8/17...CIEN..Third Quarter Revenue of $233.3 Million, Net Income of $0.19 per Diluted Share
Technological and Market Leadership Confirmed as CIENA Announces Sales of Next-Generation, Intelligent Optical Core Switch, MultiWave CoreDirector
LINTHICUM, Md.--(BUSINESS WIRE)--Aug. 17, 2000-- CIENA Corporation (NASDAQ: CIEN - news) today reported revenue of $233.3 million for its third fiscal quarter ended July 31, 2000. The results represent sequential revenue growth of more than 25 percent over the Company's fiscal second quarter revenue of $185.7 million, and an increase of more than 80 percent as compared to the same period a year ago when the Company reported revenue of $128.8 million.
Net income for the third quarter was $28.2 million, or $0.19 per diluted share. This compares with net income for the previous quarter of $18.4 million, or $0.12 per diluted share. For the same period in fiscal 1999, the Company reported net income of $1.5 million, exclusive of one-time charges, or $0.01 per diluted share. Consensus of First Call estimates for third quarter fiscal 2000 earnings per share was $0.17 per diluted share.
``CIENA's strong sequential growth is the result of a combination of high demand for our industry-leading optical networking products and successful achievement of new levels of manufacturing and operational efficiencies,'' said Patrick Nettles, CIENA president and chief executive officer.
For the nine months ended July 31, 2000, CIENA reported revenue of $571.2 million, an increase of approximately 68 percent over revenue of $340.7 million for the first nine months of 1999. For the first nine months of 2000, net income totaled $55.6 million, or $0.37 per diluted share. This compares with net income of $0.1 million, exclusive of one-time charges, or breakeven, or $0.00 earnings per diluted share for the same period in 1999.(1)
CIENA continues to demonstrate its technological and market leadership, becoming the first in the industry to announce sales of a next-generation, intelligent, optical core switch, its MultiWave CoreDirector(TM). As of the end of its third fiscal quarter, CIENA had recognized revenues from three customers who had accepted MultiWave CoreDirector for deployment. CIENA also disclosed that in addition to those from which it already has taken revenue, seven service providers currently are trialing CoreDirector. With its scalability, flexibility, and advanced networking capabilities, CoreDirector is designed to enable carriers to dramatically reduce the cost of deploying, operating, and scaling optical service networks.
During its fiscal third quarter, CIENA also became the first optical networking equipment vendor to announce the deployment of 10 gigabit per second transmission capability in a metropolitan network application. CIENA's MultiWave Metro(TM) offers features that simplify metropolitan network designs, and is designed to drive down the cost-per-bit in local networks and provide the foundation for simpler, smarter optical networks that offer service providers substantial operational and economic advantages.
Commenting on CIENA's business outlook, CEO Nettles said, ``Demand across our product lines is strong. In addition to contributions from new products like CoreDirector, we expect continued robust sales of our long-distance optical transport products, MultiWave CoreStream(TM) and MultiWave Sentry(TM), and our metropolitan optical transport product, MultiWave Metro.''
``Short-term, we expect our greatest challenges will be the continued scaling of our manufacturing and sales efforts and effectively managing the business in the face of rapid growth,'' said Nettles. ``Based on information available to us today, we believe we'll be able to outperform current consensus expectations for net income and earnings per share for our fourth fiscal quarter.''
``With service providers' capital expenditures and operational costs continuing to outpace revenue and profit growth, there are more compelling reasons than ever before for carriers to move rapidly to deploy flexible, efficient optical networks,'' concluded Nettles. ``New optical service networks that leverage the power of intelligent optical networking will enable carriers to lower capital expenses, reduce operational costs and deliver new, revenue-generating, high-bandwidth optical services. CIENA believes that it is the first vendor to provide all of the optical systems required to build the next-generation Optical Service Network - from optical transport, to optical switching, to service-level network management.''
ABOUT CIENA
CIENA Corporation's market-leading optical networking systems form the core for the new era of networks and services worldwide. CIENA's LightWorks(TM) architecture enables next-generation optical services and changes the fundamental economics of service-provider networks by simplifying the network and reducing the cost to operate it. Additional information about CIENA can be found at ciena.com
NOTE TO CIENA INVESTORS
This press release contains certain forward-looking statements based on current expectations, forecasts and assumptions of CIENA (the Company) that involve risks and uncertainties. Forward-looking statements in this release, including the expectation that MultiWave CoreDirector will enable carriers to dramatically reduce the cost of deploying, operating, and scaling optical service networks, the expectation that MultiWave Metro will drive down the cost-per-bit in local networks and provide the foundation for simpler, smarter optical networks that offer service providers substantial operational and economic advantages; that we will have continued strong sales of MultiWave CoreStream, MultiWave Sentry, MultiWave Metro and MultiWave CoreDirector; that short-term the Company's greatest challenges will be continued scaling of its manufacturing and sales efforts and effectively managing its business in the face of rapid growth; that we believe we'll be able to outperform current consensus expectations for net income and earnings per share for our fourth fiscal quarter are based on information available to the Company as of the date hereof. The Company's actual results could differ materially from those stated or implied in such forward-looking statements, due to risks and uncertainties associated with the Company's business, which include the risk factors disclosed in the Company's Report on Form 10-Q filed with the Securities and Exchange Commission on August 17, 2000. Forward looking statements include statements regarding the Company's expectations, beliefs, intentions or strategies regarding the future and can be identified by forward looking words such as ``anticipate,'' ``believe,'' ``could,'' ``estimate,'' ``expect,'' ``intend,'' ``may,'' ``should,'' ``will,'' and ``would'' or similar words. The Company assumes no obligation to update the information included in this press release, whether as a result of new information, future events or otherwise.
