Lateral thinking needed at Wolfson Microelectronics
Wolfson Microelectronics has warned it is at the mercy of the consumer electronics sector, and the tough economic climate has seen a 27% fall in first-half profits to £9.1m (£4.6m) As a result, the company is reviewing its non-R&D costs. First-half revenues grew 12% to $100.3m. CEO David Shrigley said it was impossible to tell how long the "very uncertain "downturn would last,described it as "very uncertain". The company said falling demand for consumer electronics would also hit Q3 sales, and that costs and jobs would be cut to combat the downturn. The company employs around 370 at its Edinburgh headquarters.
Shrigley also noted that the company will not cut any fundamental capability affecting the company's long term future as the plan is to preserve that. The 180 workers involved in Wolfson's R&D operation would not be included in the business review, which would be completed by the end of the company's Q3.
Wolfson's chips are best-known for converting digital data into analogue signals for speakers but supplies chips for DVD players, computer game consoles, Satnav systems, flatscreenTV, digital radio and set-top boxes and cameras. The chips are key components of the fast-growing number of portable listening and communications devices, such as Apple iPod music players and multimedia mobile phones. Higher fuel and rising raw materials prices have also cut into profitability and hampered consumer demand. However, Shrigley is confident that one area of growth that will continue is smartphones.
Part of Wolfson first-half decline was $6.5m in costs relating to its 2007 purchase of Oligon and Sonaptic. Oligon, the MEMS design company brought Wolfson the AudioPlus MEMS microphone developed to be manufactured using standard CMOS processing steps allowing standard foundry manufacture. Sonaptic specialised in a 3D Audio Engine which offered considerable advancement in 3D sound realism and quality for devices.
Since acoustics applications exist in a wide range of industrail areas, sectors as divers as the genetic community (increasingly interested in the detection of molecular interactions through acoustic technology) to the attraction of hydro-acoustics for horizontal drilling, it could be specialist niche markets might be increasingly attractive to help offset the hard-hit consumer business.
Source: http://www.theherald.co.uk
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