CSR to discontinue investment in digital TV SoCs and silicon tuners

Monday, December 12th, 2011 
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CSR increases focus on market-leading platforms discontinuing investment in digital television SoCs and silicon tuners

CAMBRIDGE, UK — CSR plc. (LSE: CSR and NASDAQ: CSRE) today announced that it will be discontinuing investment in the areas of digital television systems-on-a-chip (DTV SoC) and silicon tuners, in order to increase its focus on areas of business where it has leadership positions and the ability to deliver differentiated platforms and products.

CSR expects to realise, on an annualized basis, $60m of operating cost reductions as a result of these changes and other efficiency savings, and to incur an incremental $10m of restructuring costs by the end of the second quarter of 2012. The company will continue to support and deliver products to customers in these areas, and will continue to develop connectivity, other home entertainment products and peripherals related to the DTV market. It does not expect a material impact on revenues for 2012 as a result of the actions announced today.

The cost reductions expected as a result of this and other efficiency measures are in addition to previously announced synergy and rightsizing savings of $55m arising from the Zoran transaction, and the expected $15m reduction in cost of goods, which are on track to be achieved by the end of the first quarter 2012. CSR therefore currently expects underlying operating costs, excluding all one-off restructuring charges, to be in the range of $420m to $430m on an annualized basis during the second half of 2012, with full year 2012 underlying operating costs of $430m to $440m.

Joep van Beurden, CEO of CSR said, “We continue to take a disciplined approach to capital allocation and cost control. We have decided to withdraw investment from the DTV SoC and silicon tuner businesses and are focusing our investment where we have a strong position in platforms in the areas of voice & music, automotive infotainment, cameras, document imaging, gaming and Bluetooth low energy.

“We will also continue to invest in a range of products for attractive growth markets including handsets and computer peripherals.

“The actions we have announced today will allow us to increase our focus on the areas of the business that offer the best prospects for delivering sustained and profitable growth.”

The company expects to have around 2,400 personnel worldwide at the end of the second quarter 2012 and had around 3,200 personnel at the end of September 2011.

CSR continues to expect fourth quarter 2011 revenues to be in line with previous guidance, in the range of $230m to $250m.