Wednesday October 14, 8:31 am Eastern Time
Company Press Release
SOURCE: Orckit Communications Ltd.
Orckit Reports Third Quarter
Revenues Increase 89 Percent
TEL AVIV, Israel, Oct. 14 /PRNewswire/ -- Orckit Communications Ltd. (Nasdaq: ORCTF -
news), today reported that revenues for the quarter ended September 30, 1998 increased 89
percent to $13.6 million, compared to $7.2 million for the third quarter of 1997.
Revenues for the nine months ended September 30, 1998 increased 55 percent to $31.1 million,
compared to $20.1 million for the same period in 1997.
Net loss for the third quarter was $4.6 million, or $0.27 per share, against a net income of $0.1
million, or $0.01 per share, during the third quarter of 1997. The net loss for the nine months ended
September 30, 1998 was $9.8 million, or a loss of 0.63 per share, compared with a loss of $0.68
million, or $0.05 per share, for the same period in 1997.
Revenues from ADSL products rose 136 percent in the quarter ended September 30, 1998,
compared to the quarter ended June 30, 1998. During the quarter, the Company continued to
deliver its ADSL DSLAM products to US accounts (together with Fujitsu Network
Communications), and European accounts.
During the quarter, Deutsche Telekom AG [NYSE:DT - news] selected Orckit, together with its
partner Fujitsu Limited, to provide commercial quantities of Orckit's ATM FastInternet(TM)
DSLAM. Deutsche Telekom plans to deploy 70,000 ADSL lines in 43 local networks throughout
Germany by 1999, of which Orckit was awarded a minimum quantity of 35,000 ADSL lines.
''Deutsche Telekom's selection of Orckit together with Fujitsu as a major ADSL supplier further
establishes our leadership in the field of Digital Subscriber Line solutions,'' said Mr. Izhak Tamir,
President of Orckit. ''We are supplying ADSL equipment to two of the largest commercial
deployments in the world. The GTE contract highlighted our advanced capabilities in the areas of
Frame Relay and IP networks, and this new Deutsche Telekom win emphasizes our strong
competence in ATM networks, thus covering the full range of DSLAM networks.''
The Company signed agreements during the quarter with two test equipment vendors, Fluke
Corporation and TTC, to provide customized testers that are interoperable with Orckit's ADSL
products. ''In parallel with Orckit's increasing DSLAM deliveries, these testers will enable our
customers to quickly install our ADSL products, reducing their overall cost of ADSL service
deployment,'' said Mr. Tamir.
During the quarter, The Company started selling HDSL products to SPT TELECOM, a.s., the
national telecommunication operator of the Czech Republic.
Orckit Communications is a leading company in the field of Digital Subscriber Line (DSL)
solutions, which enable telephone companies and Internet Service Providers to optimize the
bandwidth utilization of the ''last mile'' of copper wire in the Local Loop. Orckit possesses both
core silicon expertise and a wide range of DSL products, including its FastInternet(TM) DSLAM
System with ADSL, and its CopperTrunk(R) HDSL and VDSL product lines. Orckit has key
strategic alliances with several leading semiconductor companies and telecom equipment providers.
For more information about Orckit and its DSL solutions, visit Orckit's web site at
orckit.com.
Certain matters discussed in this news release are forward-looking statements that involve a
number of risks and uncertainties including, but not limited to, risks in product development plans
and schedules, rapid technological change, changes and delays in product approval and
introduction, customer acceptance of new products, the impact of competitive products and
pricing, market acceptance, the lengthy sales cycle, proprietary rights of the Company and its
competitors, risk of operations in Israel, government regulation, dependence on third parties to
manufacture products, general economic conditions and other risk factors detailed in the
Company's United States Securities and Exchange Commission filings.
ORCKIT COMMUNICATIONS LTD.
CONSOLIDATED BALANCE SHEETS
(in thousands)
September 30 December 31
1998 1997
(Unaudited) (Audited)
ASSETS
Current assets:
Cash and cash equivalents $13,941 $ 4,130
Short-term investments 33,907 26,100
Trade receivables 8,290 6,008
Other receivables 4,824 2,567
Inventories 16,447 7,144
Total current assets 77,409 45,949
Property and equipment, net 3,099 1,839
Total assets $80,508 $ 47,788
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term bank credit $110
Trade payable $ 13,002 4,240
Accrued expenses and other 4,098 3,597
Total current liabilities 17,100 7,947
Accrued severance pay, net 363 225
Total liabilities 17,463 8,172
Shareholders' equity:
Share capital 525 466
Additional paid-in capital 78,133 44,955
Accumulated deficit (15,613) (5,805)
Total shareholder's equity 63,045 39,616
Total liabilities and
shareholder's equity $80,508 $ 47,788
ORCKIT COMMUNICATIONS LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30 September 30
1998 1997 1998 1997
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenues $ 13,629 $7,212 31,090 $20,107
Cost of revenues 13,602 4,460 27,961 12,847
Gross profit 27 2,752 3,129 7,260
Research and development
expenses 3,503 2,016 8,916 4,880
Less - grants 1,077 866 2,531 1,367
Research and development
expenses, net 2,426 1,150 6,385 3,513
Selling, general and
administrative expenses2,977 1,922 7,947 5,496
Operations loss (5,376) (320) (11,203) (1,749)
Financial income, net 783 428 1,394 1,069
Net income (loss) $(4,593) $108 $(9,809) $(680)
Net income (loss) per share -
basic and diluted $ (0.27) $0.01 $(0.63) $(0.05)
Weighted average number
of shares outstanding 16,801 14,466 15,512 14,362
SOURCE: Orckit Communications Ltd. |
