TSTN Turnstone Systems Reports First Quarter Results 4/24
Quarterly Revenues Grow to $23 Million; Earnings Per Share of $0.14
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MOUNTAIN VIEW, Calif., April 24 /PRNewswire/ -- Turnstone Systems, Inc. (Nasdaq: TSTN - news), a leading provider of loop management hardware and software products that enable local exchange carriers to rapidly deploy and efficiently maintain digital subscriber line (DSL) services, today announced first quarter results for the period ending March 31, 2000.
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First quarter revenues increased to $23 million, from $1 million in the same period a year earlier and up 85 percent sequentially from $12.5 million in the fourth quarter of fiscal 1999. Net income for the first quarter increased to $4.6 million, or $0.14 per diluted share based on 32 million weighted average shares outstanding, compared to a net loss of $1.2 million or $0.40 per diluted share for the same period a year earlier, and net income of $1.1 million, or $0.04 per diluted share for the fourth quarter of fiscal 1999.
``The first quarter marked a defining period for Turnstone,'' said Rick Tinsley, president and chief executive officer of the company. ``In addition to the successful completion of our initial public offering, we also made significant strides in executing our strategy to establish Turnstone as the leader in digital loop management. At present, more than 25 local exchange carriers have selected Turnstone for DSL loop management.''
In February 2000, Turnstone completed an initial public offering of 3.45 million shares, including 450,000 over-allotment shares. Net proceeds to Turnstone from the offering totaled approximately $92 million. As of March 31, 2000, the company had cash and short-term investments of $112 million, total assets of $124 million and stockholders' equity of $111 million.
About Turnstone Systems
Turnstone Systems, Inc. is a leading provider of hardware and software products that enable local exchange carriers to rapidly deploy and efficiently maintain DSL services. Turnstone's flagship product, the Copper CrossConnect(TM) CX100, is a loop management platform that is deployed in central offices to enable automation and remote control of physical layer tasks related to DSL installation, qualification and maintenance. Turnstone's CrossWorks(TM) software enables service providers to easily integrate these loop management functions into back-office Operational Support Systems (OSS), enhancing their ability to efficiently scale their DSL service offerings to meet ever-increasing demand. Turnstone is based in Mountain View, California. For more information about Turnstone, visit www.turnstone.com, email info@turnstone.com or phone the toll-free number 877.8.COPPER.
TURNSTONE SYSTEMS, INC.
CONDENSED STATEMENTS OF OPERATIONS
(In thousands except per share data)
(Unaudited)
The three months
ended March 31,
2000 1999
Net revenues $23,107 $952
Cost of revenues 8,756 576
Gross profit 14,351 376
Operating expenses:
Research and development
(Exclusive of non-cash
compensation of $29 and
$1,058 in 1999 and 2000,
respectively) 2,728 830
Sales and marketing
(Exclusive of non-cash
compensation of $62 and
$501 in 1999 and 2000,
respectively) 2,078 508
General and administrative
(Exclusive of non-cash
compensation of $6 and
$259 in 1999 and 2000,
respectively) 783 191
Amortization of deferred
stock compensation 1,818 97
Total operating expenses 7,407 1,626
Operating income (loss) 6,944 (1,250)
Interest income (expense) and other, net 918 42
Income (loss) before income tax 7,862 (1,208)
Income tax expense (3,277) --
Net income (loss) 4,585 (1,208)
Basic net earnings/(loss)
per share of common stock $.25 $(.40)
Diluted net earnings/(loss)
per share of common stock $.14 $(.40)
Weighted-average shares of
common stock outstanding
used in computing basic net
earnings/(loss) per share 18,436 3,010
Weighted-average shares of
common stock outstanding
used in computing diluted
net earnings/(loss) per share 31,806 3,010
TURNSTONE SYSTEMS, INC.
CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
March 31, December 31,
2000 1999
Assets
Current assets:
Cash and cash equivalents $91,714 $8,063
Short-term investments 19,905 --
Accounts receivable, net 6,863 6,439
Inventory 3,206 2,939
Prepaid expenses and
other current assets 709 599
Total current assets 122,397 18,040
Property and equipment, net 1,302 1,085
Other assets 132 132
Total assets $123,831 $19,257
Liabilities and stockholder' equity
Current liabilities:
Current obligations
under capital leases $218 $ 229
Accounts payable 2,628 783
Accrued compensation
and benefits 1,081 920
Income tax payable 3,170 --
Customer deposits 2,340 1,328
Other current liabilities
and accrued expenses 709 1,679
Deferred revenue 2,772 2,132
Total current liabilities 12,918 7,071
Long-term obligations
under capital leases,
net of current portion 190 260
Other long-term liabilities 35 35
Total liabilities 13,143 7,366
Stockholders' equity:
Convertible preferred stock -- 15
Common stock, $.001 stated
value, 40,000 shares authorized;
30,155 and 11,407 shares issued
and outstanding at March 31, 2000
and December 31, 1999, respectively 30 11
Additional paid-in capital 123,563 26,547
Deferred stock compensation (12,473) (9,701)
Accumulated other comprehensive loss (36) --
Accumulated deficit (396) (4,981)
Total stockholders' equity 110,688 11,891
Total liabilities and
stockholders' equity $123,831 $19,257
SOURCE: Turnstone Systems, Inc.
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