SMRA - looks solid, Revs. $90M, gross profit $34M, Net $20M. This is a buy and hold!
SOMERA COMMUNICATIONS INC (SMRA)
S-1 Filing (SEC form S1)
We provide telecommunications carriers with a broad range of infrastructure equipment and related services designed to meet
their specific and changing equipment needs. We offer our customers a unique combination of new, de- installed and
refurbished equipment from a variety of manufacturers, allowing them to make multi-vendor purchases from a single,
cost-effective source. To further address our customers' dynamic equipment needs, we offer a suite of customized,
value-added services, including asset recovery, inventory management, technical support and other ancillary services. We sell
equipment to over 750 customers, including leading carriers such as ALLTEL Corporation, AT&T Corporation,
McLeodUSA, Inc., Sprint Corporation, United States Cellular Corp. and Vodafone AirTouch plc. For the twelve months
ended June 30, 1999, we had net revenue of $90.6 million, gross profit of $34.5 million and net income of $20.7 million.
The telecommunications infrastructure equipment market has experienced tremendous growth in recent years. Dataquest
projects that worldwide sales of telecommunications infrastructure equipment will grow from $180 billion in 1998 to $230
billion in 2002. Telecommunications carriers are facing a number of challenges, including increased competition, the need to
rapidly expand service offerings, increased demand for communications services and technology advancements. These
challenges are having a significant impact on carriers' equipment and service needs. Carriers have invested hundreds of billions
of dollars in telecommunications network infrastructure. To maximize the value of their investments, carriers are expanding and
upgrading their existing networks and utilizing existing and new technologies and equipment from multiple vendors. In addition,
carriers are seeking cost-effective ways to expand and maintain existing elements of their networks based on mature
technologies. A significant portion of the equipment replaced by carriers, referred to as de- installed equipment, is suitable for
redeployment in other parts of a carrier's network. While historically carriers may have scrapped de-installed equipment or let it
remain idle, competitive factors increasingly require carriers to recapture a portion of their original investment. As they attempt
to respond to their changing equipment and service needs, carriers are discovering that traditional equipment suppliers, including
original equipment manufacturers, or OEMs, distributors and niche secondary market dealers are unable to fulfill their complex
and changing equipment needs.
Our innovative equipment and service offerings are delivered through our team of 75 sales and procurement professionals, who
work individually with carriers to understand, anticipate and meet their ongoing equipment requirements. Our sales teams utilize
our relationship management database, our selective inventory and our distribution center to provide our customers with rapidly
deployable equipment solutions.
The key benefits of our solution include:
. Broad Multi-vendor Equipment Offering. We provide customers with an effective alternative to traditional telecommunications
equipment supply channels by offering a broad range of new, de-installed and refurbished equipment from a variety of
manufacturers. We offer infrastructure equipment, including switching, transmission, access, wireless, microwave and power
products.
. Rapid Responsiveness to Dynamic Customer Needs. We provide carriers with convenient access to our skilled and dedicated
sales and service professionals who are capable of quickly identifying and responding to their diverse equipment needs. We are
able to quickly locate and provide equipment to carriers by using our relationship management database and maintaining
selective inventory.
. Flexible Asset Recovery Programs. We provide innovative and effective asset recovery programs that enable carriers to
cost-effectively build, upgrade and maintain their networks and to recapture value from their excess and de-installed equipment.
. Simplified, Value-added Materials Management Services. We provide carriers with a full range of value-added services,
including technical, materials management and other network deployment services that simplifies the management of their
equipment inventory and allows them to focus more on their core business.
Our objective is to be the premier provider of telecommunications infrastructure equipment and related services to carriers
worldwide. Key elements of our strategy include:
. Expanding our penetration of the telecommunications carrier market;
. Expanding our product lines and service capabilities;
. Increasing our penetration into the regional bell operating companies, or
RBOCs;
. Pursuing opportunities for international growth; and
. Pursuing selective acquisitions. |
