Tuesday January 13, 6:53 am Eastern Time
Company Press Release
Adtran, Inc. Reports Record Fourth Quarter And Year End 1997 Results
HUNTSVILLE, Ala.--(BUSINESS WIRE)--Jan. 13, 1998--ADTRAN, Inc. (NASDAQ: ADTN - news) reported record results for both the
fourth quarter and the year ended December 31, 1997. Sales for the fourth quarter were $74,400,000 compared to sales of $69,936,000 for the
fourth quarter of 1996. In addition, sales for the fourth quarter increased from $70,579,000 in the third quarter of 1997. Although the first half of
1997 was marked by slowness in the telecommunications equipment sector, sales for the year increased to $265,335,000 from $250,121,000 in
1996, continuing the Company's record of achieving increased annual revenues.
Net income for the quarter increased to $12,566,000 ($.32 per share) from $11,451,000 ($.29 per share) in the fourth quarter of 1996. Net
income for the year ended December 31, 1997 increased to $40,209,000 ($1.02 per share) from $39,820,000 ($1.01 per share) in the prior year.
Net income in the fourth quarter increased 12.8% from $11,141,000 ($.28 per share) reported for the third quarter of 1997.
Commenting on the results, Mark C. Smith, Chairman and CEO of ADTRAN, stated, ''We are proud of what we accomplished during the
second half of 1997 and particularly in the fourth quarter. Everyone knows we struggled during the first half as business was slow. However,
our market positions remained intact, we continued our investment in technology, and we continued to develop and strengthen our organization.
Therefore, the return to more normal business patterns in the second half allowed us to show significant improvement. Continued improvement
in revenues and gross margins will enable us to maintain our investment in research and development and the growth of our team. We look
forward to 1998 and believe it will bring continuing increases in the demand for our products.''
Mr. Smith noted several development achievements for the Company during 1997. Among these is ATLAS, the Company's new integrated
access device and its first central site product in the Customer Premises Equipment (CPE) business. Perhaps the most important development
relating to 1997 operating results is the improvement in HDSL technology which allowed ADTRAN to significantly reduce the cost of these
products while enhancing its gross margin percentage. He also noted the achievements of the Company's operations staff in reducing
inventories and improving production processes while reducing lead times.
With respect to markets, Mr. Smith noted that ADTRAN's CPE business grew by 27% during the year while international sales grew to
account for 8.7% of total sales. In the area of product lines, the Telco area was led by HDSL which increased by 9.8% from the third quarter
of 1997 and 30.4% from the fourth quarter of 1996. For the entire year, HDSL increased by 36.1%. In the CPE area, T1 sales increased by
7.2% from the third quarter of 1997 and by 45.3 % from the fourth quarter of 1996. The increase for the year was 44.5%. From the third to the
fourth quarter, ISDN sales declined by 12.2% while 64 kilobit access (DDS/Frame Relay/Other) increased by 17.6%.
ADTRAN, Inc. designs, develops and markets a broad range of high-speed digital transmission products utilized by Telcos, corporate end users
and OEMS to implement digital data service over existing telephone networks.
This press release contains forward-looking statements which reflect management's best judgment based on factors currently known. However,
these statements involve risks and uncertainties including the successful development and market acceptance of new products, the degree of
competition in the market for such products, the product and channel mix, component costs, manufacturing efficiencies, and other risks detailed
in our annual report on Form 10-K for the year ended December 31, 1996 and in our quarterly report on Form 10-Q for the quarter ended
September 30, 1997. Such risks and uncertainties could cause actual results to differ materially from those in the forward-looking statements
included in this press release.
For more information regarding ADTRAN and its products, call 800-326-3700, fax 205-963-8116, or E-Mail: info@adtran.com . ADTRAN can
be found on the internet at www.adtran.com .
Note: All per share amounts included in this press release are calculated assuming dilution in conformity with Statement of Financial Accounting
Standards No. 128 which is effective for ADTRAN for the year ended December 31, 1997.
ADTRAN
Condensed Balance Sheet
December 31, 1997
Unaudited
Assets December 31, 1997
Cash & cash equivalents $45,340,961
Short-term investments 37,833,240
Accounts receivable 40,906,888
Other receivables 343,463
Inventory 39,369,103
Prepaid expenses 3,606,424
------------
Total current assets 167,400,079
Equipment (net) 27,019,367
Land 4,263,104
Bldg. & land improvements (net) 33,518,661
Other assets 200,000
Long-term investments 50,000,000
------------
$282,401,211
============
Liabilities and stockholders' equity
Accounts payable $7,891,163
Accrued salaries 1,927,364
Accrued income taxes 4,579,345
Accrued taxes other than income taxes 180,611
Warranty payable 1,435,259
Accrued vacation 972,651
Interest payable 0
Other payables 1,230,107
------------
Total current liabilities 18,216,500
Long-term liabilities 52,147,635
------------
Total liabilities 70,364,135
Stockholders' equity 212,037,076
------------
$282,401,211
============
ADTRAN
Condensed Statements of Income
For the quarters ending 12/31/97 and 12/31/96
Unaudited
Fourth Fourth
Quarter Quarter
1997 1996
----- -----
Sales $74,400,401 $69,636,498
Cost of sales 35,860,844 34,583,219
----------- -----------
Gross profit 38,539,557 35,053,279
Selling, general and administrative
expenses 12,319,673 10,831,595
Research & development expenses 7,493,905 6,750,319
----------- -----------
Profit from operations 18,725,979 17,471,365
Interest expense (566,165) (228,190)
Other income (primarily interest) 1,474,699 1,462,402
----------- -----------
Income before income taxes 19,634,513 18,705,577
Provision for income taxes (7,068,323) (7,254,838)
----------- -----------
Net income $12,566,190 $11,450,739
=========== ===========
Weighted average shares outstanding
assuming dilution (1) 39,640,976 39,557,802
=========== ===========
Earnings per common share assuming
dilution (1) $0.32 $0.29
===== =====
Earnings per common share $0.32 $0.30
===== =====
(1) Assumes exercise of dilutive stock options calculated under the
treasury stock method.
ADTRAN
Condensed Statements of Income
For the periods ended December 31, 1997 and
December 31, 1996
Unaudited
For the Year For the Year
Ended Ended
Dec. 31, 1997 Dec. 31, 1996
-------------- --------------
Sales $265,334,768 $250,120,836
Cost of sales 130,253,531 129,953,371
----------- ------------
Gross profit 135,081,237 120,167,465
Selling, general and administrative
expenses 44,973,175 34,308,436
Research & development expenses 30,055,091 24,647,425
----------- ------------
Profit from operations 60,052,971 61,211,604
Interest expense (1,838,814) (894,657)
Other income (primarily interest) 4,612,671 3,184,849
----------- ------------
Income before income taxes 62,826,828 63,501,796
Provision for income taxes (22,617,556) (23,681,892)
------------ ------------
Net income $40,209,272 $39,819,904
=========== ============
Weighted average shares outstanding
assuming dilution(1) 39,565,497 39,566,090
=========== ============
Earnings per common share assuming
dilution (1) $1.02 $1.01
===== =====
Earnings per common share $1.03 $1.03
===== =====
(1) Assumes exercise of dilutive stock options calculated under the
treasury stock method. |
