Iomega has named Werner T. Heid, a member of the company’s board of directors since May 2000, as its new president and chief executive officer. In addition to his new responsibilities Heid will continue to serve on the board.
He’s bringing 16 years of experience in the computer peripherals industry to the company. He was named president of Proxima, a manufacturer of multimedia projectors, in 1998. Following Proxima’s merger with InFocus Corp., another manufacturer of multimedia projectors, he served as executive vice president of worldwide sales, marketing and service at InFocus Corp. Heid spent the first 12 years of his career in marketing roles with Hewlett-Packard (HP), working internationally with products including Inkjet, LaserJet, color copiers and All-in-One.
“My eyes are wide open to the challenges that lay ahead of me, but I am steadfast in my belief that Iomega will recapture its position as the de facto standard for data-management in today’s digital revolution,” Heid said in a statement. “We are creating new applications and technologies that will give people new reasons to use the 42 million Zip drives out there. At the same time, we’re building a new legacy around exciting new products such as Peerless.”
His first days as head honcho look to be challenging ones, to say the least. Today Iomega announced that revenue in the second quarter of 2001 may be in the range of US$180 to $190 million, down from revenue of $304 million in the second quarter of 2000. As a result, the company expects to report a pre-tax loss for the second quarter of 2001. (The second quarter results will be announced after the close of business on July 19.)
“The revenue shortfall in the second quarter is due mainly to lower Zip and Jaz revenue,” said Philip Husby, chief financial officer, Iomega. “Sales of HipZip, FotoShow and CD-RW have also been below our expectations. We expect to record charges in the second quarter that reflect our best judgment regarding the net realizable value of HipZip, FotoShow, and CD-RW inventory at Iomega and in Iomega’s retail and distribution channels, possible loss accruals for related supplier purchase commitments, and other charges.”
Iomega’s pre-tax loss for the quarter is expected to range from $41 to $62 million, including charges ranging from $33 to $50 million. The company continues to examine opportunities to reduce costs, according to Husby. Last week, the company announced that its
worldwide manufacturing operations would be consolidated at Iomega’s Penang, Malaysia, manufacturing facility.