SONUS NETWORKS, INC.
Condensed Consolidated Balance Sheets
(In thousands)
March 31, December 31,
2003 2002
(Unaudited)
Assets
Current assets:
Cash, cash equivalents and marketable
securities $106,236 $111,167
Accounts receivable, net 2,454 2,956
Inventories 11,287 10,776
Other current assets 4,488 3,806
Total current assets 124,465 128,705
Property and equipment, net 9,226 11,174
Goodwill and purchased intangible assets, net 903 1,174
Other assets, net 494 480
$135,088 $141,533
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued expenses $33,840 $37,521
Accrued restructuring expenses 1,513 3,143
Deferred revenue 31,831 29,235
Current portion of long-term obligations 1,527 1,606
Total current liabilities 68,711 71,505
Long-term obligations, less current portion 2,660 3,293
Convertible subordinated notes 10,000 10,000
Stockholders' equity:
Common stock 207 207
Capital in excess of par value 858,514 858,126
Accumulated deficit (802,249) (797,868)
Deferred compensation (2,494) (3,469)
Treasury stock (261) (261)
Total stockholders' equity 53,717 56,735
$135,088 $141,533
SONUS NETWORKS, INC.
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(unaudited)
Three months ended Three months ended
March 31, 2003 December 31, 2002
US Adjustments Non US Adjustments Non
GAAP GAAP GAAP GAAP
Results Results Results Results
(A) (A)
Revenues $16,019 $-- $16,019 $12,660 $-- $12,660
Cost of
revenues:
Write-off
(benefit) of
inventory and
purchase
commitments (735) 735 -- -- -- --
Other cost of
revenues 6,165 -- 6,165 6,298 -- 6,298
Total cost of
revenues 5,430 735 6,165 6,298 -- 6,298
Gross profit 10,589 (735) 9,854 6,362 -- 6,362
Gross
profit % 66.1% 61.5% 50.3% 50.3%
Operating expenses:
Research and
development 7,702 -- 7,702 8,783 -- 8,783
Sales and
marketing 5,274 -- 5,274 5,656 -- 5,656
General and
adminis-
trative 1,080 -- 1,080 539 -- 539
Stock-based
compensation 894 (894) -- 3,841 (3,841) --
Amort. of
goodwill and
purchased
intangible
assets 271 (271) -- 358 (358) --
Write-off of
goodwill and
purchased
intangible
assets -- -- -- 175 (175) --
Restructuring
charges
(benefit), net -- -- -- 16 (16) --
Total operating
expenses 15,221 (1,165) 14,056 19,368 (4,390) 14,978
Loss from
operations (4,632) 430 (4,202) (13,006) 4,390 (8,616)
Interest
expense (130) -- (130) (238) -- (238)
Interest
income 381 -- 381 424 -- 424
Net loss $(4,381) $430 $(3,951) $(12,820) $4,390 $(8,430)
Basic and
diluted
net loss
per share $(0.02) $(0.02) $(0.07) $(0.04)
Shares used
in
computation 198,703 198,703 195,648 195,648
(A) These Adjusted Condensed Consolidated Statements of Operations are
for informational purposes only and are not in accordance with US
generally accepted accounting principles (GAAP). These statements
exclude the impact of the write-off (benefit) of inventory and
purchase commitments, amortization of stock-based compensation,
amortization and write-off of goodwill and purchased intangible
assets and restructuring charges (benefit). Sonus' management uses
the non-GAAP financial results as an alternative means for
assessing our quarterly operations. Even though Sonus' management
recognizes that non-GAAP financial results are not a substitute
for GAAP results, non-GAAP measures are helpful in assisting
Sonus' management understand and manage its business. Please refer
to the section entitled Explanation of Use of Non-GAAP Financial
Results on page 29 of Sonus' Annual Report on Form 10-K, dated
March 19, 2003, which explains in detail the use by Sonus'
management of non-GAAP financial results.
SONUS NETWORKS, INC.
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(unaudited)
Three months ended Three months ended
March 31, 2003 March 31, 2002
US Adjustments Non US Adjustments Non
GAAP GAAP GAAP GAAP
Results Results Results Results
(A) (A)
Revenues $16,019 $-- $16,019 $21,158 $-- $21,158
Cost of
revenues:
Write-off
(benefit)
of inventory
and purchase
commitments (735) 735 -- 9,434 (9,434) --
Other cost
of revenues 6,165 -- 6,165 9,875 -- 9,875
Total cost
of revenues 5,430 735 6,165 19,309 (9,434) 9,875
Gross profit 10,589 (735) 9,854 1,849 9,434 11,283
Gross
profit % 66.1% 61.5% 8.7% 53.3%
Operating expenses:
Research and
development 7,702 -- 7,702 14,615 -- 14,615
Sales and
marketing 5,274 -- 5,274 8,407 -- 8,407
General and
adminis-
trative 1,080 -- 1,080 1,466 -- 1,466
Stock-based
compensation 894 (894) -- 5,743 (5,743) --
Amort. of
goodwill and
purchased
intangible
assets 271 (271) -- 406 (406) --
Restructuring
charges
(benefit), net -- -- -- (12,141) 12,141 --
Total operating
expenses 15,221 (1,165) 14,056 18,496 5,992 24,488
Loss from
operations (4,632) 430 (4,202) (16,647) 3,442 (13,205)
Interest
expense (130) -- (130) (139) -- (139)
Interest
income 381 -- 381 592 -- 592
Net loss $(4,381) $430 $(3,951) $(16,194) $3,442 $(12,752)
Basic and
diluted net
loss
per share $(0.02) $(0.02) $(0.09) $(0.07)
Shares used
in
computation 198,703 198,703 186,057 186,057
(A) These Adjusted Condensed Consolidated Statements of Operations are
for informational purposes only and are not in accordance with US
generally accepted accounting principles (GAAP). These statements
exclude the impact of the write-off (benefit) of inventory and
purchase commitments, amortization of stock-based compensation,
amortization of goodwill and purchased intangible assets and
restructuring charges (benefit). Sonus' management uses the
non-GAAP financial results as an alternative means for assessing
our quarterly operations. Even though Sonus' management recognizes
that non-GAAP financial results are not a substitute for GAAP
results, non-GAAP measures are helpful in assisting Sonus'
management understand and manage its business. Please refer to the
section entitled Explanation of Use of Non-GAAP Financial Results
on page 29 of Sonus' Annual Report on Form 10-K, dated March 19,
2003, which explains in detail the use by Sonus' management of
non-GAAP financial results. |
