Alvarion Ltd. (NASDAQ:ALVR), the world's leading provider of 4G WiMAXâ„¢ and wireless broadband solutions, today announced financial results for the fourth quarter and year ended December, 31, 2009.
Q4 Highlights:
- GAAP operating loss of ($1.3) million; non-GAAP operating profit of $0.6 million
- GAAP net loss of ($0.02) per share; non-GAAP net income of $0.01 per share
- WiMAX revenues up 5% sequentially to $42.7 million
- WiMAX shipments down 9% sequentially to $34.2 million
2009 Highlights (compared to 2008):
- Reduced GAAP operating expenses by 16%; reduced non-GAAP operating expenses by 14%
- GAAP operating loss of ($8.0) million; non-GAAP operating loss of ($0.6) million
- GAAP net loss of ($0.12) per share; non-GAAP net income of $0.01 per share
- WiMAX revenues up 5% to $179 million
- WiMAX shipments down 20% to $152 million
In the fourth quarter of 2009, total revenues were $60.2 million, an increase of 3.1% from $58.4 million in the third quarter of 2009, and a decrease of 14% from $70.1 million in the fourth quarter of 2008.
GAAP net loss in the fourth quarter of 2009 was ($1.3) million, or ($0.02) per share, compared to a net loss of ($1.0) million, or ($0.02) per share in Q3 2009. GAAP net loss in the fourth quarter of 2008 was ($4.8) million, or ($0.08) per share.
Excluding the amortization of intangibles, stock based compensation, restructuring and other charges, net, on a non-GAAP basis, the company reported net income of $0.7 million in the fourth quarter of 2009, or $0.01 per diluted share, compared with non-GAAP net income of $0.2 million, or $0.00 per diluted share in the third quarter of 2009, and non-GAAP net loss of ($0.4) million, or ($0.01) per diluted share in the fourth quarter of 2008.
Please refer to the accompanying financial table for reconciliation of GAAP financial information to non-GAAP for the fourth quarter of 2009 and the comparative periods.
Cash used in operations was ($5.8) million. As of December 31, 2009, cash, cash equivalents and investments totaled $118 million.
Comments from Management
"We are pleased with the increase in WiMAX revenues in 2009 and our ability to deliver a non-GAAP profit in the face of business challenges arising from the worst global economic crisis in a generation," said Eran Gorev, president and CEO of Alvarion. "Throughout the year, operators' interest in deploying WiMAX networks remained robust and the WiMAX ecosystem continued to expand.
"Several important business catalysts expected in Q4, such as the awarding of broadband stimulus funds in the U.S. and the auction of WiMAX spectrum in India, have been delayed and are now expected to materialize during 2010.
"By Q4, there were over 120 WiMAX Forum-certified subscriber devices available. As additional devices are introduced, more spectrum is allocated, new vertical market applications are launched and additional funds are made available to help conquer the digital divide, we believe the future of WiMAX is bright.
"During 2009, we acted decisively to streamline the organization, improve efficiency and lower our breakeven point to position the company to deliver operating leverage as revenues improve. As a result, we achieved a non-GAAP operating profit in Q4.
"Looking ahead, we expect gradual improvement during the second half of 2010 as the tight credit environment starts to ease and some of the business catalysts materialize."
Q1 2010 Guidance
The company's revenue guidance for Q1 2010 is $50 to $60 million. Based on the indicated revenue range, non-GAAP per share results are expected to range between a loss of ($0.07) and profit of $0.01. GAAP per share results are expected to range between a loss of ($0.10) and ($0.02).
Alvarion management will host a conference call today, February 3, at 9:00 a.m. Eastern time to discuss the quarter.
Please call the following dial in number to participate:
USA:
(800) 230-1096; International: +1(612) 332-0107.
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 February 3, 2010 through 11:59 a.m. EST on March 3, 2010.
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: 140419.
Alvarionhas scheduled dates for the earnings announcements during 2010 and this schedule is available on the website at http://www.alvarion.com/index.php/en/investors.
