December 3rd, 2008 by Arjan Olsder Posted in Companies & M&A | No Comments »
Remember the community interview we talked about before? According to our contact at Glu, Greg is still busy to fill in all the answers. Yet via Moconews, we found out that he is already answering several of them indirectly.
On of the more personal questions in the interview was if Greg will do anything with his salary in order to relieve the company a bit from one of the highest salaries in the business. Where other US CEO’s from companies like Chrylser and Ford have lowered their salaries to just $ 1, Greg has lowered his $ 375,000 salary by $ 93,750. Still this means that company would have to sell nearly 300,000 mobile games to make up for his salary.
“These decisions are difficult but necessary given the increasing economic headwinds facing our industry and the softening in consumer spending,” said Greg Ballard, chief executive officer. “By realigning our operations and resources worldwide, we are able to improve our financial performance in the near term while continuing to invest in key growth opportunities in the mobile games industry, especially surrounding high-end handsets and new platforms such as iPhone, Android and N-Gage. In addition, I have asked the Board to reduce my salary by 25% as part of our cost reduction efforts until the Company is demonstrating consistent progress toward our long-term goals.”
“This reduction in headcount and other operating expenses continues our focus on expense controls that began late in the second quarter of 2008 across all areas of our business to better position the Company’s financial foundation and support our growth initiatives,” said Eric R. Ludwig, senior vice president and chief financial officer. “These actions will improve our liquidity in 2009, and we continue to explore other avenues to improve our available cash and credit positions.”
Greg also announced that there will be layoffs in order to cut expenses by $ 13 million. Industry sources rumour that Glu is closing most of its Asian offices.
The Company currently estimates that, in connection with the workforce reduction, it will incur pre-tax restructuring charges in the fourth quarter of 2008 related to estimated severance costs in the range of approximately $625,000 to $675,000. Substantially all of these charges will result in future cash expenditures, of which the Company believes approximately $230,000 will be paid in the fourth quarter of 2008 and the remainder will be paid in the first quarter of 2009. Additionally, the Company expects to record a pre-tax, non-cash facility closure charge in the range of approximately $700,000 to $800,000 in the fourth quarter of 2008.
Visit MoCoNews for their full story.
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