Another "take" on JDSU's earnings:
Thursday October 26 6:49 PM ET
JDS Beats Expectations, Lifts Forecast
By Susan Taylor
OTTAWA (Reuters) - JDS Uniphase Corp. (Toronto:JDU.TO - news) (NasdaqNM:JDSU - news) reported first-quarter net earnings on Thursday that came in 2 cents above analysts' expectations and lifted growth forecasts, a performance that could help ease market worries about a slowdown in the red-hot fiber-optics sector.
The results from JDS Uniphase, the world's largest supplier of components that boost capacity and speed on fiber-optic telecoms networks, were seen as an important indicator of the market's health.
``We feel that perhaps we have contributed a little bit of peace to the turbulence that is out there in the market,'' said chief executive Jozef Straus in an interview with Reuters. ``I feel our contribution was quite positive.''
In after-hours trade on Instinet, the stock was at $82 on a volume of 3 million shares, up from a close of $74-7/16.
The company, which said first-quarter sales surged 171 percent over last year, also lifted its second quarter adjusted earnings forecast to 19 or 20 cents per share from 17 cents.
Chief financial officer Anthony Muller also said during a conference call with analysts on Thursday after the market close that revenue should grow in the high teen percentage range from the first to the second quarter.
The company expects 2001 revenues will be 115 to 120 percent over the $1.77 billion pro forma revenues in 2000, which includes revenues from recently acquired E-Tek Dynamics.
Analysts heaped praise on the company during the conference call, reacting to a rare bit of good news in recent days.
``Twenty-three percent quarter-on-quarter growth is good and more importantly their telecommunications business, which is what we care about, grew 26 percent quarter-on-quarter,'' said Arun Veerappan, components analyst at Robertson Stephens Inc.
``And they indicated that revenues could grow in high teens on a sequential basis, so probably 17 to 18 percent quarter-to-quarter...I was expecting 10 percent plus.''
JDS reported first-quarter pro forma net income of $177 million, or 18 cents a share, on revenues of $786 million.
In the year-earlier quarter it posted pro forma net earnings of $65 million, or 8 cents a share, on revenues of $290 million.
The results include revenues from E-Tek Dynamics, which JDS Uniphase acquired in June.
On average, 27 analysts polled by First Call/Thomson Financial had expected net earnings of 16 cents a share, representing estimates 15 cents to 16 cents.
In its last four quarters, JDS Uniphase has bettered consensus estimates by 1 cent three times, and beat consensus by 2 cents once, said First Call/Thomson Financial.
The research firm said four analysts expected first-quarter revenues of $755 million, based on estimates ranging from $747 million to $760 million.
Including merger and other one-time charges, JDS Uniphase reported a loss of $1 billion, or $1.07 per share.
Fiber-optics-related stocks have plunged after Nortel Networks Corp. (Toronto:NT.TO - news), the world's No. 1 supplier of fiber-optic network systems and a major JDS Uniphase customer, surprised analysts on Tuesday by saying its third-quarter sales had declined from the second quarter.
That discouraging news came one day after Lucent Technologies Inc. (NYSE:LU - news) said its fourth-quarter fiber-optic sales also declined.
Together, Lucent and Nortel represented about 36 percent of JDS Uniphase revenues in its last quarter. They now represent 10 percent of sales, as does French telecoms maker Alcatel (CGEP.PA)
``Clearly there is a diversification right there,'' said Veerappun. ``I think this is actually going to help provide some comfort level in optical component stocks.''
JDS Uniphase executives stressed throughout the conference call with analysts that they saw no signs that demand was slipping, but rather growing.
``There is more opportunity now than ever before for JDS Unpihase,'' said Straus. He added that optical technology is just now entering the city markets, amid flourishing construction of long-haul communication networks.
``Demand continues to be strong and our strategy to expand our manufacturing base will continue to ensure we serve our existing customers and new entrants,'' Straus said.
The company said it is on target to increase manufacturing capacity by four times over each 18 month period.
Fiber optics is the science of sending data as light pulses rather than as electrical signals, technology that offers advantages of higher capacity and speed through hair-thin glass fibers rather than traditional copper networks.
Optical systems are increasingly being purchased by phone companies and Internet service providers to carry the massive quantities of data fueled by the Internet. JDS Uniphase sells filters and pump lasers that are used in optical systems.
JDS Uniphase said 29 percent of its sales derived from active components, which push large quantities of data along networks. Passive components, which boost network capacity, represented 60 percent of sales, and boomed largely due to recent acquisitions.
Other non-telecom business represented 11 percent of revenues.
($1-$1.52 Canadian)
Source: dailynews.yahoo.com |