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| ALVARION LTD. & ITS SUBSIDIARIES | |||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||
| U.S. dollars in thousands (except per share data) | |||||||||||||||||
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| Three | Three | Three | |||||||||||||||
| Year Ended | Year Ended | Months Ended | Months Ended | Months Ended | |||||||||||||
| December 31, | Â | Â | December 31, | Â | Â | December 31, | Â | Â | December 31, | Â | September 30, | ||||||
| 2009 | 2008 | 2009 | 2008 | 2009 | |||||||||||||
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| Sales | $ | 245,239 | $ | 281,281 | $ | 60,241 | $ | 70,094 | $ | 58,383 | |||||||
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| Cost of sales | 132,454 | 147,783 | 32,202 | 38,751 | 30,925 | ||||||||||||
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| Gross profit | 112,785 | 133,498 | 28,039 | 31,343 | 27,458 | ||||||||||||
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| Operating expenses: | |||||||||||||||||
| Research and development, net | 50,790 | 59,679 | 10,790 | 14,646 | 12,330 | ||||||||||||
| Selling and marketing | 52,022 | 60,521 | 12,857 | 14,909 | 12,824 | ||||||||||||
| General and administrative | 15,087 | 18,813 | 3,584 | 4,773 | 3,757 | ||||||||||||
| Amortization of intangible assets | 132 | 1,327 | 33 | (267) | 33 | ||||||||||||
| Restructuring and other related expenses (*) | 2,787 | 2,914 | 2,119 | 2,914 | - | ||||||||||||
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| Total Operating expenses | 120,818 | 143,254 | 29,383 | 36,975 | 28,944 | ||||||||||||
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| Operating loss | (8,033) | (9,756) | (1,344) | (5,632) | (1,486) | ||||||||||||
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| Other loss | (823) | - | (74) | - | - | ||||||||||||
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| Financial income, net | 1,668 | 4,297 | 117 | 783 | 454 | ||||||||||||
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| Net income (loss) | (7,188) | (5,459) | (1,301) | (4,849) | (1,032) | ||||||||||||
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| Basic net earnings (loss) per share: | (0.12) | $ | (0.09) | $ | (0.02) | $ | (0.08) | (0.02) | |||||||||
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| Weighted average number of shares used in computing basic net earnings (loss) per share | $ | 62,023 | 62,925 | 62,095 | 62,330 | $ | 62,054 | ||||||||||
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| Diluted net earnings (loss) per share: | (0.12) | $ | (0.09) | $ | (0.02) | $ | (0.08) | (0.02) | |||||||||
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| Weighted average number of shares used in computing diluted net earnings (loss) per share | $ | 62,023 | 62,925 | 62,095 | 62,330 | $ | 62,054 | ||||||||||
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| ALVARION LTD. & ITS SUBSIDIARIES | ||||||||||||||
| RECONCILIATION BETWEEN GAAP TO NON-GAAP STATEMENT OF INCOME | ||||||||||||||
| U.S. dollars in thousands (except per share data) | ||||||||||||||
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| Three | ||||||||||||||
| Three Months Ended | Months Ended | |||||||||||||
| December 31, | September 30, | |||||||||||||
| 2009 | 2009 | |||||||||||||
| GAAP | Adjustments | Â | Non-GAAP | Non-GAAP | ||||||||||
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| Sales | $ | 60,241 | $ | - | 60,241 | $ | 58,383 | |||||||
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| Cost of sales | 32,202 | 32 | (a) | 32,234 | 30,832 | |||||||||
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| Gross profit | 28,039 | (32) | 28,007 | 27,551 | ||||||||||
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| Operating expenses: | ||||||||||||||
| Research and development, net | 10,790 | (10) | (a) | 10,780 | 11,837 | |||||||||
| Selling and marketing | 12,857 | 109 | (a) | 12,966 | 12,467 | |||||||||
| General and administrative | 3,584 | 70 | (a) | 3,654 | 3,523 | |||||||||
| Amortization of intangible assets | 33 | (33) | (b) | - | - | |||||||||
| Restructuring and other related expenses | 2,119 | (2,119) | (c) | - | - | |||||||||
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| Total Operating expenses | 29,383 | (1,983) | 27,400 | 27,827 | ||||||||||
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| Operating profit (loss) | (1,344) | 1,951 | 607 | (276) | ||||||||||
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| Other loss | (74) | 74.00 | 0 | |||||||||||
