CSR Third-Quarter Profit Drops on Zoran Costs, Inventory Charge
CSR Plc (CSR), the U.K. maker of chips used in Nokia Oyj mobile phones, said third-quarter profit fell 81 percent on costs related to its acquisition of Zoran Corp.
Net income dropped to $5.1 million from $27.4 million a year earlier, the Cambridge, England-based company said in a Regulatory News Service statement today. Revenue grew 9.5 percent to $243.3 million and included one month of sales from Zoran, which makes chips for digital audio and video products.
CSR said it is seeing “cautious order patterns” and expects fourth-quarter revenue of about $230 million to $250 million.
CSR bought Zoran in August to add imaging and video capabilities in its existing markets and diversify the revenue stream. Third-quarter revenue excluding Zoran was $209.2 million, down 5.8 percent from a year earlier. The company said in September that third-quarter sales excluding the Zoran unit would be about $200 million to $220 million.
The company is “on track to achieve our announced merger integration synergies, in addition to Zoran’s planned cost reductions,” Chief Executive Officer Joep van Beurden said in the statement. “We expect cross-selling opportunities to increase over the coming quarters.”
CSR is targeting a gross margin of between 48 percent and 52 percent and research and development costs of about 23 percent of revenue after the Zoran deal, the statement said.
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