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CYBEX INTERNATIONAL, INC.
ANNOUNCES RESTRUCTURING PLAN
MEDWAY, MA, DECEMBER 29, 2000 - Cybex International, Inc. (AMEX: CYB), a
leading exercise equipment manufacturer, today announced a reduction in staff as
part of a restructuring plan to streamline operations, improve efficiency and
reduce costs. The restructuring plan includes elimination of about 26% of the
workforce, effective immediately.
Cybex also announced that Robert Hodges, Senior Vice President -
Manufacturing and Development, has resigned. This position and the position of
Vice President - Engineering, held by Neil Landry, have been eliminated. As
part of the Company's restructuring program, product development will become a
cross functional effort of sales, marketing, product management, engineering and
manufacturing, led by Jason Ferwerda, Vice President of Operations - Medway for
cardiovascular equipment and by Ed Kurzontkowski, Vice President of Operations -
Owatonna for strength equipment. Ferwerda and Kurzontkowski will also be
responsible for manufacturing and engineering in their respective product areas.
Severance and related charges pertaining to these layoffs and the
previously announced resignations of three executive officers are anticipated to
result in a fourth quarter non-recurring after-tax charge of approximately $1.5
million. Other fourth quarter non-recurring charges may also result from the
restructuring plan.
The premium-price segment of the exercise equipment market in which the
Company competes has become extremely soft during the fourth quarter. In
addition, policies adopted as part of the restructuring plan, including a
tightening of the Company's credit standards, are expected to negatively impact
sales. As a result, the Company anticipates that its net sales for the fourth
quarter 2000 will fall 28 % to 32 % below net sales for the corresponding
period of 1999 and that the Company will incur a net loss before non-recurring
items for the quarter and the year. The Company expects that the softness in
sales will continue at least into the first half of 2001.
John Aglialoro, Chairman and acting Chief Executive Officer, stated: "Cybex
faces a challenging market. We have responded forcefully to make the Company a
more efficient, streamlined operation. We believe that these steps will not
only result in significant cost reductions, but once fully implemented will also
place the Company in a position to aggressively seek sales growth and to return
to profitability in 2001."
Commenting on the changes in the product development and manufacturing
areas, Mr. Aglialoro continued: "Cybex has moved to a more direct, less
bureaucratic system for product development. We are confident that this new
system, by combining all relevant disciplines in the product development process
while at the same time eliminating needless administrative levels, will lead to
faster, more successful new product launches. In addition, manufacturing will
now be in the hands of two seasoned Cybex officers."
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Cybex International, Inc. is a leading manufacturer of premium exercise
equipment for consumer and commercial use. Cybex and the Cybex Institute, a
training and research facility, are dedicated to improving human performance
based on an understanding of the diverse goals and needs of individuals of
varying physical capabilities. Cybex designs and engineers each of its products
and programs to reflect the natural movement of the human body, allowing for
variation in training and assisting each unique user - from the professional
athlete to the rehabilitation patient - to improve their daily human
performance. For more information on Cybex and its product line, please visit
the Company's web site at www.eCybex.com.
This news release may contain forward-looking statements. There are a
number of risks and uncertainties that could cause actual results to differ
materially from those anticipated by the statements made above. These include,
but are not limited to, competitive factors, technological and product
developments, market demand, uncertainties relating to the consolidation of the
merged and acquired companies' businesses and uncertainties relating to the
implementation of the restructuring plan. Further information on these and
other factors which could affect the Company's financial results can be found in
the Company's previously filed Reports on Form 10-K for the year ended December
31, 1999, its Form 10-Q for the period ended September 30, 2000, its Current
Reports on Form 8-K, and its proxy statement dated April 18, 2000.
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