29th Jun 2006 07:01
Spirent Communications PLC29 June 2006 SPIRENT COMMUNICATIONS PLC RESTRUCTURING ACTIONS London, UK - 29 June 2006: Following the trading update on 14 June 2006, SpirentCommunications plc ("Spirent") (LSE: SPT; NYSE: SPM), a leading communicationstechnology company, is today reporting the following restructuring actions inits Communications businesses. As previously stated, the Company is managing significant product transition inthe current year: • within the Performance Analysis Broadband division, as sales of older platforms decrease and are replaced by the sales of new products; and • within the Service Assurance division, as legacy product revenues continue to decline, whilst investment is being made in new monitoring solutions for voice, video and data networks. During this transition phase we said that we would continue to carefully managethe balance between the cost base and maintaining the capability to generatelong term growth. Accordingly, we are implementing restructuring actions in the PerformanceAnalysis and Service Assurance divisions to realign resources and reduceoperating expenses. The major part of these actions will take place in theService Assurance division, which will enable it to maintain a near break-evenresult for the second half of 2006 (following the cost reductions outlinedbelow, pro forma break-even sales for Service Assurance are estimated to be £36million per year). The total annualised cost reduction will be approximately £9.0 million per year.The cost of these actions is a one-time charge of £5.0 million of which £4.0million will be in cash, to be expensed and reported in our forthcoming interimresults on 10 August 2006. Anders Gustafsson, Chief Executive of Spirent, commenting on the actions, said: "The main consideration behind these restructuring actions is to ensure that ourresources are allocated appropriately to develop our enhanced products. Thiswill ensure that we can offer the platforms required by network equipmentmanufacturers for the development of their own products, and by serviceproviders for the deployment of their next-generation networks." - ends -Enquiries Spirent Communications plc +44 (0)1293 767676Anders Gustafsson, Chief Executive Eric Hutchinson, Chief Financial Officer Smithfield +44 (0)20 7360 4900 Reg Hoare/Katie Hunt/Libby Young About Spirent Communications plc Spirent Communications plc is a leading communications technology companyfocused on delivering innovative systems and services to meet the needs ofcustomers worldwide. We are a global provider of performance analysis andservice assurance solutions that enable the development and deployment ofnext-generation networking technologies such as broadband services, Internettelephony, 3G wireless and web applications and security testing. The Systemsgroup develops power control systems for specialist electrical vehicles in themobility and industrial markets. Further information about SpirentCommunications plc can be found at www.spirent.com. Spirent Communications plc Ordinary shares are traded on the London StockExchange (ticker: SPT) and on the New York Stock Exchange (ticker: SPM; CUSIPnumber: 84856M209) in the form of American Depositary Shares ("ADS"),represented by American Depositary Receipts, with one ADS representing fourOrdinary shares. Spirent and the Spirent logo are trademarks or registered trademarks of SpirentCommunications plc. All other trademarks or registered trademarks mentionedherein are held by their respective companies. All rights reserved. This press release may contain forward-looking statements that are based oncurrent expectations or beliefs, as well as assumptions about future events. Bytheir nature, forward-looking statements are inherently predictive, speculativeand involve risk and uncertainty because they relate to events and depend oncircumstances that will occur in the future. You should not place undue relianceon these forward-looking statements, which are not a guarantee of futureperformance and are subject to factors that could cause our actual results todiffer materially from those expressed or implied by these statements. Theserisks include the risks described from time to time in Spirent Communicationsplc's Securities and Exchange Commission periodic reports and filings. TheCompany undertakes no obligation to update any forward-looking statementscontained in this press release, whether as a result of new information, futureevents or otherwise. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Spirent