Avici Systems Reports Third Quarter Results
NORTH BILLERICA, MAass., Oct 23, 2001 (BUSINESS WIRE) -- Avici Systems (Nasdaq: AVCI chart, msgs), a leading provider of scalable and reliable core routing solutions for
the Internet, today reported revenues for its third quarter ended September 30,
2001 of $10.3 million compared to $4.3 million, for the same period last year,
an increase of 135%. Pro forma net loss and pro forma net loss per share
(excluding special one time charges and non-cash equity related charges) for the
three months ended September 30, 2001 were $19.4 million and $0.39 per share,
respectively. Cash, securities and long-term investments totaled $180 million at
September 30, 2001.
"Avici continues to execute and meet customer needs in the midst of a difficult
economic environment," said Steve Kaufman, president and CEO. "This quarter we
introduced the SSR(TM), the industry's first stackable, scalable and
rack-mountable OC-192c router. The SSR is ideal for carriers' regional and metro
PoPs, and thus gives us access to a much broader addressable market. We can now
bring the powerful economic and reliability advantages of our product line to
broader range of carriers, such as Intellispace and Sandia."
Including special one time charges and non-cash equity related charges, net
revenues, net loss and net loss per share for the three months ended September
30, 2001 were $9.5 million, $41.2 million and $0.83 per share, respectively.
The one time charges for the three months ended September 30, 2001 include
provisions totaling $18.3 million for excess inventory and related supplier
commitments resulting from the downturn in current market conditions, as well as
severance, asset utilization and facility related costs associated with the
company's cost reduction initiatives. Non-cash equity based charges for the
three months ended September 30, 2001 related to the amortization of deferred
compensation, $2.7 million and common stock warrant discount, $0.8 million.
To listen to Avici's live Web cast of second quarter results, or to listen to a
replay of the Q3 2001 financial results conference call please visit the Avici
web site at avici.com.
About Avici Systems
Avici Systems Inc., headquartered in North Billerica, Mass., is a leading
provider of purpose-built carrier-class routing solutions for the Internet. Avici's family of routers is designed to meet carrier requirements for the
highest scalability, reliability and network availability, while lowering the total cost of building and operating their networks. The company's routing
systems provide new IP solutions to some of the world's leading service
providers. For more information, please visit us at www.avici.com. Avici, TSR
and SSR are trademarks of Avici Systems Inc.
This release contains information about Avici's future expectations, plans, and
prospects that constitute forward-looking statements for purposes of the safe
harbor provisions under the Private Securities Litigation Reform Act of 1995.
Such forward-looking statements are subject to risks and uncertainties, which
could cause actual results to differ materially from those anticipated. When
used in this press release, the word "will", "expected" and other similar
expressions are intended to identify such forward looking statements.
Such risks and uncertainties include, but are not limited to, market acceptance
of Avici products, services and enhancements, customer purchasing patterns and
commitments, development of the market place, product development and
enhancement, intensity of competition of other vendors, technological changes
and other risks set forth in Avici's filings with the Securities and Exchange
Commission. AVICI SYSTEMS INC.
