The following are excerpts from an interview conducted with Sunrise Medical's new chief executive officer and president Michael Hammes.

HC: What are your goals for Sunrise?

Sunrise has been and should be the pre-eminent provider of the markets that we serve, and it needs to be there in a very solid way. Not just from a product point of view and not just from a customer base point of view, but from all points of view-in terms of growth and in terms of profitability. We need to get that back.

HC: What skills do you bring that translate to this industry?

I served almost two years on the Sunrise board and have participated fully during that time period. I've been to Medtrade shows; I've been to plants. I've met the people, and I've had substantive discussions as a board member. So I don't come to it as a neophyte by far. As for what I bring to the party, I was involved in a major turnaround situation at the previous company where I was the chairman and CEO. I also have deep experience with other very product-oriented companies. And frankly, I bring a wide experience in both North America and Europe, in terms of actually living and running businesses there.

HC: What drew you to work for Sunrise?

[Sunrise] does need some important changes. I feel that, especially with my background, I bring a unique experience to this position. [Sunrise] is a company that is going through difficult times, in part because of the industry, in part because of some of its own issues. It's a company that deserves a lot better, and I felt that on the board, so I thought that this was a very exciting opportunity.

HC: What is Sunrise's financial status, considering the recently announced decline in income for the second quarter of fiscal 2000?

>From a sales point of view, quarter-to-quarter we increased by about $6 >million, or about 3 to 4 percent. That's encouraging because we've been >experiencing many quarters of quarter-to-quarter declines.

The other more encouraging sign is that the balance sheet's in good shape. The operational cash flow is very positive, and the sale of Sun Med Finance was successfully negotiated and pulled off. The result is that in the first two quarters of this fiscal year, we've reduced debt about a $33 million. With these actions, we're in an excellent position vis-a-vis our balance sheet and debt. In terms of the income statement, it was a disappointment, but it was because of factors that should and will be under our control in the future.

HC: What is the future outlook for Sunrise?

We need to decrease the cycle time of getting new product to the market, and what we need to do in terms of some of our organizational structural costs would imply that changes are going to be made here. How major those will be and under what time period, that's what we as a team need to work out over the next four to five months.

HC: How do you perceive this industry as a whole?

It clearly has been an industry under [financial] pressure over the last few years, and I think the pressure will continue. I think companies like ourselves have to respond to that pressure as opposed to hoping it's going to change. The conventional wisdom is that this pressure may have bottomed out somewhat, and that's probably correct, but the pressure will continue.

From the longer-term point of view, the basic demographics of this industry are very good, and that's one of the exciting things. I don't think we can assume the demographics will be the cavalry coming over the hill to save us during the next 12 to 24 months. But the basic demographics of this business bode well for a company that can position itself from all perspectives-product, customer base, people and cost-and that's what we plan to do.-R.P.