Distributed Energy Systems Corp. (Nasdaq: DESC), announced it will combine its two subsidiaries — Northern Power Systems and Proton Energy Systems — to reduce costs and strengthen systems sales, engineering, production, service and technology development.
The company, which creates and delivers products and solutions for the decentralized energy marketplace, said the reorganization will result in a charge against 2007’s first-quarter results of approximately $1.0 million, or $0.03 per share, to account for staff reductions, reflecting the elimination of about 60 renewable energy jobs, or 20% of the workforce.
The reorganization is estimated to result in savings of approximately $4-$5 million, on an annualized basis, beginning in the second quarter of 2007. In addition, the Waitsfield, VT, location will be closed, and its activities moved to the company’s 110,000-square-foot Barre, VT facility.
"During the past year, it became increasingly clear that we would benefit going forward by implementing our strategy now, to become a one-company organization," said Ambrose L. Schwallie, Distributed Energy’s CEO. "We expect these changes to improve sales and marketing effectiveness, reduce costs, enhance efficiencies of our systems engineering, products and service capabilities, and enable more and better cross- fertilization in advanced technology development."
"This new functional structure," Mr. Schwallie continued, "allows us to focus more precisely on the markets, critical business drivers and capabilities that give Distributed Energy the best prospects for the higher- margin revenues we need to foster strong, sustained, profitable growth."
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