CSR To End Investment In COACH Platform; Sees Reduction In COACH Workforce

(RTTNews) - CSR plc (CSR.L, CSRE, CSRXF.PK) said it would discontinue development of its camera-on-a-chip or COACH platform, to enhance its focus of investment into potential areas of future growth. CSR would continue to develop Imaging intellectual property or IP for future markets such as automotive and wearables, and would also increase investment in the growing areas of Bluetooth Smart and Voice & Music. The company would continue to support customers who implement the current generation of COACH.

Joep van Beurden, CEO of CSR stated: "We continue to take a disciplined approach to capital allocation and cost control and have decided to withdraw investment from the COACH platform due to weakness in the digital still camera market. The prospects for growth in the five end markets in our Core business group - Auto, Imaging, Voice & Music and the two nascent markets of Bluetooth Smart and Indoor Location - are strong. Given the opportunities we see ahead of us, we will continue to develop Imaging IP for future markets and redeploy some people from Imaging into our strongly growing areas of Voice & Music and Bluetooth Smart. He added, "The actions we have announced today will allow us to increase investment in the areas that offer the best prospects for delivering sustained, profitable growth and we expect to reach our previously stated target of mid-teens underlying operating profit margin on a quarterly run-rate by the end of 2014."

Therefore, CSR expects to realise about $30 million of underlying operating cost reductions in 2014; and anticipates nearly $15 million of restructuring costs during 2013 and 2014. CSR does not anticipate a material impact on revenue for 2013 as a result of the actions announced today and expects 2014 revenue be reduced by some $20 million versus its prior view.

It is anticipated that there would be an impairment charge in its 2013 fiscal year of around $90 million resulting from these actions. In addition, CSR sees a reduction in the COACH workforce of around 200 roles by the end of the second quarter 2014.