SAN JOSE, Calif. -- RF-chip maker Anadigics Inc. has implemented cost reduction measures across the company that includes the elimination of about 100 jobs, or about 15 percent of its workforce.
The reduction in workforce is expected to result in pre-tax charges related to severance costs and one-time benefits of approximately $2.2 million to $2.4 million in the fourth quarter of this year, substantially all of which will result in cash expenditures.
The company's goal is to achieve a savings of between $15 million and $20 million on an annual basis starting late in the fourth quarter.
"These cost reduction measures, as we mentioned on our October 22 conference call, align our cost structure with near-term demand while preserving our competitive advantage in technology and product performance," said Gilles Delfassy, chairman and interim chief executive, in a statement.
Amid losses and a fab investment delay in China, Anadigics recently announced the resignation of Bami Bastani, president and chief executive.
Delfassy, who has been a director of the company since January of 2008, will also assume the responsibilities of the CEO until the completion of the company's search for a permanent replacement. Delfassy was a former executive at Texas Instruments Inc.
Amid a lower forecast--and a string of losses--Anadigics recently reported that it will delay the previously announced acceleration of the investment in a wafer fab in Kunshan, China.
Last year, Anadigics (Warren, N.J.) entered into an investment contract under which it would build a new 6-inch, gallium arsenide (GaAs) fab in China. The company and the Kunshan New and Hi-Tech Industrial Development Zone (KSND) plan to jointly construct the fab in the city of Kunshan in the Jiangsu Province in China.
Recently, the RF chip maker reported third quarter 2008 net sales of $58.1 million, a decrease of 27.8 percent compared with net sales of $80.5 million in the prior quarter, and a decrease of 2.4 percent compared to net sales of $59.5 million in the year ago quarter.
Net loss was $15.5 million, or minus $0.26 per share, compared with net income of $6.0 million, or $0.10 per diluted share, in the prior quarter and net income of $2.4 million, or $0.04 per diluted share, in the year ago quarter.
Net sales for the fourth quarter 2008 are estimated to be in the range of $44 million to $46 million. Net sales at this level would represent an approximate 32 percent to 35 percent decrease on a comparable basis with fourth quarter 2007.
Net loss per share on a GAAP basis for the fourth quarter 2008 is expected to approximate $0.19 to $0.21. Pro forma loss per share, excluding non-cash stock compensation expense, is expected to be in the range of approximately $0.12 to $0.14.