Quantum Provides Insight on Recent Events and Future Direction; Renewed Focus on Automotive Technologies; Cost Reduction Plan
Quantum Fuel Systems Technologies Worldwide (NASDAQ: QTWW) is providing an update on the near term direction and focus of the Company following recent executive management changes.
At a board meeting held on May 10, 2012, issues of direction, focus, execution and cost structure were addressed. Following discussion on these matters, the board accepted the resignations of the former Chairman and CEO, as was reported in a press release the following day. The board members want to assure stakeholders that they (i) are enthusiastic about the Company's opportunities, technology and asset mix, and (ii) have full confidence in the new leadership team to execute on the Company's near-term direction, which is to grow, expand and enhance the Company's core automotive products and technologies, reduce its operating costs in an effort to restore confidence, as well as rebuild and grow stockholder value. The board does not expect recent executive management changes to have an adverse effect on existing customer and supplier relationships, contracts, or significant opportunities before the Company.
As a sign of the board's and management's commitment to this renewed vision, direction and focus, members of the Company's management team and board of directors have recently purchased shares of the Company's common stock on the open market.
The Company aims to grow, expand and enhance its profile as a technology leader in the alternative fuel automotive sectors by investing in the expansion of its manufacturing capacity for compressed natural gas and hydrogen storage systems, as well as directing additional resources toward the sale and marketing of its advanced energy storage and hybrid/electric propulsion systems products and technologies.
The Company plans to make strategic assessments of its renewable energy projects and minority-owned investments which lie outside of the Company's core automotive technology focus, including reviewing opportunities for accretive investments that require minimal capital commitment by the Company.
In addition, the new leadership team will aggressively seek to reduce operating costs, particularly corporate, general and administrative expenses, through a variety of cost-cutting initiatives, some of which have already been implemented in full or in part, including executive attrition and salary reductions, consolidation of facilities, and reductions in board of directors' fees.
The Company anticipates that operating costs can improve by approximately $4.1 million on an annual basis after the actions described below, along with other cost reduction initiatives, are fully implemented, which is expected to occur over the next six to twelve months.
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