Refocus, reorganize, rebuild
LEWISVILLE, Texas - The past few years have been a bumpy ride for American Building Controls, as the company has tried to find its way after selling off its CCTV business to focus on other competencies.
But time appears to have paid off for the company formerly known as Ultrak. The com-pany now has a plan to focus on its MDIÃ‚Â access control business, streamline operations and sell its non-core businesses.
In early March, American Building Controls announced a major reorganization initiative that involves selling its retail consumer product business, SecurityandMore, and its industrial distribution business, IVS.
Its remaining entities, MDI and ABM Data Sytems, which provides alarm management software, will provide the foundation for the companyÃ¢â‚¬â„¢s new focus. Company officials have yet to make a decision on whether it will sell its Mobile Video Division.
The sale will result in American Building ControlÃ¢â‚¬â„¢s eliminating half of its $40 million in revenue generating business, but company officials expect the bold move will allow it to refocus attentions on growing segments of the market.
Ã¢â‚¬Å“WeÃ¢â‚¬â„¢re starting over,Ã¢â‚¬Â said Danny Mills, chief executive officer of American Building Controls.
Mills said the companyÃ¢â‚¬â„¢s ABM and MDI business had been neglected over the years.
At one time, MDI was a leading provider of access control systems with clients that included the government. Today, Mills said MDI is down to legacy system customers and has done little work in recent years to bring new customers and technology onboard.
ABM, on the other hand, provides central stations with an alternative alarm monitoring software platform and is viewed by Mills as a market that has increasing opportunity.
Plans call for MDI and ABM to work together to eventually offer an integrated solution to the market.
The reorganization also calls upon American Buildings Controls to initiate cost cutting measures. The company currently employs 150 people and has offices in Rancho Cucamonga, Calif., and Austin, Texas.
By the end of the third quarter, Mills expects the company will have half as many employees, thanks to the sale of SecurityandMore and IVS and some streamlining to reduce operating expenses by 20 percent in 2004
Ã¢â‚¬Å“ ThereÃ¢â‚¬â„¢s a tremendous amount of overhead at this company,Ã¢â‚¬Â said Mills.
American Building Controls recently eliminated at least one financial drain on the company when it settled an outstanding severance package and ended an assistant to the chief executive officer position held by former chief executive officer George Broady. The assistant position paid Broady $2,500 a month.
With a reorganization afoot, American Building Controls has targeted a three-year growth rate of 40 percent and cash flow positive results by the end of its third quarter this year.