(1) Past financial results have been restated to reflect the consolidated operating results of Lightera Networks, Inc. and Omnia Communications, Inc., acquired by CIENA in pooling transactions on March 31, 1999 and July 1, 1999, respectively. Net income and earnings per share amounts in the attached consolidated statement of operations are inclusive of the effects of merger-related and other one-time charges. All earnings per share amounts represent diluted earnings per share as defined within Statement of Financial Accounting Standards No. 128 (SFAS 128).
(Consolidated Statements of Operations and Consolidated Balance Sheets follow)
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CIENA CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Quarter Ended Nine Months Ended
-------------- -----------------
July 31, July 31, July 31, July 31,
1999 2000 1999 2000
--------- --------- --------- ---------
Revenue $ 128,826 $ 233,268 $ 340,733 $ 571,160
Cost of goods sold 79,361 128,172 216,377 319,380
--------- --------- --------- ---------
Gross profit 49,465 105,096 124,356 251,780
--------- --------- --------- ---------
Operating expenses:
Research and
development 28,402 32,697 74,714 92,404
Selling and
marketing 16,839 24,375 43,539 62,828
General and
administrative 5,433 9,339 16,318 23,386
Merger costs 10,768 -- 13,021 --
--------- --------- --------- ---------
Total operating
expenses 61,442 66,411 147,592 178,618
--------- --------- --------- ---------
Income (loss) from
operations (11,977) 38,685 (23,236) 73,162
Interest and other
income (expense), net 3,692 3,100 10,786 9,503
Interest expense (200) (74) (410) (259)
--------- --------- --------- ---------
Income (loss) before
income taxes (8,485) 41,711 (12,860) 82,406
Provision (benefit)
for income taxes (2,928) 13,556 (4,437) 26,782
--------- --------- --------- ---------
Net income (loss) $ (5,557) $ 28,155 $ (8,423) $ 55,624
========= ========= ========= =========
Basic net income
(loss) per common
share $ (0.04) $ 0.20 $ (0.06) $ 0.40
========= ========= ========= =========
Diluted net income
(loss) per common
share and dilutive
potential common share $ (0.04) $ 0.19 $ (0.06) $ 0.37
========= ========= ========= =========
Weighted average basic
common shares outstanding 133,016 141,129 132,712 139,924
========= ========= ========= =========
Weighted average basic
common and dilutive
potential common
shares outstanding 133,016 149,895 132,712 149,288
========= ========= ========= =========
CIENA CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
(unaudited)
October 31, July 31,
1999 2000
------------ -----------
ASSETS
Current assets:
Cash and
cash
equivalents $143,440 $209,903
Marketable
debt
securities 118,956 34,159
Accounts
receivable,
net 144,348 213,087
Inventories,
net 79,608 108,026
Deferred
income
taxes 25,385 44,291
Prepaid
income
taxes -- 12,723
Prepaid
expenses
and other
21,262 39,481
--------- ---------
Total
current
assets 532,999 661,670
Equipment,
furniture
and
fixtures,
net 125,252 167,872
Goodwill
and other
intangible
assets, net 12,635 9,908
Other assets 6,949 13,140
--------- ---------
Total assets $677,835 $852,590
========= ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current
liabilities:
Accounts
payable $ 34,399 $ 45,883
Accrued
liabilities 58,486 81,804
Income
taxes
payable 8,697 --
Deferred
revenue 2,954 2,788
Other
current
obligations 992 743
--------- ---------
Total
current
liabilities 105,528 131,218
Deferred
income taxes 36,953 36,953
Other
long-term
obligations 4,881 4,919
--------- ---------
Total liabilities 147,362 173,090
--------- ---------
Commitments
and contingencies
Stockholders' equity:
Preferred stock
- par value $.01;
20,000,000 shares
authorized; zero
shares issued and
outstanding -- --
Common stock
- par value $.01;
460,000,000 shares
authorized;
138,187,356 and
141,907,933 shares
issued and outstanding 1,382 1,419
Additional
paid-in capital 360,082 453,618
Notes receivable
from stockholders (210) (30)
Accumulated
other
comprehensive
income (40) (390)
Retained
earnings 169,259 224,883
--------- ---------
Total
stockholders'
equity 530,473 679,500
--------- ---------
Total liabilities
and stockholders'
equity $ 677,835 $ 852,590
=========== ==========
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Contact:
Investor Contacts:
Suzanne DuLong or Jessica Towns
CIENA Corporation
(888) 243-6223
email: ir@ciena.com
OR
Press Contacts:
Denny Bilter or Aaron Graham
CIENA Corporation
(877) 857-7377
email: pr@ciena.com |
