ARC sees licence revenues hit by falling confidence

ARC International has warned of lower than expected revenues from semiconductor IP licensing at the end of 2008.

“For 2009, management continues to remain cautious due to continuing uncertainty in the economic environment and fundamental industry changes,” said the semiconductor IP developer.

The company saw growth in royalty revenues in the year as a whole, the concern is that the increases were offset by lower than expected licensing revenues in the closing weeks of the year.

This was due to rescheduling by two customers of licensing decisions in response to continued deterioration of industry confidence.

As a result, revenues from the full-year 2008 are expected to be in the range of £15.7m to £16.2m ($29m to $30m). 

The processor IP developer is also looking to reduce costs in order to address the dramatic decline in the sterling exchange rate. This is further to a reorganisation plan announced in September 2008.

The additional actions will necessitate £500,000 of the restructuring charge being taken in the first quarter of 2009. 

ARC’s cash position sits at £12.6m. The company will report interim and full-year results on February 25, 2009.

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