Alvarion Reports Q3 2009 Results
http://www.businesswire.com/news/home/20091103006878/en
TEL AVIV, Israel--(Business Wire)--
Alvarion Ltd. (NASDAQ:ALVR), the world`s leading provider of WiMAX and wireless
broadband solutions, today announced financial results for the third quarter
ended September, 30, 2009.
Business highlights include:
* Selected as vendor to Clearwire International
* Implementing turnkey projects in U.S., Taiwan, Italy and Kenya
* Two new customer wins through expanded NSN partnership
* Introduced outdoor macro base station and WiMAX solution for license exempt
frequencies
Q3 Financial Highlights:
* Returned to Non-GAAP Profitability in Q3 and Year-to-Date Results
* Revenues stable sequentially
* GAAP net loss of ($0.02) per share; Non-GAAP net income of $0.00 per share
* WiMAX shipments down 4% sequentially to $37.5 million, reflecting project
delays
* WiMAX revenues down 10% sequentially to $40.5 million
* Order pattern continues gradual improvement
In the third quarter of 2009, total revenues were $58.4 million, a decrease of
0.6% from $58.7 million in the second quarter of 2009, and a decrease of 21%
from $74.3 million in the third quarter of 2008.
GAAP net loss in the third quarter of 2009 was ($1.0) million, or ($0.02) per
share, compared to net loss of ($4.0) million, or ($0.06) per share in Q2 2009.
GAAP net income in the third quarter of 2008 was $0.8 million, or $0.01 per
share.
Excluding the amortization of intangibles, stock based compensation expenses and
other charges, net, on a non-GAAP basis, the company reported net income in the
third quarter of 2009 of $0.2 million, or $0.00 per diluted share, compared with
non-GAAP net loss of ($0.6) million, or ($0.01) per diluted share in the second
quarter of 2009, and non-GAAP net income of approximately $3.0 million, or $0.05
per diluted share in the third quarter of 2008. Please refer to the accompanying
financial table for reconciliation of GAAP financial information to non-GAAP for
the third quarter of 2009 and the comparative periods.
Cash used in operations was ($4.7) million. As of September 30, 2009, cash, cash
equivalents and investments were $125 million.
Comments from Management
"We achieved non-GAAP breakeven results on approximately the same level of
revenues as the second quarter, as a result of higher gross margin from a
favorable revenue mix combined with our success in improving operating
leverage," said Tzvika Friedman, president and CEO of Alvarion. "Our challenge
in Q3 related mainly to the impact on revenues of regulatory delays in making
spectrum available and the tight credit environment which slowed the pace of
some deployments. Meanwhile, fundamental demand remains robust, the WiMAX
ecosystem is expanding, and operators are experiencing subscriber growth. As a
result, operators` interest in our solution is also growing, and we continue to
be encouraged by the gradual improvement in order intake.
"We expect a similar quarter in Q4, followed by a gradual recovery which is
expected to begin during the first half of 2010 based on improving demand, plus
our ability to reach revenue recognition milestones on projects already won.
Catalysts for improving demand may include easing of tight credit conditions,
new projects funded under the U.S. broadband stimulus program, and WiMAX license
auctions in India. By the end of 2009, the result of streamlining and
simplifying the organization will have taken full effect, bringing our revenue
breakeven level to approximately $58 million. This will position us to benefit
from further operating leverage as revenues improve.
"Longer term, we expect continued growth in demand for WiMAX based on low
broadband penetration in many countries and continuing growth in demand for
data-intensive applications on mobile platforms, aided by additional spectrum
availability and the proliferation of new devices."
Q4 2009 Guidance.
The company`s revenue guidance for Q4 2009 is from $55 to $63 million. Based on
the indicated revenue range, Q4 non-GAAP per share results are expected to range
between a loss of ($0.04) and profit of $0.02. GAAP per share results are
expected to range between a loss of ($0.07) and ($0.01).
Alvarion management will host a conference call today, November 4, at 9:00 a.m.
Eastern time to discuss the quarter.
Please call the following dial in number to participate:
USA: (800) 230-1074; International: +1(612) 332-0820.
The public is invited to listen to the live webcast of the conference call.
For details please visit Alvarion`s website at www.alvarion.com.
An archive of the online broadcast will be available on the website.
A replayof the call will be available from 11:00 a.m. EST on November 4, 2009
through 11:59 p.m. EST on December 4, 2009.
To access the replay, please call:
USA: (800) 475-6701
International: +1(320) 365-3844.
To access the replay, users will need to enter the following code: 117463.
