Ceragon Announces Headcount Reduction - Quick Facts

(RTTNews) - Ceragon Networks Ltd. (CRNT) announced an immediate headcount reduction of approximately 14% to reduce the company's operating expenses. The company anticipates that the expense reduction initiative will be substantially complete by the end of 2014 and expects to record a charge of approximately $10-$12 million in the fourth quarter, of which approximately $5-$6 million will be cash, primarily related to severance, which will be paid mainly during the first quarter of 2015. Ceragon plans to reach profitability in the second quarter of 2015.

Ira Palti, CEO of Ceragon, said: "We are making difficult but necessary changes at the operational level to further streamline the management organization, prioritize R&D projects, and improve product cost in order to further improve our competitive position. When fully reflected in our financial results in the second quarter of 2015, we expect to reduce quarterly operating expenses to approximately $21-$22 million from the current level of $26 to $27 million. "

The company also announced that, in the fourth quarter of 2014, it expects to record additional financial expense in the amount of approximately $19 million, reflecting a re-measurement charge related to certain assets in Venezuela at current book value of approximately $20 million, primarily accounts receivable, denominated in or linked to the U.S. dollar, due to the continued Venezuelan government policy that limits its customers' ability to pay such receivables in U.S. dollars.