SARASOTA, Fla., Oct. 10, 2016 /PRNewswire/ -- xG Technology, Inc. ("xG" or the "Company") (Nasdaq: XGTI, XGTIW), a leader in providing critical wireless communications for use in challenging operating environments, announced that it is on track to record annual cost savings exceeding $2.0M resulting from synergies realized by the acquisition of Integrated Microwave Technologies (IMT). This is above the amount forecasted in February 2016 when the acquisition was concluded, and includes cost reductions that have already been recorded as well as ones that are still coming.
Among the areas where cost reductions have been and/or will be realized since IMT became a business unit of xG are the following:
- Rightsizing of staff levels to align headcount with near and mid-term realizable revenue opportunities. This has included replacing contractors used in both the xMax and IMT business units, and integrating the engineering talent of both business units to support product and technology development efforts for all product lines. This has resulted in a reduction in costs of approximately $700,000 annually;
- Relocation of all manufacturing of xMax products to IMT's facility in New Jersey, which will result in savings of up to $700,000 per year;
- Downsizing the company's Fort Lauderdale facility, resulting in savings of approximately $150,000 per year;
- Efficiencies resulting from unification of the sales operations of the xMax and IMT business units under common sales management, which will provide savings of approximately $175,000 annually;
- Expected continuing savings in lease and related costs as operations in New Jersey are rightsized, amounting to an additional $150,000 to $200,000 per year;
- Costs reductions realized in the Company's internal software application licensing contracts, web site development and hosting fees, and fees paid to external public relations and other contractors, resulting in savings of approximately $50,000 per year;
- Significant enhancements made to the Company's accounting processes and functions, resulting in increased efficiencies and better operational compliance.
In addition to driving cost savings, cross-training of personnel to provide integrated solutions incorporating both xMax and IMT products enables xG to identify and close on new business opportunities. The most recent example of this was the recently announced $3.0M award xG won in partnership with the Southwest Research Institute for a spectrum sharing technology prototype.
George Schmitt, CEO and Chairman of the Board of xG Technology, said, "We continue to streamline our operations consistent with the efficiencies we envisioned attaining when we acquired IMT. We are realizing significant savings in all key operational areas, including staff headcount levels, sales, manufacturing, production and technology development. We expect this trend to continue as we deliver on our goal of monetizing our technology assets and identifying new business opportunities."
About xG Technology, Inc.
Founded in 2002, xG Technology has created a broad portfolio of intellectual property that enables always-available, always-connected and always-secure voice, broadband data and video communications. The company is the developer of xMax, a patented all-IP software-defined cognitive radio network that delivers mission-assured wireless connectivity in any RF environment. xMax provides a solution to the challenges of interoperability, survivability and flexibility in expeditionary and critical communications networks. xMax can be deployed as fixed or mobile infrastructure to enhance and integrate seamlessly with legacy communications systems, both private and commercial. Access and priority can be controlled, and in the event of congestion, failure or denial of access to commercial networks, xMax provides a fully secure, scalable, private and highly resilient network for essential communications – all at zero bandwidth cost.
xMax incorporates advanced optimizing technologies that include spectrum sharing, interference mitigation, multiple-input multiple-output (MIMO) and software defined radio (SDR). These and other technologies make xMax ideal for wide area, as well as rapid emergency communication deployment in unpredictable environments and during fluid situations. xG offers solutions for numerous industries worldwide, including military, emergency response and public safety, telemedicine, urban and rural wireless broadband, utilities, and critical infrastructure.
xG's Integrated Microwave Technologies (IMT) business unit further supports xG's military and public safety customers with its mission-critical wireless video solutions. IMT is a leader in advanced digital microwave systems and a provider of engineering, integration, installation and commissioning services serving the MAG (Military, Aerospace & Government), broadcast, and sports & entertainment markets. IMT's product lines include digital broadcast microwave video systems and compact microwave video equipment for licensed and license-free applications. More information on IMT can be found at www.imt-solutions.com.
Based in Sarasota, Florida, xG has over 100 patents and pending patent applications. xG is a publicly traded company listed on the NASDAQ Capital Market (symbol: XGTI) For more information, please visit www.xgtechnology.com
Cautionary Statement Regarding Forward Looking Statements
Statements contained herein that are not based upon current or historical fact are forward-looking in nature and constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements reflect the Company's expectations about its future operating results, performance and opportunities that involve substantial risks and uncertainties. These statements include but are not limited to statements regarding the intended terms of the offering, closing of the offering and use of any proceeds from the offering. When used herein, the words "anticipate," "believe," "estimate," "upcoming," "plan," "target", "intend" and "expect" and similar expressions, as they relate to xG Technology, Inc., its subsidiaries, or its management, are intended to identify such forward-looking statements. These forward-looking statements are based on information currently available to the Company and are subject to a number of risks, uncertainties, and other factors that could cause the Company's actual results, performance, prospects, and opportunities to differ materially from those expressed in, or implied by, these forward-looking statements.
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