PROFORMA CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
(unaudited)
Note 1
Three Months Ended Nine Months Ended
September 30, September 30,
2001 2000 2001 2000
Gross revenue $ 10,302 $ 4,356 $ 47,427 $ 7,077
Cost of revenue 7,929 3,137 28,677 5,439
Gross margin 2,373 1,219 18,750 1,638
Operating
expenses:
Research and
development 16,375 14,098 47,344 41,143
Sales and
marketing 4,866 3,482 15,193 7,794
General and
administrative 2,671 1,424 7,493 3,159
Total operating
expenses 23,912 19,004 70,030 52,096
Pro forma loss
from operations (21,539) (17,785) (51,280) (50,458)
Interest income,
net 2,141 3,184 8,592 4,133
Pro forma net
loss $ (19,398)$ (14,601)$ (42,688)$ (46,325)
Pro forma basic
and diluted net
loss per share $ (0.39)$ (0.33)$ (0.87)$ (1.17)
Weighted average
common shares
used in
computing
pro forma
net loss
per share: 49,486,430 44,709,784 49,137,264 39,621,993
Note 1 - The above pro forma consolidated statements of operations for
the three and nine month periods ended September 30, 2001 and
September 30, 2000, are not presented in accordance with generally
accepted accounting principles as they exclude charges for
restructuring, excess inventory and purchased in-process research and
development, as well as certain non-cash charges related to equity
issuances as follows (in thousands):
Three months ended Nine Months Ended
September 30, September 30,
2001 2000 2001 2000
Common stock
warrant discount $ 817 $ -- $ 2,450 $ --
Common stock
warrant expense -- 2,400 2,400
Non-cash stock
based compensation 2,723 6,643 10,861 13,556
Restructuring
charges 1,134 -- 1,134 --
Excess inventory
charge 17,165 -- 17,165 --
Purchased
in-process research
and development -- -- -- 4,000
Total $21,839 $ 9,043 $31,610 $19,956
Additionally, the pro forma weighted average number of common shares
used in the computation of the pro forma net loss per share for the
periods ended September 30, 2000, assumes the inclusion of shares
issueable upon the conversion of redeemable convertible preferred
stock prior to the Company's initial public offering. Such conversion
occurred in connection with the closing of the Company's initial
public offering on August 2, 2000.
AVICI SYSTEMS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
(unaudited)
Three months ended Nine months ended
September 30, September 30,
2001 2000 2001 2000
Gross Revenue $ 10,302 $ 4,356 $ 47,427 $ 7,077
Less - Common stock
warrant discount (817) -- (2,450) --
Net revenue 9,485 4,356 44,977 7,077
Cost of revenue (1) 25,094 3,137 45,842 5,439
Gross margin (15,609) 1,219 (865) 1,638
Operating expenses:
Research and
development (2) 16,375 14,098 47,344 41,143
Sales and
marketing (2) 4,866 3,482 15,193 7,794
General and
administrative (2) 2,671 1,424 7,493 3,159
Stock-based
compensation 2,723 6,643 10,861 13,556
Restructuring
Charges 1,134 -- 1,134 --
Common stock
warrant expense -- 2,400 -- 2,400
Purchased in-process
research and
development -- -- -- 4,000
Total operating
expenses 27,769 28,047 82,025 72,052
Loss from operations (43,378) (26,828) (82,890) (70,414)
Interest income, net 2,141 3,184 8,592 4,133
Net loss $ (41,237)$ (23,644)$ (74,298)$ (66,281)
Net loss per share:
Basic and diluted $ (0.83)$ (0.70)$ (1.51)$ (4.56)
Weighted average
common shares used
in computing net
loss per share:
Basic and diluted 49,486,430 33,944,444 49,137,264 14,521,524
(1) Includes excess
inventory charges $ 17,165 $ -- $ 17,165 $ --
(2) Excludes noncash,
stock-based
compensation,
as follows:
Research and
development $ 1,808 $ 4,153 $ 7,035 $ 9,121
Sales and marketing 690 1,202 2,852 2,437
General and
administrative 225 1,288 974 1,998
$ 2,723 $ 6,643 $ 10,861 $ 13,556
AVICI SYSTEMS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
September 30, December 31,
2001 2000
(unaudited)
Assets
Cash and marketable securities $145,709 $233,392
Inventories 8,640 14,979
Trade accounts receivable 7,611 6,341
Other current assets 3,499 1,766
Total current assets 165,459 256,478
Long term investments 34,131 21,539
Property and equipment, net 41,554 23,780
Other assets 291 291
Total assets $241,435 $302,088
Liabilities and Stockholders' Equity
Accounts payable and
accrued expenses $ 27,383 $ 26,879
Other current liabilities 3,146 4,259
Long term liabilities 934 3,072
Stockholders' equity 209,972 267,878
Total liabilities and
Stockholders' equity $241,435 $302,088
Contact:
Inna Vyadro
Director of Investor Relations
Avici Systems
978-964-2000
ivyadro@avici.com
or
Paul Brauneis
Chief Financial Officer
Avici Systems
978-964-2000
pbrauneis@avici.com |
