DEIX to exit satellite radio business.......
http://biz.yahoo.com/prnews/081105/law084.html?.v=101
""While it is never an easy decision to exit any market, there are a number of factors that made exiting the satellite radio business the only logical choice for us. These factors include a dramatic drop in demand for aftermarket satellite radio, increasing warranty returns and decreasing margins that we and our customers have experienced throughout 2007 and 2008 on satellite radio products, and the large working capital commitment required for this relatively low margin business. Exiting this business will allow us to return 100% of our focus in 2009 to improving the experience we deliver to our customers and growing our highly profitable security and entertainment businesses."
Kevin Duffy, DEI Holdings' CFO, commented, "Exiting the satellite radio business will not only allow us to focus on our core business, but also increase our ability to pay down debt by recovering the $20 to $25 million of working capital we have committed to this business. Additionally, we are pleased with the terms of our wind-down agreement, as SIRIUS XM or their new partner will be purchasing substantially all of our remaining satellite radio inventory in the first quarter of 2009. They will also be taking full responsibility for all future product returns and warranty costs after January 31, 2009, regardless of when the product was sold."
Mr. Duffy continued, "Looking at the fourth quarter and into 2009, we anticipate that purchases of consumer electronics products will continue to decline significantly. As a result, we are taking every practical action to optimize our sales while preserving our margins. In addition, considering the realities of selling into this uncertain market, as well as our planned exit from the satellite radio receiver business next year, we plan to continue rightsizing our facilities and other overhead in all divisions of the company. Combined with the restructuring initiatives we have already implemented, we are confident that we are as well positioned as possible from an operational perspective to weather the current environment.""