Hemisphere GPS announces new corporate strategy
On Sept. 5, the Board of Directors of Hemisphere GPS initiated a restructuring mandate with the directive to implement a new profit-focused corporate strategy under the leadership of incoming CEO Rick Heiniger, formerly vice chairman of the company and founder of the Outback Guidance precision agriculture business.
Under Heiniger's leadership, the company has implemented a new corporate strategy built on three core principles to achieve profitable growth and market leadership:
1. Focus exclusively on the agriculture business.
2. Streamline and simplify operations.
3. Implement market-driven innovation.
For over a decade Hemisphere GPS has been a leading solutions provider to the precision agriculture market. In the first nine months of 2012, 81 percent of company revenue was derived from the agriculture business, most of which comes from the North American market. Past diversification into marine, construction and other industries increased costs, absorbed cash and distracted management focus from its core agriculture business. To focus exclusively on agriculture, the company will:
--Exit the non-agriculture-related business.
--Relocate company headquarters to Hiawatha, Kan., where Hemisphere GPS's agricultural operations are already strategically located, in the heartland of the North American agricultural industry. An abundant supply of agriculture trained and passionate talent, along with the pro-business climate in the state of Kansas, are two key factors for the site selection.
The company will adopt a market responsive product development focus with a customer-driven culture.
The restructuring will take place largely over the next 12 months, with the bulk of the costs being recorded in the fourth quarter of 2012. Total workforce, including employees and contractors, will be reduced from 273 to about 170. The existing agricultural business will not be interrupted during this process.
Upon completion, the savings from the overall restructuring are estimated to be approximately $7 million per annum through reduced manufacturing costs, improved gross margins and reduced operating overhead.
For more information, visit http://www.hemispheregps.com/.