Outerwall Reports Progress On Operating Review & Capital Structure Initiatives

(RTTNews) - Automated retail solutions provider Outerwall Inc. (OUTR) reported progress on its prior announced operating review and capital structure initiatives. The progress includes termination of three new venture concepts; a leadership transition at Redbox; cost reduction initiatives that may result in $22 million of annual cost savings beginning in the first quarter of 2014; and a $350 million expansion of Outerwall's existing senior secured credit facility, which would help in meeting its target leverage ratio in the first quarter of 2014.

The company has completed the review of its New Ventures business unit and would end three new venture concepts, Rubi, Crisp Market and Star Studio. The wind-down process is expected to be substantially complete by first-quarter 2014 end. The firm said it would continue to invest in the rollout of ecoATM, and a limited investment in its SAMPLEit concept.

Additionally, Outerwall announced a leadership transition as Redbox president Anne Saunders has left the business. Pursuant to this, Leadership roles for Redbox would be managed on an interim basis by the existing Redbox executive team, overseen by Di Valerio, until the post is filled on a permanent basis. Outerwall would begin a search process and expects to fill the role in the coming months. Further to the savings from the reduced spending in New Ventures, Outerwall is implementing actions to reduce costs by approximately $22 million annually beginning in 2014, primarily through workforce reductions across the enterprise.

Outerwall management is revising its full year 2013 guidance, to reflect the exit of certain new venture concepts. For the year, the company expects core earnings per share between $5.44 and $5.59 on a fully diluted basis; and consolidated revenue between $2.298 billion and $2.323 billion.