Ekinops R&D Center Closure Announcement
Ekinops (Euronext Paris – FR0011466069 – EKI), a prominent provider of telecommunications solutions, has made a significant decision to close its Brazilian subsidiary, Ekinops Brasil, located in Campinas, which is near São Paulo. This closure is scheduled to be finalized by the end of the year, marking an important shift in the company's operational strategy.
Currently, Ekinops Brasil employs 25 engineers and specializes in the Optical Transport business, which was significantly enhanced through the acquisition of OTN technology from the company Padtec in 2019. It's important to note that this subsidiary has not engaged in any commercial activities within Brazil.
Rationale Behind the Closure
The decision to shut down Ekinops Brasil stems from the company's broader vision to streamline its R&D efforts and improve overall operational efficiency. By closing this facility, Ekinops aims to reduce its annual operating expenses by approximately €3 million. The savings will enable the company to allocate resources more effectively and invest in key areas with higher potential for growth.
Refocusing on Lannion R&D Center
After the closure, Ekinops will shift its focus to its R&D center located in Lannion, which is set to play a pivotal role in the company's future innovation endeavors. This facility's recent upgrade in May 2024 will allow it to host double the current workforce, enhancing its capabilities to drive technology advancements.
Financial Implications and Impact
The closure will have a non-recurring impact on Ekinops' financial statements for the fiscal year 2024, with expected provisions and impairment of assets amounting to around €8 million. These figures primarily involve intangible assets, goodwill, and inventory adjustments. However, these costs will be classified as non-cash and non-recurrent in the company’s accounts.
Furthermore, the expenses directly tied to the closure of Ekinops Brasil are estimated at about €1 million, which will also be accounted for in the fiscal year 2024's operating income and expenses.
Leadership Contact Information
For further inquiries regarding this announcement, please reach out to Didier Brédy, the Chairman and CEO of Ekinops. His leadership is pivotal as the company navigates through this transitional phase.
Related Contacts:
Investors: Mathieu Omnes, Investor Relations, Telephone: +33 (0)1 53 67 36 92
Press Inquiries: Amaury Dugast, Press Relations, Telephone: +33 (0)1 53 67 36 74
Frequently Asked Questions
Why is Ekinops closing its Brazilian R&D center?
Ekinops is closing its Brazilian R&D center to optimize its operational structure and refocus its research and development efforts.
How many employees will be affected by the closure?
The R&D center employs about 25 engineers, all of whom will be impacted by this closure.
What financial impact will the closure have on Ekinops?
The closure is expected to incur a non-recurring accounting impact of approximately €8 million related to asset impairments.
Where will Ekinops focus its R&D efforts moving forward?
Following the closure, Ekinops will focus its R&D efforts at its center in Lannion, France, which has recently expanded its capabilities.
When is the closure of Ekinops Brasil scheduled to occur?
The closure of Ekinops Brasil is planned to be completed by the end of the current year.
