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Solta Medical revealed, alongside its third quarter results, a restructuring programme to improve its financial performance as well as the hiring of an advisor to assist the board in considering strategic alternatives, which may include a possible sale or merger.
According to the company, the restructuring plan is expected to reduce annual expenses by $12 million. "To achieve our 2014 objectives, we have implemented cost reductions that included a reduction in work force," said interim CEO Mark Sieczkarek, noting that the plan's key objectives are to achieve year-over-year revenue growth, generate double digit operating profit and maximise cash flow from operations. "These changes will improve our financial results next year, while making us a more customer friendly organisation," Sieczkarek added.
In the quarter, revenue fell to $33.5 million from $35 million year-over-year, falling below analysts' estimates of $40.7 million. Net income rose to $0.6 million from a loss of $2.9 million in the year-ago period. Solta noted that results for the three months included an $8.7 million credit for the fair value reassessment of expected earn out payments associated with the acquisitions of Liposonix and Sound Surgical Technologies.
Sieczkarek commented, "despite the disappointing financial results in Q3, we have made recent progress in stabilising and reinvigorating the North American sales force and expect to enter 2014 with growing momentum."
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