Quarter Fiscal 2001; Company Announces Plans to Reduce Cost Structure.Business Editors MILPITAS, Calif.--(BUSINESS WIRE)--June 5, 2001 Elantec Semiconductor, Inc. (Nasdaq:ELNT), a leader in high performance analog integrated circuits Integrated circuits Miniature electronic circuits produced within and upon a single semiconductor crystal, usually silicon. Integrated circuits range in complexity from simple logic circuits and amplifiers, about 1/20 in. (1. , today announced that revenue for the Company's third quarter of fiscal 2001 will be down approximately 30 to 35 percent sequentially from the Company's second quarter revenue of $30.6 million. The revenue decline from earlier estimates is primarily attributable to continued softness in its communications business. The softness in its communications business has led to a significant reduction in the demand on its internal fab, sort, and test operations. As a result the Company has announced a reduction in its workforce of approximately 15%. The Company's pre-action headcount is approximately 375 employees. The reduction in force will be primarily focused on 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. in Milpitas, California Milpitas (IPA pronunciation: mɪlpitʌs; inhabitants are called 'Milpitans') is a city in Santa Clara County, California. It is located with San Jose to its south and Fremont to its north, at the eastern end of Highway 237 and generally between Interstate freeways 680 and . In addition to the announced reduction in force, the Company will be shutting down its manufacturing operations for 2 weeks in July. Non-operational employees are also being encouraged to take 10 days off during the quarter. Earnings based on the revised revenue guidance is expected to be between $.06 and $.08 per share for the quarter before the effects of one-time charges associated with the Company's cost reduction plans. Gross margins are expected to be between 51% and 52% before one-time charges. The one-time charges of approximately $2.9 million, to be taken during the third fiscal quarter, will cover severance expenses, obsolete/excess inventory, and equipment write-offs. The expected savings associated with the reduction in force and assets write-offs are approximately $800 thousand per quarter. The 2 weeks shutdown shut·down n. A cessation of operations or activity, as at a factory. shutdown Noun the closing of a factory, shop, or other business Verb shut down and vacations should save the Company approximately $400 thousand during the fourth fiscal quarter. "Although we have been encouraged with positive signs in our video and optical storage businesses, the continued softness and lack of visibility in communications, and xDSL in particular, has led us to take stronger actions to manage our costs and inventories. We remain positive on the long-term prospects of our DSL DSL in full Digital Subscriber Line Broadband digital communications connection that operates over standard copper telephone wires. It requires a DSL modem, which splits transmissions into two frequency bands: the lower frequencies for voice (ordinary business, but, due to the severity of the current slowdown across the communications sector, we feel it is imperative to reduce our manufacturing capacity," said Rich Beyer, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "These steps will enable us to align align (  līn),v to move the teeth into their proper positions to conform to the line of occlusion. our costs to the realities of the current situation. We will remain well positioned to satisfy demand when our communications business returns to growth." The Company said that new products remain its key focus and that it continues to fund its marketing and development to steadily increase the flow of new products. Its efforts in this area remain solidly on track for this year. Web Broadcast and Instant Replay Elantec will broadcast a conference call today at 6:00 a.m. PST PST Paroxysmal supraventricular tachycardia, see there . This event is available through the Company's website located at http://www.elantec.com. For those unable to attend the live broadcast, a 5-day broadcast replay will be available shortly after the event. Elantec is also making available a 5-day telephone replay of the conference call which can be accessed by dialing 1-800-405-2236 and entering pass code number 349340. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement This press release contains forward looking statements, including future financial performance projections, statements about expected market conditions and management's plans and objectives, such as those statements related to the Company's expected revenue, gross margin, earnings and cost savings during the Company's third fiscal quarter. These 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. involve risks and uncertainties that could cause the Company's actual results to differ materially from those projected in this press release. These risks and uncertainties include competitive pricing pressures, fluctuations in manufacturing yield, continued softness in the communications sector, lack of growth in demand for PCs, an increase in customer cancellations, business and economic conditions in various geographic regions, change in customer order patterns, litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. involving intellectual property and other issues, and other risk factors discussed from time to time in the Company's reports filed with the Securities and Exchange Commission, including but not limited to the Company's most recent Forms 10-Q and 10-K. The Company's actual future results could differ materially from those discussed here. About Elantec Semiconductor Elantec designs, manufactures and markets high performance analog integrated circuits primarily for the video, optical storage, communication, and power management markets. The Company targets high growth commercial markets in which advances in digital 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 technology are driving increasing demand for high speed, high performance and low power consumption analog circuits analog circuit, electronic circuit that operates with currents and voltages that vary continuously with time and have no abrupt transitions between levels. Generally speaking, analog circuits are contrasted with digital circuits, which function as though currents or . |
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