(been too busy to post. if previously posted, my apologies)
Xpedior Announces Action Plan to Achieve Positive
EBITDA
Business Editors
CHICAGO--(BUSINESS WIRE)--Sept. 26, 2000--
STEPS INCLUDE A 16% REDUCTION IN FORCE; KEY MANAGEMENT
CHANGES; APPOINTMENT OF A NEW SENIOR VP OF SALES; AND
CONSOLIDATION OF SEVEN US
REGIONS INTO TWO OPERATING UNITS
Xpedior Incorporated (NASDAQ: XPDR) today announced it is implementing
an action plan to resume sequential revenue growth and become EBITDA (a)
positive as early as the fourth quarter of 2000. The plan calls for an immediate
16% reduction in force. The reduction affects approximately 270 of Xpedior's
1700 employees and is intended to dramatically improve the Company's
utilization rate and gross margins, which were affected by the decline in
third-quarter revenue. In conjunction with the reduction in force, Xpedior will be
taking a one-time charge against earnings in the third quarter.
Other actions announced today by the company included key management
changes, the appointment of a new Senior VP of Sales, and the consolidation
of seven domestic regions into two operating units covering the Eastern and
Western sections of the United States.
"As you know, our industry has struggled through a very difficult third quarter,"
David Campbell, Xpedior's CEO said. "Earlier, like a number of other
companies in the sector, we announced that we would miss our projections for
third-quarter revenue," Campbell explained.
"Demand for enterprise wide e-Business solutions remains strong; however
these projects are becoming larger, more complex and ROI-driven among the
Global 2000 customers as well as the emerging digital market. We are
confident the changes announced today best position Xpedior to resume
sequential revenue growth and achieve positive EBITDA," Campbell said.
Xpedior's other announced actions also reflect its intent to streamline
operations. As part of the Company's succession planning, CEO Campbell
now assumes the role of Chairman of its Board of Directors. Brian Farrar
becomes President as well as COO. James W. Crownover, who served as the
Company's non-Executive Board Chairman, now becomes Vice Chairman.
According to Farrar, "Our most immediate priority is to implement the
infrastructure needed to grow the business profitably and to deliver the
increasingly complex e-Business solutions required by clients worldwide. We
are committed to remaining a major e-Business solutions pure play."
To accelerate this effort, Xpedior today also named Cindy Pogrund President
of U.S. Operations, reporting to Farrar. Ms. Pogrund will be responsible for
integrating Xpedior's seven domestic regions into two operating units.
Executive Vice President Vincent Verna will manage Xpedior's regional
operations in the Western United States, while Executive Vice President Mark
Hansen will assume responsibility for the Eastern half of the nation.
Rob McGill also was named today by the Company as President of
International Operations, reporting to Farrar. In addition to continuing to grow
Xpedior's international presence, McGill will also manage Xpedior's Global
Strategy Group.
Previously, Pogrund was Senior Vice President of Xpedior's Midwest Region;
Verna, Senior Vice President, Mid-Atlantic Region; Hansen, Senior Vice
President, Global Services; and McGill, Senior Vice President, International
Operations.
"I am confident this management team will implement key actions to generate
improved staff utilization and profitability," said Farrar.
In addition, the Company announced today that Robert Whitehead has joined
Xpedior's management team as Senior Vice President of Sales. Whitehead
brings 19 years of business development experience to his new position, most
recently as head of National Account Sales for Ernst & Young LLP.
Whitehead will drive sales efforts aimed at differentiating Xpedior's extensive
e-Business solutions capabilities for its Global 2000 and emerging digital
clients across all markets.
Xpedior will focus its marketing efforts exclusively on lead generation activities
that put customers in contact with Xpedior consultants and sales
professionals. The Company expects these efforts to generate a solid pipeline
of sales leads and ongoing business.
According to Campbell, "One of the realities we have addressed in preparing
to achieve these targets is the need to reduce staff as we close Q3. These
reductions will help lower SG&A expense and bring us back to the 70+%
utilization rate that drove strong revenue growth earlier this year.
"At the same time, we want to reassure our highly talented employee team
and our customers that these reductions will not impede Xpedior's ability to
continue delivering the kinds of eBusiness enterprise-wide client solutions that
have won worldwide recognition for excellence," he added.
Campbell concluded, "During the first half of 2000 we focused on growing
client demand for our end-to-end solutions capabilities. Our revenue growth,
revenue per consultant and gross margin exceeded targeted goals. Though our
momentum was interrupted in Q3, revenue for the quarter should still be
significantly higher than the 1999 comparable period. We also believe the
actions we have announced today can drive consistent growth beginning in
Q4. We're extremely upbeat about the quality of our business, and the depth
and strength of our current management team as we enter Q4."
(a) Earnings before interest, taxes, depreciation, and amortization excluding
non-cash stock compensation charges.
About Xpedior
Xpedior Incorporated provides innovative, comprehensive eBusiness solutions
for Global 2000 companies, government, and emerging digital businesses.
Xpedior helps its clients imagine new eBusiness capabilities, then delivers the
reliable, scalable, end-to-end solutions needed to bring them rapidly to
market. The company, headquartered in Chicago, has offices located in 25
cities in the United States, Europe, Canada, and Australia. Visit Xpedior at
www.xpedior.com or call 1-877-XPEDIOR.
Xpedior to Take 3rd-Qtr Charge, Cut 16% of
Workforce (Update1)
By Mark Johnson
Chicago, Sept. 26 (Bloomberg) -- Xpedior Inc., which helps businesses build
Web sites for electronic commerce, said it will cut 270 jobs, or 16 percent of
its workforce, and take a third- quarter charge after its revenue dropped in the
quarter.
Xpedior said it will reduce the number of employees to 1,430. Earlier this
month, the Chicago-based company said it expects sales to decline about 10
percent from the second quarter's $62.9 million. It blamed cutbacks by
``dot-com'' businesses on consultants and a move toward larger, complex
projects more dependent on a clear return on investment.
While the company didn't give a specific amount for the charge, spokesman
Dean Dranias said Xpedior expects to ``give guidance'' on that number in the
next few weeks. The company, whose clients include Hewlett-Packard Co,
Citigroup Inc. and PepsiCo Inc., won't close any of its 25 offices, he said.
The shares of Xpedior fell 13 cents to 4 in Nasdaq Stock Market trading. They
have fallen 86 percent this year.
More articles on Xpedior:
Xpedior
search.excite.com |
