Wednesday, February 16, 2005

Zarlink Appoints New CEO, Announces Restructuring

Zarlink Semiconductor announced the appointment of Kirk K. Mandy as the company's new President and CEO. Mandy has been associated with Zarlink Semiconductor and Mitel Corporation for 21 years in a variety of increasingly senior positions. He was named Vice President and General Manager of Mitel's Semiconductor division in 1992 and later assumed responsibility for the Business Communications Systems division. Mr. Mandy was CEO of Mitel from 1998 to 2001 and joined the Board as Vice Chairman when Zarlink was formed in 2001.

Zarlink also issued guidance for the Fiscal 2005 fourth quarter ending March 25, 2005. Based on current booking patterns, Zarlink is forecasting that revenues will be between US$47 million and US$49 million in the fourth quarter. In addition, the Company is today announcing cost reductions that are expected to generate annualized savings of US$20 million, the quarterly benefit of which will begin to be realized in the first quarter of Fiscal 2006. Accordingly, Zarlink expects to record additional charges in the fourth quarter of approximately US$18 million or US$0.14 per share, related to reducing its workforce by approximately 15% and stopping certain R&D programs, primarily the development of a digital video decoder. These programs do not involve products currently generating revenue.


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