Presstek Implements Repositioning, Realigns Business Units, Reduces Staff
Press release from the issuing company
Senior Management Takes Action After Completing Business Reviews
HUDSON, N.H., June 7 -- Presstek, Inc., a leading provider of direct digital imaging technology, announced today that its new senior management team has completed its business review and has begun the implementation of its strategic repositioning plans. These repositioning actions are expected to more closely align the company with its Direct Imaging (DI) and computer-to-plate (CTP) markets and partners. Presstek's Lasertel subsidiary is largely unaffected by these changes and will continue to supply Presstek with its state-of-the-art laser diodes for its imaging systems.
"Upon my appointment as CEO, I initiated detailed reviews of all the elements of our business. These reviews are now complete and the necessary actions are underway to solidify our leading position in the DI market and to improve future earnings growth," said Edward J. Marino, president and chief executive officer of Presstek. "The refocusing of our business on the marketing and commercialization of our DI-enabling technology will allow us to take advantage of the growth opportunities available in the marketplace today and position us well for the future."
The first part of the market-focused repositioning includes the following:
* New senior management organization;
* Re-alignment to market-focused DI and CTP business units with full P&L responsibility and shared central functions;
* Re-alignment of personnel, including the termination of approximately 20% of Presstek employees; and
* Consolidation and integration of the company's Hampshire Drive research & development facility into the company's main Executive Drive operations in Hudson, NH.
As a result of the above, Presstek expects to incur one-time charges in the second quarter of this year of approximately $4.6 million related to these activities. The cash portion of these charges is expected to approximate $1.7 million. Capital expenditures and moving costs related to the Hampshire Drive consolidation are expected to be minimal. The associated annualized cost savings are expected to be approximately $5.6 million.
The second part of the plan is a streamlining and prioritization of company resources to focus on the most promising and profitable opportunities. This will result in the discontinuance of certain programs. Accordingly, reserves for asset write-offs and accruals amounting to approximately $5.0 million will be booked in the current quarter.
The majority of the repositioning is expected to be fully implemented by June 30, 2002. We expect the facility consolidation to be completed in the third quarter of this year.
"Presstek has a solid business and a bright future," Marino said. "These changes will provide a strong market focus in the organization to better capitalize on its wealth of technologies. We expect to add further sales and marketing personnel as we strengthen our marketing channels. This investment will support the company's growth.
Marino continued, "The repositioning plan implemented today, together with the restructuring completed earlier in 2002, is expected to result in a significant streamlining of our organization, its resources and operations, and is expected to produce an aggregate annualized cost savings of approximately $8.2 million going forward."
Presstek, Inc. is a leading developer of digital laser imaging and chemistry-free plate technologies for the printing and graphic arts industries. Marketed to world-leading press manufacturers and directly to end users, Presstek's patented DI, CTP and plate products eliminate photographic darkrooms, film and toxic processing chemicals, reduce the printing turnaround time and lower the production costs. The company's Lasertel subsidiary supplies it with the valuable resources necessary for its next generation laser imaging devices.
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