Presstek To Discontinue Analog Newspaper Plate Business, Sharpens focus on core digital technology
Press release from the issuing company
Jan 3, 2007 -- Presstek, Inc., a leading manufacturer and marketer of high tech digital imaging solutions for the graphic arts and laser imaging markets, today reported that, effective December 29, 2006, it discontinued operations of its Precision Analog plate business which serviced the newspaper industry.
Presstek's President and Chief Executive Officer Edward J. Marino said, "Following the recent chemical incident at our South Hadley facility, production of Precision-branded analog plates was interrupted. Considering the significant interruption in this line of business we had to seriously consider the implications of restarting or discontinuing the operations. As a company we need to focus on advanced business solutions using our digital technology for high quality Commercial Color Print applications. The Precision analog newspaper products and market are not consistent with that strategy and not a meaningful contributor to earnings. As a result we have made the decision to discontinue operations of our Precision Analog plate line and have notified customers that we will help them transition to other vendors. This decision will not affect the production of our digital plate products that are manufactured in a separate but adjacent facility at the South Hadley complex."
Presstek's Executive Vice President and Chief Financial Officer, Moosa E. Moosa said, "The company expects to record one-time charges of approximately $7.14 million related to the discontinued operation in the fourth quarter of 2006. The Precision Analog operation reported revenue of $3.3 million in the quarter-ended September 30, 2006, and $9.9 million in the nine months ended September 30, 2006. Additionally, due to the production interruption, the company expects Precision Analog revenue in Q4 to be below $1 million. In 2007, the company expects a negligible negative impact on earnings as a result of discontinuing these operations due to the small size of the Precision Analog operations and relatively low gross margins and operating income associated with its products."
"This was a difficult decision that leads to the unfortunate loss of jobs at the South Hadley facility, Marino added. "We thank our employees and customers for their support."
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