During the fourth quarter, the Company has focused its energy on speeding up the integration process of Generation II, acquired by Ossur last October - in order to realize synergy out of the aquisition. It has been decided that the Generation II operating units in Vancouver and Seattle should be partly integrated with Ossur North America Inc. in California. Generation II marketing activities in North America will thus be directed from California, and all development work will be transferred to Seattle and Reykjavík. These changes will result in that several key employees will be made redundant. The restructuring cost is projected at USD 400,000 and the cost of transfering the development work from California is projected at 150.000 USD. All cost will be expensed before the end of the year.
The new managing director in Canada will be Steve Eastmann, former chief financial officer of Generation II in Canada.
As reported on November 11th 2003, a necessity to a shift in emphasis in sales and marketing activities in the Ossur North America - market area has initiated substantial managerial changes with the appointment of Mr. Eythor Bender as the new President of Ossur North America Inc. The cost of the reorganization is estimated to approximately USD 950,000, as previously announced, which amount will be expensed in the current quarter.
In December, a settlement was reached in the legal action taken by Ossur hf. against Freedom Innovations. The cost of litigation and negotiating the settlement in fourth quarter is estimated at USD 1,2 million - which total amount will be expensed in the fourth quarter. No revenues will accrue from the agreement in this quarter.
With an estimated operational loss for Q4 2003 in the range of 1 to 2 million USD, the Ossur Management now expect to see a financial result for the full year of 2003 of approximately USD 3.6 million to 4.6 million.
Further information:
Jón Sigurðsson, President & CEO, tel. +354-664-1049
Hjörleifur Pálsson, CFO, tel. +354-664-1020