Calgary-based Wi-LAN Inc. says it will slash its workforce by one-third and take other money-saving measures to cope with slower-than-expected growth in the fixed wireless access market.
The wireless equipment developer announced Tuesday it will save about $1.5-million a month to its cash flow with the widespread restructuring plan, which will also include cutting executive salaries by one-third.
“We have three challenges: to live within our cash resources, to maintain the growth of our revenue and market share and to maintain the market leadership of our broadband wireless access products and the potential of our W-OFDM technology,” chairman and CEO Hatim Zaghloul said in a news release.
“We believe that these changes will allow us to overcome these three challenges.”
The company said its staff of 280 will be cut by 30 per cent and expenditures will also be slashed. The restructuring plan will cost about $1 million.
“The bulk of our investment to date has positioned Wi-LAN as the leader in the fixed wireless access market,” said president Bill Hews. “Going forward, sales channel development, product completion and cost reduction will be based on solid market demand.”
Earlier this month, Wi-LAN increased its broadband wireless revenue guidance for the three months ended July 31, 2001 to between $7 million and $9 million from the $6 million to $9 million announced in May 2001. Unaudited broadband wireless sales totalled $5.2 million in May and June, the first two months of the third quarter.
“Our broadband wireless sales in the first two months of this quarter almost equalled our broadband wireless sales in the previous quarter, allowing us to project continued quarter-over-quarter growth," said CFO Peter Kinash.
“This restructuring plan will allow us to significantly reduce our spending and accelerate our goal of being cash flow positive while continuing to improve our market position.”
Web Watch:
www.wi-lan.com
