Sycamore Revises Forecast
Sycamore anticipates that fiscal third-quarter revenue will be in the range of $50 million to $60 million. The Company expects to report a pro forma net loss for the fiscal third quarter, which excludes amortization of deferred stock compensation, payroll taxes on stock option exercises and restructuring charges, in the range of $38 million, or $(0.16) per share, to $45 million, or $(0.19) per share. In addition, due to the uncertainty as to current economic conditions and its impact on capital spending, Sycamore will not be providing guidance for future periods until its third- quarter financial results are released on May 15, 2001.
In the third quarter of fiscal 2000, Sycamore reported pro forma net income of $11.7 million, or $0.05 per share, on revenue of $59.2 million.
Based on its revised guidance, the Company plans to restructure its operations and lower its overall cost structure. As part of these initiatives, Sycamore anticipates recording a non-recurring restructuring charge in the range of $140 million to $150 million associated with the consolidation of the Company's two transport business units into a single entity, delay of facility expansion, inventory and fixed asset write-downs, and the reduction of approximately 140 employees at Sycamore.
"Due to market conditions, it is necessary that the company reduce a portion of its operating expenses," stated Dan Smith, Sycamore's president and chief executive officer. "We are taking the necessary steps to improve our operating performance by focusing on key projects for our customers while taking a prudent approach to managing our cost structure. We believe that this approach will allow us to immediately capitalize on new opportunities as market conditions improve."