WASHINGTON (dpa-AFX) - TranSwitch Corp. (TXCC) announced a business re-organization and restructuring to better align the Company's R&D resources and other operating expenses towards its stated goals.
The company said that it has realigned its R&D resources and organized the Company along two business units: High-Speed Interconnect and Telecom. The company said that certain Executive organizational changes have been implemented.
Michael Macari, formerly VP of Operations and Engineering has resigned from TranSwitch effective October 6, 2011 to pursue other opportunities.
TranSwitch expects that these restructuring actions and other cost reduction initiatives will result in annual savings of approximately $3.6 million and that these savings will begin to be recognized in the fourth quarter of 2011. Of this amount, TranSwitch expects annual savings of approximately $3.2 million in reduced employee related costs including base salary reductions and $0.4 million from other cost savings initiatives.
In connection with the restructuring, TranSwitch expects to incur pre-tax restructuring charges of approximately $0.9 million which will be cash expenditures primarily for employee related costs. The Company expects these charges to be recorded in the third quarter of 2011.
The company also expects its fiscal third quarter 2011 revenue to be in the range of $6.5 million to $7 million compared to the guidance provided on August 8, 2011 of roughly $7 million.
Analysts polled by Thomson Reuters expect the company to report revenues of $7.10 million for the third-quarter. Analysts' estimates typically exclude special items.
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