* Heins at annual meeting says BB10 will turn RIM around
* CEO acknowledges shareholders' discontent
* Company's slate of directors elected by shareholders
* Few direct questions about RIM's strategy posed
* RIM shares drop 5 pct to $7.29 on Nasdaq
By Alastair Sharp
WATERLOO, Ontario, July 10 Research In Motion
Ltd's new CEO vowed on Tuesday to turn around
the embattled company with the new generation of BlackBerry
devices coming next year, saying he would transform RIM into a
"lean, mean, hunting machine."
But Thorsten Heins, presiding over his first annual meeting
since taking the helm, offered little to disgruntled
shareholders beyond his faith in the power of the BlackBerry 10
line to reverse RIM's fortunes. Its battered stock fell another
5 percent after he spoke.
"There was no mention of a sale of the company, no mention
of a breakup of the company, and again, our big, big concern is
if the BB10s are a dud," said Vic Alboini, chief executive of
Jaguar Financial and a long-time RIM critic. "Where are we
After a year that wiped out nearly 80 percent of RIM's value,
Heins acknowledged the frustration of shareholders with his
decision to delay the launch of the new phones until after the
crucial holiday shopping season.
"I am not satisfied with the performance of the company over
the past year," Heins told the mostly subdued audience. "Many of
you are frustrated with the time it has taken us to make our way
through the transition."
But Heins, who joined RIM from electronics giant Siemens AG
four year ago and took over as CEO in January, expressed
confidence that RIM was heading in the right direction.
"I have assembled a leadership team for RIM that's truly
capable of taking us into future," he told shareholders.
RIM virtually invented mobile email with its first
BlackBerry devices more than a decade ago, but its market share
has evaporated as consumers flock to Apple Inc's iPhone
and devices based on Google Inc's Android system.
RIM last month posted its first operating loss in eight
years, and it was much deeper than expected. The company also
said it was cutting 5,000 jobs, almost a third of its workforce,
as it struggles win back its reputation as an industry
At the same time the company pushed back the launch of the
BlackBerry 10 devices to next year from the final quarter of
this year. Heins said the delay reflected RIM's determination to
make sure that the devices were ready for the big time.
"We're working day and night to bring it out and prove the
point that it is what we say it is," he told reporters after the
RIM plans to prune down its extensive array of BlackBerry
models to focus on high-end and mid-range devices that will come
with either touchscreen or physical keyboards, Heins said.
But things will probably get worse before they get better.
Heins conceded that RIM would likely suffer lower average
selling prices and declining service revenue this year as it
pushes to sell existing BlackBerry devices.
Despite the deep problems, investors who attended the
meeting in a university lecture hall in RIM's hometown of
Waterloo, Ontario, avoided many of the tougher questions that
analysts have thrown at the BlackBerry maker.
One shareholder blasted earlier versions of the board which
he said had failed to keep management accountable, while another
poked around the details of the CEO's compensation package.
Throughout the session Heins was adamant that RIM's best
path forward was the BlackBerry 10, even if the strategic review
now underway concludes that a sale of the company makes the most
sense. RIM has said it is examining all options, including
partnerships, joint ventures or a break-up of the company.
RIM might be able to provide more about on the outcome of
the strategic review in a few months, Heins told a handful of
reporters after the meeting.
"There is a lot of action going on, looking at very
different options for what the company could do," he said. "When
it's time to go public with it, we'll go public with it."
The stock, which slipped 5 percent to $7.29 on Nasdaq, once
traded as high as $148.13, and several small investors told
Reuters they were confident RIM could regain at least some of
its past glory in the next two or three years.
"They're in survival mode, but if they survive their
business will go right back to, in my view, the levels above
$60," said Ted Cross, a retired 76-year-old who bought his
shares in the high $20 range. "I'm confident the company will
survive and thrive."
One of the few dissenting voices in the hall came from
Jaguar Financial's Alboini, who says he speaks for an informal
alliance of disgruntled RIM investors. He asked what steps RIM
was taking to attract more new board members with technology and
financial industry experience.
Chairwoman Barbara Stymiest said the company aimed to add
several new members to the board this year and hired an external
firm to assess candidates. She pointed out that four of the
board's 10 members have joined in the last year.
Despite RIM's recent performance, the company's slate of
directors was elected at the meeting with token opposition,
although preliminary results showed some shareholders withheld
their votes, including 19 percent for former co-CEO Mike
John Richardson had 30 percent of votes withheld, following
the recommendation of proxy advisory firm Glass Lewis. It said
Richardson, as lead director, had failed to properly oversee the
provision of stock options to RIM employees, which were
erroneously back-dated over an eight-year period.