DZS Announces CFO Departure

Rhea-AI Summary

DZS (OTC: DZSI), a developer of Networking and Connectivity solutions, announced that CFO Misty Kawecki will step down at the end of September following the completion of the company's financial restatement. Brian Chesnut, appointed as Chief Accounting Officer in April 2024, has been named interim Chief Financial Officer.

The company recently completed its financial restatement and is now focusing on a new chapter leveraging advanced networking and connectivity solutions. DZS has also undergone significant changes, including the divestiture of its Asia business and the acquisition of NetComm, with its regional strategy now centered on North America, EMEA, and ANZ.

Positive

• Successful completion of financial restatement
• Appointment of Brian Chesnut as interim CFO, bringing experience from a $1 billion market-leading company
• Strategic focus on North America, EMEA, and ANZ markets
• Acquisition of NetComm to enhance product offerings

Negative

• Departure of CFO Misty Kawecki
• Divestiture of Asia business, potentially reducing market presence
• Recent financial restatement indicates past accounting issues

Financial Analyst

The departure of CFO Misty Kawecki and appointment of Brian Chesnut as interim CFO marks a significant transition for DZS. The completion of the financial restatement process is a positive development, indicating improved financial transparency. However, the need for a restatement in the first place raises concerns about previous financial reporting practices.

The company's strategic shift, focusing on North America, EMEA and ANZ markets after divesting its Asia business and acquiring NetComm, signals a major realignment. This could potentially lead to more streamlined operations and better resource allocation. Investors should closely monitor how this new strategy impacts revenue and profitability in the coming quarters.

Brian Chesnut's background as a CPA with experience in a $1 billion company could bring valuable financial expertise to DZS. However, the interim nature of his appointment creates some uncertainty about long-term financial leadership.

Tech Industry Analyst

DZS's focus on "Networking and Connectivity solutions enabling broadband everywhere" positions it in a high-growth sector. The broadband industry is experiencing rapid expansion, driven by increasing demand for high-speed internet and 5G rollouts. DZS's strategic realignment to focus on specific regions could help it capitalize on these opportunities more effectively.

The company's recent acquisition of NetComm and divestiture of its Asia business indicate a significant shift in market strategy. This could potentially lead to better product integration and market penetration in the targeted regions. However, investors should be cautious about potential integration challenges and the loss of revenue streams from the divested Asian operations.

The mention of "the industry's most advanced networking and connectivity solutions" suggests strong product offerings, but investors should seek concrete evidence of technological leadership and market adoption in future reports.

Corporate Governance Expert

The CFO transition at DZS raises some governance concerns. While it's positive that the financial restatement has been completed, the need for such a process often indicates previous internal control weaknesses. Investors should scrutinize the nature and extent of the restatement to assess any potential ongoing risks.

The appointment of Brian Chesnut as interim CFO, following his recent joining as CAO in April 2024, suggests a rapid elevation. While his qualifications are solid, the quick transition may indicate a lack of succession planning. Shareholders should monitor the search for a permanent CFO and assess the stability of the finance team.

The CEO's statement about "turning the page" implies a desire to move past recent challenges. However, investors should seek assurances that lessons have been learned and that robust financial controls are now in place to prevent future restatements.

Misty Kawecki to step down as CFO in September; Brian Chesnut to become interim CFO

DALLAS, Sept. 13, 2024 (GLOBE NEWSWIRE) -- DZS (OTC: DZSI), a developer of Networking and Connectivity solutions enabling broadband everywhere, today announced that Chief Financial Officer (CFO) Misty Kawecki will step down at the end of September following the successful completion of the company’s financial restatement.

“The Board of Directors and I appreciate Misty guiding us through the completion of our restatement process,” said Charlie Vogt, President and CEO, DZS. “With the restatement now behind us, and our regional go-to-market strategy squarely focused on North America, EMEA and ANZ following the divestiture of the Asia business and our acquisition of NetComm, we must turn the page and focus on a new chapter leveraging the industry’s most advanced networking and connectivity solutions.”

In April 2024, DZS appointed Brian Chesnut as Chief Accounting Officer (CAO). Mr. Chesnut joined DZS from Continental Battery, a ~$1 billion market leading battery systems company. He received his Master’s of Accounting from the University of Utah along with dual Bachelor’s degrees in Accounting and Finance. He is a Certified Public Accountant (CPA). He is licensed in the states of Texas and Utah.

Mr. Chesnut has been named the interim Chief Financial Officer.

“It has been a dynamic market environment over the past several years fueled and impacted by the Covid pandemic,” said Misty Kawecki. “I am grateful to have had the opportunity to lead a committed finance team that persevered through multiple acquisitions, a global ERP implementation and financial restatement. Charlie is a visionary with valuable relationships that span the broadband industry, and I am grateful to have worked alongside such a committed and resilient leader as well as his talented management team.”

About DZS

DZS Inc. (OTC: DZSI) a developer of Networking and Connectivity solutions enabling broadband everywhere.

DZS, the DZS logo, and all DZS product names are trademarks of DZS Inc. Other brand and product names are trademarks of their respective holders. Specifications, products, and/or product names are all subject to change.

This press release contains forward-looking statements regarding future events and our future results that are subject to the safe harbors created under the Private Securities Litigation Reform Act of 1995. These statements reflect the beliefs and assumptions of the Company’s management as of the date hereof. Words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “goal,” “intend,” “may,” “plan,” “project,” “seek,” “should,” “target,” “will,” “would,” variations of such words, and similar expressions are intended to identify forward-looking statements. Readers are cautioned that these forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions that are difficult to predict. The Company’s actual results could differ materially and adversely from those expressed in or contemplated by the forward-looking statements. Factors that could cause actual results to differ include, but are not limited to, those risk factors contained in the Company’s SEC filings available at www.sec.gov, including without limitation, the Company’s annual report on Form 10-K, quarterly reports on Form 10-Q and subsequent filings. In addition, additional or unforeseen effects from the COVID-19 pandemic and the global economic climate may give rise to or amplify many of these risks. Readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date on which they are made. DZS undertakes no obligation to update or revise any forward-looking statements for any reason.

For further information see: www.DZSi.com
DZS on Twitter: https://twitter.com/dzs_innovation
DZS on LinkedIn: https://www.linkedin.com/company/DZSi/

Investor Inquiries:
Geoff Burke, SVP Marketing and Investor Relations
Email: IR@dzsi.com

FAQ

When is CFO Misty Kawecki leaving DZS (DZSI)?

Misty Kawecki will step down as CFO of DZS (DZSI) at the end of September 2024, following the completion of the company's financial restatement.

Who will be the interim CFO of DZS (DZSI) after Misty Kawecki's departure?

Brian Chesnut, who was appointed as Chief Accounting Officer in April 2024, has been named the interim Chief Financial Officer of DZS (DZSI).

What major changes has DZS (DZSI) recently undergone?

DZS (DZSI) has recently completed a financial restatement, divested its Asia business, acquired NetComm, and refocused its regional strategy on North America, EMEA, and ANZ markets.

What is DZS (DZSI)'s current market focus after recent changes?

Following the divestiture of its Asia business and acquisition of NetComm, DZS (DZSI) is now focusing its regional go-to-market strategy on North America, EMEA (Europe, Middle East, and Africa), and ANZ (Australia and New Zealand).