ALVARION LTD. & ITS SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except per share data)
Nine Nine Three Three Three
Months Ended Months Ended Months Ended Months Ended Months Ended
September 30, September 30, September 30, September 30, June 30,
2009 2008 2009 2008 2009
Sales $ 184,998 $ 211,187 $ 58,383 $ 74,279 $ 58,741
Cost of sales 100,252 109,032 30,925 39,098 32,089
Gross profit 84,746 102,155 27,458 35,181 26,652
Operating expenses:
Research and development, net 39,749 45,033 12,330 14,129 12,779
Selling and marketing 39,165 45,612 12,824 16,054 12,970
General and administrative 11,503 14,040 3,757 4,731 3,723
Amortization of intangible assets 99 1,594 33 328 33
Restructuring and other related expenses (*) 919 - - - 919
Total Operating expenses 91,435 106,279 28,944 35,242 30,424
Operating loss (6,689 ) (4,124 ) (1,486 ) (61 ) (3,772 )
Other loss (749 ) - - - (749 )
Financial income, net 1,551 3,514 454 864 518
Net income (loss) (5,887 ) (610 ) (1,032 ) 803 (4,003 )
Basic net earnings (loss) per share: $ (0.09 ) $ (0.01 ) $ (0.02 ) $ 0.01 $ (0.06 )
Weighted average number of shares used in computing basic net earnings (loss) per share 61,999 63,123 62,054 63,170 61,995
Diluted net earnings (loss) per share:
$ (0.09 ) $ (0.01 ) $ (0.02 ) $ 0.01 $ (0.06 )
Weighted average number of shares used in computing diluted net earnings (loss) per share 61,999 63,123 62,054 64,392 61,995
ALVARION LTD. & ITS SUBSIDIARIES
RECONCILIATION BETWEEN GAAP TO NON-GAAP STATEMENT OF INCOME (*)
U.S. dollars in thousands (except per share data)
GAAP Three Non- Three
Months Ended
GAAP
Months Ended
September 30,
June 30, 2009
2009
Non
Adjustments
-GAAP
Sales $ 58,383 $ - 58,383 $ 58,741
Cost of sales 30,925 (93 ) (a) 30,832 31,946
Gross profit 27,458 93 27,551 26,795
Operating expenses:
Research and development, net 12,330 (493 ) (a) 11,837 12,234
Selling and marketing 12,824 (357 ) (a) 12,467 12,464
General and administrative 3,757 (234 ) (a) 3,523 3,220
Amortization of intangible assets 33 (33 ) (b) - -
Total Operating expenses 28,944 (1,117 ) 27,827 27,918
Operating profit (loss) (1,486 ) 1,210 (276 ) (1,123 )
Financial income, net 454 - 454 518
Net income (loss) (1,032 ) 1,210 178 (605 )
Basic net earnings (loss) per share $ (0.02 ) 0.00 $ (0.01 )
Weighted average number of shares used in computing basic net earnings (loss) per share 62,054 62,054 61,995
Diluted net earnings (loss) per share $ (0.02 ) 0.00 $ (0.01 )
Weighted average number of shares used in computing diluted net earnings (loss) per share 62,054 64,605 61,995
(a) The effect of stock-based compensation. The Company adopted the provisions of Statement of Financial Accounting
Standards No. 123(R), "Share-Based Payment" on January 1, 2006 using the modified-prospective transition method.
(b) The effect of amortization of intangible assets.
ALVARION LTD. & ITS SUBSIDIARIES
DISCLOSURE OF NON-US GAAP NET INCOME
FOR COMPARATIVE PURPOSES NET INCOME AND EARNINGS PER SHARE FROM CONTINUING OPERATIONS EXCLUDING AMORTIZATION OF ACQUIRED INTANGIBLES, STOCK BASED COMPENSATION EXPENSES, RESTRUCTURING EXPENSES AND ONE TIME CHARGES
U.S. dollars in thousands (except per share data)
Nine Nine Three Three Three
Months Ended Months Ended Months Ended Months Ended Months Ended
September 30, September 30, September 30, September 30, June 30,
2009 2008 2009 2008 2009
Net income (loss) according to US GAAP $ (5,887 ) $ (610 ) $ (1,032 ) $ 803 $ (4,003 )
Amortization of acquired intangibles 99 1,594 33 328 33
Stock based compensation expenses related to SFAS 123R 4,447 5,772 1,177 1,892 1,697
Restructuring and other related expenses (*) 919 - - - 919
Other loss 749 - - - 749
Net Income (loss) excluding amortization of acquired intangibles, stock based compensation and restructuring expenses $ 327 $ 6,756 $ 178 $ 3,023 $ (605 )
Basic net earnings (loss) per share excluding amortization of acquired intangibles, stock based compensation and restructuring expenses $ 0.01 $ 0.11 $ 0.00 $ 0.05 $ (0.01 )
Weighted average number of shares used in computing basic net earnings (loss) per share 61,999 63,123 62,054 63,170 61,995
Diluted net earnings (loss) per share excluding amortization of acquired intangibles, stock based compensation and restructuring expenses $ 0.01 $ 0.10 $ 0.00 $ 0.05 $ (0.01 )
Weighted average number of shares used in computing diluted net earnings (loss) per share 64,073 64,496 64,605 64,392 61,995
(*) Results of the organizational change performed in April 2009.
