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To: Susan G who wrote (5508)	5/31/2001 9:12:51 AM
From: Frederick Langford	Read Replies (1) \| Respond to of 5732

Tellabs to Record $262 Million in Restructuring and Other Charges In Second Quarter /FROM PR NEWSWIRE 800-682-9599/ TO BUSINESS EDITOR: Tellabs to Record $262 Million in Restructuring and Other Charges In Second Quarter of 2001 LISLE, Ill., May 31 /PRNewswire/ -- Tellabs will record restructuring and other charges totaling approximately $262 million in the second quarter of 2001, as a result of the company's previously announced restructuring. On April 18, Tellabs estimated restructuring and other charges to be in the range of $150 million to $225 million. The larger charge reflects a thorough review of facilities, assets and inventory in light of current industry conditions. "We are taking the right steps to ensure Tellabs' long-term financial strength," said Joan Ryan, executive vice president and chief financial officer of Tellabs. "We are focused on taking the most profitable path through the current environment." The charges consist of: * $93 million related to Tellabs' exit from the SALIX(R) next-generation switching business, including a $34 million inventory write-off. The remainder stems from facility closures and related fixed assets, excess purchase commitments, as well as employee-related costs from a workforce reduction. * $40 million for consolidation of other excess facilities, employee-related costs and fixed-asset charges that are designed to align Tellabs' resources with demand. * $129 million in other inventory-related charges, which includes a $46 million reserve for excess purchase commitments. The bulk of the inventory-related charge is for CABLESPAN(R) products, and relates to recently reduced demand and residential service unit inventory that will be superceded by new, upgraded units later this year. The balance covers excess raw materials inventory and excess purchase commitments for other products.