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| Financial income, net | 117 | - | 117 | 454 | ||||||||||
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| Net income (loss) | (1,301) | 2,025 | 724 | $ | 178 | |||||||||
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| Basic net earnings (loss) per share | (0.02) | 0.01 | 0.00 | |||||||||||
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| Weighted average number of shares used in computing basic net earnings (loss) per share | $ | 62,095 | 62,095 | 62,054 | ||||||||||
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| Diluted net earnings (loss) per share | (0.02) | 0.01 | 0.00 | |||||||||||
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| Weighted average number of shares used in computing diluted net earnings (loss) per share | $ | 62,095 | 64,515 | 64,605 | ||||||||||
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(a) | Â | 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. |
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(b) | The effect of amortization of intangible assets. | |
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(c) | Results of the organizational change and other charges. |
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ALVARION LTD. & ITS SUBSIDIARIES | |||||||||||||||||
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DISCLOSURE OF NON-US GAAP NET INCOME | |||||||||||||||||
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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 | |||||||||||||||||
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| U.S. dollars in thousands (except per share data) | |||||||||||||||||
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| Three | Three | Three | |||||||||||||||
| Year Ended | Year Ended | Months Ended | Months Ended | Months Ended | |||||||||||||
| December 31, | December 31, | December 31, | December 31, | September 30, | |||||||||||||
| 2009 | 2008 | 2009 | 2008 | 2009 | |||||||||||||
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| Net income (loss) according to US GAAP | $ | (7,188) | $ | (5,459) | $ | (1,301) | $ | (4,849) | $ | (1,032) | |||||||
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| Amortization of acquired intangibles | 132 | 1,327 | 33 | (267) | 33 | ||||||||||||
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| Stock based compensation expenses related to SFAS 123R | 4,246 | 7,561 | (201) | 1,789 | 1,177 | ||||||||||||
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| Restructuring and other related expenses (*) | 2,787 | 2,914 | 2,119 | 2,914 | - | ||||||||||||
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| Other loss | 823 | 74 | - | ||||||||||||||
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| Net Income (loss) excluding amortization of acquired intangibles, stock based compensation and restructuring expenses | $ | 800 | $ | 6,343 | $ | 724 | $ | (413) | $ | 178 | |||||||
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| Basic net earnings (loss) per share excluding amortization of acquired intangibles, stock based compensation and restructuring expenses | $ | 0.01 | $ | 0.10 | $ | 0.01 | $ | (0.01) | $ | 0.00 | |||||||
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| Weighted average number of shares used in computing basic net earnings (loss) per share | 62,023 | 62,925 | 62,095 | 62,330 | 62,054 | ||||||||||||
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| Diluted net earnings (loss) per share excluding amortization of acquired intangibles, stock based compensation and restructuring expenses | $ | 0.01 | $ | 0.10 | $ | 0.01 | $ | (0.01) | $ | 0.00 | |||||||
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| Weighted average number of shares used in computing diluted net earnings (loss) per share | 64,184 | 64,143 | 64,515 | 62,330 | 64,605 | ||||||||||||
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| (*) | Â | Results of the organizational change and other charges. |
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| ALVARION LTD. & ITS SUBSIDIARIES | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| U.S. dollars in thousands | ||||||||
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| December 31, | December 31, | |||||||
| 2009 | 2008 | |||||||
| ASSETS | ||||||||
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| Cash, cash equivalents, short-term and long-term investments | $ | 118,474 | $ | 140,630 | ||||
| Trade receivables | 65,490 | 59,814 | ||||||
| Other accounts receivable | 7,241 | 8,110 | ||||||
| Inventories | 35,982 | 53,675 | ||||||
