Looks very solid:
Harris Stratex Networks Reports Q4 and Year-End Fiscal 2007 Financial Results
Fourth quarter revenue increased to $174 million driven by strength in North America and International markets
RESEARCH TRIANGLE PARK, N.C., Aug 7 /PRNewswire-FirstCall/ -- Harris Stratex Networks, Inc. (Nasdaq: HSTX), the leading independent supplier of turnkey wireless network solutions, today reported financial results for the fourth quarter and full year of fiscal 2007, which ended June 29, 2007.
On January 26, 2007, the Harris Microwave Communications Division was combined with Stratex Networks, Inc. to create a new company - Harris Stratex Networks, Inc.
Revenue for the fourth quarter of fiscal 2007 was $174.1 million. GAAP net loss was $5.3 million or $0.09 per share, which includes $23.9 million in pre- tax charges associated with the merger transaction, integration and stock compensation expense.
Non-GAAP Financial Results
For comparative purposes, Harris Stratex Networks has provided pro forma, non-GAAP financial information related to revenue and income as if the former Stratex Networks and the former Harris Microwave Communications Division had been combined since the beginning of fiscal 2006. On this basis, revenue for the fourth quarter of fiscal 2007 increased by 19 percent compared with $146.8 million in the prior quarter, and decreased slightly from $176.8 million in the year ago quarter. Non-GAAP net income for the fourth fiscal quarter of 2007 was $10.3 million or $0.18 per diluted share compared with $3.7 million or $0.06 per diluted share in the prior quarter and $10.3 million in the prior-year quarter.
A reconciliation of GAAP to non-GAAP financial measures is provided on Table 4 along with the accompanying notes.
By segment, North America microwave posted another strong quarter. Revenue increased 20 percent sequentially and 30 percent compared to the prior-year quarter, reflecting continued market strength in both the U.S. and Canada. This was driven by leased-line substitution, mobile network footprint expansion, funding for homeland security initiatives and some initial microwave relocation spending as a result of the Advanced Wireless Services (AWS) auction. International microwave segment revenue increased 20 percent sequentially as orders and project activity with key customers in Africa, Europe, the Middle East, Russia and Asia Pacific improved substantially. International revenue declined by 13 percent compared to a very strong prior- year quarter. Revenue in the Network Operations segment of the business declined 10 percent sequentially but increased 7 percent from the prior-year quarter.
Non-GAAP gross margins were 32 percent in the fiscal 2007 fourth quarter compared with 30 percent in the prior quarter, with improvement driven by mix and product cost reduction synergy actions. Non-GAAP operating income was $13.8 million in the fourth quarter of fiscal 2007, improving sequentially from $5.6 million in the third quarter. These improvements were partially offset by higher operating costs.
'Our efforts to expand revenue were successful in our fourth quarter, with a sequential increase of 19 percent,' said Guy Campbell, president and chief executive officer of Harris Stratex Networks. 'Customer orders in Q4 also increased sequentially, positioning us well as we enter the new fiscal year. Our ability to serve our customers with turnkey wireless transmission solutions is evident in the size of our contracts. Since we last reported earnings, we have announced a North America contract of over $28 million with the Commonwealth of Kentucky and contracts with two major African operators totaling over $30 million.'
In June, the company took a major step to further bolster its international business when it opened its international headquarters (IHQ) in Singapore. 'This location will enable us to better serve our customers outside of North America, improve our logistics and supply chain functions and expand our R&D activities focused on software development. We are also seeing substantial improvements in our Asia Pacific orders and revenue, further validating our decision to open the IHQ,' said Campbell.
'Mobile network expansion continues to provide the greatest opportunity for Harris Stratex Networks. As the clear technology leader, we will continue to offer innovative products that exceed the needs of our global customer base and that build upon the industry-leading Eclipse(TM) and TRuepoint(R) platforms. The trend to IP, or Internet Protocol, is accelerating and our product portfolio is well positioned to capture opportunities for high capacity backhaul and IP transport,' said Campbell. 'We see further market investment in IP and have aligned our technology solutions to take advantage of this future growth.'
Outlook and Guidance
'In fiscal year 2008, we continue to expect revenue to range between $670 million and $702 million and non-GAAP earnings per diluted share of $1.05 to $1.22,' said Campbell. 'The leadership team is completely focused on delivering the financial performance we have set forth for the company in fiscal year 2008.'
Conference Call
Harris Stratex Networks will host a conference call today to discuss the company's financial results at 5:30 p.m. Eastern Time. Those wishing to join the call should dial 303-262-2141, (no pass code required) at approximately 5:20 p.m. A replay of the call will be available starting one hour after the call's completion until August 14. To access the replay, dial 303-590-3000 (pass code: 11092904 #). A live and archived webcast of the conference call will also be available via the company's Web site at www.HarrisStratex.com/investors/conference-call.
Non-GAAP Measures and Comparative Financial Information
Tables reconciling financial results for the Microwave Communications Division of Harris Corporation and Stratex Networks for each quarter of fiscal 2006 and the first two quarters of fiscal 2007 are posted on the investor relation page of the company Web site at www.HarrisStratex.com. |
