Park reports Q2 order shortfall
The parent of gamma camera developer Park Medical Systems saidlast month that financial results for its second quarter willbe lower than expected due to a shortfall in orders. Park Meditechof Montreal reported that it expects a loss of about $2
The parent of gamma camera developer Park Medical Systems saidlast month that financial results for its second quarter willbe lower than expected due to a shortfall in orders. Park Meditechof Montreal reported that it expects a loss of about $2 million($2.7 million Canadian) on revenues of $1.5 million for the quarter.
In response to the shortfall, Park implemented a restructuringplan to cut costs. The company has changed from a direct salesapproach in the U.S. to an indirect strategy through the hiringof independent sales representatives. The company will also downsizeits Montreal operations. The reorganization affects about 30 employeesand is expected to save about $183,000 a month. In spite of therestructuring, Park said it would continue to accelerate developmentof new products.
In addition to the reorganization, Park Meditech chairman SheldonInwentash has resigned and has not been replaced. President andCEO Richard Mullen has been named acting chairman.
Park also obtained additional secured debt financing of $1.5million, and said that it plans to explore alternatives such asalliances with strategic partners. Park has struggled with cash-flowproblems recently, and received a $10 million infusion last yearfrom a Canadian capital development fund (SCAN 1/31/96).