ALVARION LTD. & ITS SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands
Sept. 30, June 30,
2009 2009
ASSETS
Cash, cash equivalents, short-term and long-term investments $ 125,294 $ 131,579
Trade receivables 53,330 49,348
Other accounts receivable 10,483 9,805
Inventories 40,153 48,619
Severance pay fund 14,250 12,847
PROPERTY AND EQUIPMENT, NET 17,412 17,686
GOODWILL AND OTHER INTANGIBLE ASSETS 57,273 57,306
TOTAL ASSETS $ 318,195 $ 327,190
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Trade payables $ 35,720 $ 47,281
Other accounts payable and accrued expenses 44,750 46,231
Total current liabilities 80,470 93,512
ACCRUED SEVERANCE PAY 18,616 17,534
TOTAL LIABILITIES 99,086 111,046
SHAREHOLDERS' EQUITY 219,109 216,144
TOTALLIABILITIES AND SHAREHOLDERS' EQUITY $ 318,195 $ 327,190
ALVARION LTD.& ITS SUBSIDIARIES
Consolidated Statement of Cash Flows
U.S. dollars in thousands
Three
Months ended
September 30, 2009
Cash flows from operating activities:
Net loss $ (1,032 )
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation 1,905
Stock based compensation expenses related to SFAS 123R 1,177
Amortization of intangibles assets 33
Increase in trade receivables (3,982 )
Decrease in other accounts receivable and prepaid expenses 2,101
Decrease in inventories 8,466
Decrease in trade payables (11,561 )
Decrease in other accounts payables and accrued expenses (1,481 )
Accrued severance pay, net (321 )
Net cash used in operating activities (4,695 )
Cash flows from investing activities:
Purchase of fixed assets (1,631 )
Net cash used in investing activities (1,631 )
Cash flows from financing activities:
Proceeds from exercise of employees' stock options 41
Net cash provided by financing activities 41
Decrease in cash, cash equivalents, short-term and long-term investments (6,285 )
Cash, cash equivalents, short-term and long-term investments at the beginning of the period 131,579
Cash, cash equivalents, short-term and long-term investments at the end of the period $ 125,294
About Alvarion
Alvarion (NASDAQ: ALVR) is the largest WiMAX pure-player with the most extensive
WiMAX customer base and over 250 commercial deployments around the globe.
Committed to growing the WiMAX market, the company offers solutions for a wide
range of frequency bands supporting a variety of business cases. Through its
OPEN WiMAX strategy, superior IP and OFDMA know-how, and ability to deploy
end-to-end turnkey WiMAX projects, Alvarion is shaping the new wireless
broadband experience (www.alvarion.com).
This press release contains forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These statements are based on the current expectations or beliefs of
Alvarion`s management and are subject to a number of factors and uncertainties
that could cause actual results to differ materially from those described in the
forward-looking statements. The following factors, among others, could cause
actual results to differ materially from those described in the forward-looking
statements: potential impact on our business of the current global recession,
the inability of our customers to obtain credit to purchase our products as a
result of global credit market conditions, the failure to fund projects under
the U.S. broadband stimulus program, continued delays in WiMAX license
allocation in certain countries, the failure of the market for WIMAX products to
develop as anticipated; Alvarion`s inability to capture market share in the
expected growth of the WiMAX market as anticipated, due to, among other things,
competitive reasons or failure to execute in our sales, services provisioning,
marketing or manufacturing objectives; inability to further identify, develop
and achieve success for new products, services and technologies; increased
competition and its effect on pricing, spending, third-party relationships and
revenues; as well as the inability to establish and maintain relationships with
commerce, advertising, marketing, and technology providers, and other risks
detailed from time to time in the Company`s 20-F Annual Report Risk Factors
section as well as in other filings with the Securities and Exchange Commission.
Information set forth in this press release pertaining to third parties has not
been independently verified by Alvarion and is based solely on publicly
available information or on information provided to Alvarion by such third
parties for inclusion in this press release. The web sites appearing in this
press release are not and will not be included or incorporated by reference in
any filing made by Alvarion with the Securities and Exchange Commission, which
this press release will be a part of.
You may request Alvarion's future press releases or a complete Investor Kit by
contacting Kika Stayerman, kika.stayerman@alvarion.com or +972.3.767.4159.
"WiMAX Forum" is a registered trademark of the WiMAX Forum. "WiMAX," the WiMAX
Forum logo, "WiMAX Forum Certified" and the WiMAX Forum Certified logo are
trademarks of the WiMAX Forum.
"Alvarion" and "4Motion" are the registered trademarks of Alvarion Ltd. "OPEN"
is the trademark of Alvarion Ltd.
All other companies' names, products, services may be the properties of their
respective owners.
Alvarion Ltd.
Investor:
Efrat Makov, CFO
+972.3.645.6252
+1.650.314.2652
efrat.makov@alvarion.com
or
Claudia Gatlin, +1.212.830.9080
claudia.gatlin@alvarion.com
Copyright Business Wire 2009
