RF Micro Devices (RFMD) Press Release 12-17-2008
RFMD®Announces Actions to Reduce Manufacturing
and Increase Cash Flow
Dec. 17 /PRNewswire-FirstCall/ --RF Micro
Devices, Inc. (Nasdaq: RFMD), a global leader in the design
and manufacture of high-performance semiconductor components, today
announced actions intended to streamline operations and reduce GaAs
semiconductor manufacturing costs. RFMD(R) expects the actions will
begin to take effect in the
March 2009 quarter and will positively impact cash flow
in RFMD's fiscal 2010, beginning
March 29, 2009.
At RFMD's Greensboro, NC
campus, all GaAs manufacturing will be transitioned to the Company's
state-of-the-art 6-inch wafer fabrication facility. The Company's 4-inch
manufacturing facility will be idled and kept in a clean environment.
Prior to this decision, RFMD's 4-inch manufacturing facility accounted
for less than 10% of the Company's total GaAs manufacturing capacity.
As a result, the Company anticipates significantly lower direct material
costs and higher utilization rates, resulting in lower total manufacturing
In addition, in November RFMD(R) began significantly reducing
its 6-inch wafer production and associated costs in its United
wafer fabrication facility. The Company will operate the facility
on 8-hour shifts, 5 days a week, as compared to the 24/7 environment
in which the facility currently operates.
Bob Bruggeworth, President
and CEO of RFMD, said, "RFMD is taking prudent and decisive actions
to match manufacturing capacity to anticipated demand during the current
recessionary environment. By reducing RFMD's manufacturing cost structure,
these actions are expected to positively impact cash flow by approximately
$15 million in fiscal 2010. Because existing facilities will
be reduced or idled, RFMD will retain the capacity and flexibility necessary
to respond to increases in customer demand as the recession wanes and
as the Company's markets return to growth."
RFMD estimates approximately
250 employees, or approximately 5% of its global workforce, will have
been affected by these actions between
and March 2009.
About RFMD: RF Micro
Devices, Inc. (Nasdaq GS: RFMD) is a global leader in the
design and manufacture of high-performance semiconductor components.
RFMD's products enable worldwide mobility, provide enhanced connectivity
and support advanced functionality in the cellular handset, wireless
infrastructure, wireless local area network (WLAN), CATV/broadband and
aerospace and defense markets. RFMD is recognized for its diverse portfolio
of semiconductor technologies and RF systems expertise and is a preferred
supplier to the world's leading mobile device, customer premises and
communications equipment providers.
Greensboro, N.C., RFMD is an ISO 9001- and ISO 14001-certified
manufacturer with worldwide engineering, design, sales and service facilities.
RFMD is traded on the NASDAQ Global Select Market under the symbol RFMD.
For more information, please visit RFMD's web site at
This press release includes "forward-looking statements" within
the meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements include,
but are not limited to, statements about our plans, objectives, representations
and contentions and are not historical facts and typically are identified
by use of terms such as "may," "will," "should," "could," "expect,"
"plan," "anticipate," "believe," "estimate," "predict," "potential,"
"continue" and similar words, although some forward-looking statements
are expressed differently. You should be aware that the forward-looking
statements included herein represent management's current judgment and
expectations, but our actual results, events and performance could differ
materially from those expressed or implied by forward-looking statements.
We do not intend to update any of these forward-looking statements or
publicly announce the results of any revisions to these forward-looking
statements, other than as is required under the federal securities laws.
RF Micro Devices'
business is subject to numerous risks and uncertainties, including variability
in quarterly operating results, the impact of global macroeconomic and
credit conditions on our business, the rate of growth and development
of wireless markets, risks associated with our planned exit from our
wireless systems business, including cellular transceivers and GPS solutions,
the risk that restructuring charges may be greater than originally anticipated
and that the cost savings and other benefits from the restructuring
may not be achieved, risks associated with the operation of our wafer
fabrication facilities, molecular beam epitaxy facility, assembly facility
and test and tape and reel facilities, our ability to complete acquisitions
and integrate acquired companies, including the risk that we may not
realize expected synergies from our business combinations, our ability
to attract and retain skilled personnel and develop leaders, variability
in production yields, our ability to reduce costs and improve gross
margins by implementing innovative technologies, our ability to bring
new products to market, our ability to adjust production capacity in
a timely fashion in response to changes in demand for our products,
dependence on a limited number of customers, and dependence on third
parties. These and other risks and uncertainties, which are described
in more detail in RF Micro Devices'
most recent Annual Report on Form 10-K and other reports filed with
Securities and Exchange Commission, could cause actual results
and developments to be materially different from those expressed or
implied by any of these forward-looking statements.
DEVICES(R) and RFMD(R) are trademarks of RFMD, LLC. All other
trade names, trademarks and registered trademarks are the property of
their respective owners.
SOURCE RF Micro Devices, Inc. 11/12/2008
Dean Priddy, CFO, 1-336-678-7975, or Doug DeLieto, VP,
Investor Relations, 1-336-678-7968, or Jerry Neal EVP, Marketing and
Strategic Development, 1-336-678-7001, all of RFMD