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| INVESTMENT IN AFFILIATES | - | 1,554 | ||||||
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| PROPERTY AND EQUIPMENT, NET | 16,610 | 16,955 | ||||||
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| GOODWILL AND OTHER INTANGIBLE ASSETS | 57,240 | 57,372 | ||||||
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TOTAL ASSETS | $ | 301,037 | $ | 338,110 | ||||
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| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
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| CURRENT LIABILITIES | ||||||||
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| Trade payables | $ | 35,581 | $ | 57,033 | ||||
| Other accounts payable and accrued expenses | 42,203 | 57,111 | ||||||
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Total current liabilities | 77,784 | 114,144 | ||||||
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| LONG TERM LIABILITIES | ||||||||
| Long term employees liabilities | 4,354 | 5,831 | ||||||
| Long term liabilities others | 2,255 | 2,229 | ||||||
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Total long term liabilities | 6,609 | 8,060 | ||||||
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TOTAL LIABILITIES | 84,393 | 122,204 | ||||||
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| SHAREHOLDERS' EQUITY | 216,644 | 215,906 | ||||||
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TOTALLIABILITIES AND SHAREHOLDERS' EQUITY | $ | 301,037 | $ | 338,110 | ||||
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| ALVARION LTD.& ITS SUBSIDIARIES | |||||
| Consolidated Statement of Cash Flows | |||||
| U.S. dollars in thousands | |||||
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| Three | |||||
Months ended | |||||
December 31, 2009 | |||||
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| Cash flows from operating activities: | |||||
| Net loss | $ | (1,301) | |||
| Adjustments to reconcile net loss to net cash provided by operating activities: | |||||
| Depreciation | 1,699 | ||||
| Capital (Gain)/Loss | 267 | ||||
| Stock based compensation expenses related to SFAS 123R | (201) | ||||
| Amortization of intangibles assets | 33 | ||||
| Increase in trade receivables | (12,160) | ||||
| Decrease in other accounts receivable and prepaid expenses | 2,292 | ||||
| Decrease in inventories | 4,171 | ||||
| Decrease in trade payables | (139) | ||||
| Decrease in other accounts payables and accrued expenses | (409) | ||||
| Decrease in long term employees liabilities | (12) | ||||
| Decrease in long term liabilities | (50) | ||||
| Net cash used in operating activities | (5,810) | ||||
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| Cash flows from investing activities: | |||||
| Purchase of fixed assets | (1,164) | ||||
| Net cash used in investing activities | (1,164) | ||||
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| Cash flows from financing activities: | |||||
| Proceeds from exercise of employees' stock options | 154 | ||||
| Net cash provided by financing activities | 154 | ||||
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| Decrease in cash, cash equivalents, short-term and long-term investments | (6,820) | ||||
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| Cash, cash equivalents, short-term and long-term investments at the beginning of the period | 125,294 | ||||
| Cash, cash equivalents, short-term and long-term investments at the end of the period | $ | 118,474 | |||
About Alvarion
Alvarion (NASDAQ:ALVR) is a global leader in 4G wireless communications with the industry's most extensive customer base with hundreds of commercial WiMAX deployments. Alvarion's industry leading solutions enable true open 4G and vertical applications for service providers and enterprises. Through an OPEN WiMAX strategy, superior IP and OFDMA know-how, and ability to deploy large scale end-to-end turnkey networks, Alvarion is delivering the true 4G broadband experience today (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; potential impact on our business of the current global recession;, 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, 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 at kika.stayerman@alvarion.com or +972.3.767.4159.
"WiMAX" is a trademark of the WiMAX Forum.
"Alvarion"
is a registered trademark of Alvarion Ltd. in certain jurisdictions.
All
other companies' names, products, services may be the properties of
their respective owners.
Contacts:
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