Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Matt Sheerin with Thomas Weisel Partners, please go ahead.
Matt Sheerin - Thomas Weisel Partners
Yes, thank you and good morning. First question is with regard to the restructuring program that you’ve announced. Could you tell us what the capacity utilization rate now is for the company, and what your target would be, and ask you to take that capacity offline and you transfer projects to other manufacturing plants. Historically, you’ve had some issues in the past doing that. So, what kind of safeguards or plans do you have to ensure a more seamless transition?
Paul Nicoletti
Hey good morning Matt, thanks for your question. The company is currently operating around 50% utilization. Upon completing these actions, at current revenue levels, we think this will take us up into the 60% range.
As far as program transfers, I think that that’s something we’ve done a good job executing in the last few years. The teams here, consistent with the operating improvements that we’ve seen across the board have been executing extremely well, so we have a very focused process on program transfers and I’m pretty confident here that we won’t run into any issues.
I guess, I should also note to you that overall, while we are not giving any specific details around sites and locations, that the revenue that’s impacted is nominal as far as what’s moving.
Matt Sheerin - Thomas Weisel Partners
Okay great, and my second question, as you look at the pipeline opportunity of new business, you’ve done a terrific job of bringing gross margin up. So, when you look at new business, particularly on the consumer side, how do you weigh the margin targets versus returns in evaluating new business?
Craig Muhlhauser
Well Matt, good morning, it’s Craig here. We have target thresholds for each of the major market segments, and based on the operating leverage we are getting in the improvement and execution, we are using a portfolio approach to balancing the mix and managing the revenue targets, as well as the returns to maintain industry leading objectives frankly, when it comes to operating margin and return on invested capital, and I think you’ll see some of the early results here in the last number of months and quarters here as we’ve executed beginning time.
Matt Sheerin - Thomas Weisel Partners
Okay, thank you.
Craig Muhlhauser
- To read the full transcript on Seeking Alpha, click here »
