Beaverton, OR — In its earnings release on April 29, Planar Systems Inc. reported “historically softer” second-quarter performance from its Home Theater Business Unit (HTBU), which includes the Runco and Vidikron brands. In addition, Planar president and CEO Gerry Perkel has assumed the role of HTBU general manager, replacing Scott Hix, who has left the company.
In a followup statement, Perkel explained that Planar made its decision to consolidate management in an effort to reduce costs following a combination of slow HTBU sales, U.S. economic woes, and corporate “integration” challenges following its recent acquisitions. He also complimented Hix on his service with the company.
“I want to thank Scott for his tremendous efforts in both launching the home theater business at Planar and his hard work in the acquisition of Runco,” Perkel stated. “I respect what Scott has accomplished in this industry, and we are parting on friendly terms. I wish him well in all future endeavors.”
According to the company’s second-quarter earnings release, Planar’s HTBU did not achieve expected financial performance after its May 2007 Runco acquisition, partially due to integration challenges between the two companies and partially due to the impact on the market of the U.S. economic slowdown. As a result, the company will implement “changes to enhance the experience of its customers and improve the financial performance of the business,” according to the release.
Planar launched a new strategic direction almost two years ago, with the goal of transforming into a larger and more profitable specialty display provider. To achieve that goal, the company undertook a number of growth initiatives including investing in some of its legacy specialties businesses, launching new organic growth initiatives, and gaining entry into complementary specialty display markets as well as product expertise via two strategic acquisitions. According to the release, “the company believes it has allowed sufficient time for these initiatives to show their merit and the result is that some have been successful and some have not.”
Planar is entering the next phase of its strategy to focus on initiatives that are performing well and fixing those that are underperforming. The overall goal of this next phase is to improve profitability at a faster rate, increase cash flow and improve liquidity, and ultimately enhance shareholder value.
