Q4 & F/Y 1996 results: ( clipped from ascend.com ) I suggest you go to Ascend's site to print out the full release so as to make sense of the numeric columns. Dee Jay
ASCEND COMMUNICATIONS REPORTS 1996 FINANCIAL RESULTS
Alameda, CA, January 16, 1997 -- Ascend Communications, Inc. (NASDAQ - ASND) today reported its financial results for the year ended December 31, 1996. For the year, net sales were $549.3 million and net income was $113.1 million ($0.89 per share). Compared with financial results for the year ended December 31, 1995, sales increased 260%, net income increased 311% and net income per share increased 256%. Net sales and net income for 1995 were $152.6 million
and $27.5 million ($0.25 per share), respectively.
For the fourth quarter ended December 31, 1996, net sales were $177.5 million and net income was $41.1 million ($0.32 per share). Compared with the fourth quarter of 1995, these results represent a 189% increase over net sales of $61.4 million, a 205% increase over net income of $13.5 million and a 191% increase over net income per share of $0.11.
Commenting on the Company's performance for the fourth quarter of 1996, Mory Ejabat, president and chief executive officer of Ascend said "We are very pleased to report continued growth in revenues in the fourth quarter, particularly given that for the quarter we did not record any revenue for our newest products, the MAX TNT and the GRF 400, and in addition during the quarter we announced a 30% price reduction for our Pipeline products." Mr. Ejabat also stated "Customer
interest in the TNT and the GRF 400 is very strong, and we expect that each of these products will contribute to the business in 1997. Full production shipments of the TNT commenced in December, and we expect production shipments of the GRF 400 to commence either late in the first quarter or early in the second quarter of 1997."
Commenting on the Company's performance for the year, Mr. Ejabat said, "We are very pleased to report this growth in revenues and earnings for 1996. In light of the many other accomplishments we
made during the year, successful achievement of our financial objectives as well makes us particularly proud."
Ejabat continued, "In many ways, 1996 was a year of change as well as expansion for the Company. We successfully completed four acquisitions during the year, giving us the technology to
greatly expand our business focus and the market opportunities we address. These acquisitions included Morning Star Technologies, Inc., which we acquired in March. Morning Star provided us with a world class security software solution which we integrated into our MAX and Pipeline products in June. In August we purchased NetStar, Inc., a manufacturer of high speed IP switching products. We announced the first product using NetStar technology, the GRF 400, in September.
The purchase of Subspace Communications, Inc. in August provided us with a cost effective card-level solution for individual PC users' network connectivity. In December we acquired StonyBrook Services, Inc., which will provide us with advanced network management capabilities.
These acquisitions not only broadened the market opportunities we are able to address in the future, but also expanded the quality and breadth of products with which we address our current markets.
We also introduced two major new products during the year, re-defining the way that our customers approach the structure of and access to their backbone networks. The MAX TNT and GRF 400 were both announced in September. The MAX TNT is the newest member of our family of MAX products, providing a compact, high performance and fully integrated solution for larger networks and for various applications in carrier and Internet environments which require the density,
redundancy and hot-swapability of a carrier class product as well as the ability to support both leased and dialed services in a cost effective manner. The GRF 400 is a high-speed IP switch which routes IP traffic at speeds unmatched in the industry. With the GRF product line we address the backbone network needs of Internet providers, carriers and enterprise network managers whose networks are overwhelmed by the quantity and complexity of the growing volumes of IP traffic."
Looking forward to 1997, Ejabat said that the Company will continue to focus on the multitude of opportunities in the remote networking arena. "We have been very successful in addressing the
changing needs of our customer base on an almost real-time basis. Our business is the business of identifying the challenges of rapidly growing networks - in the areas of access, concentration and
backbone infrastructure - and addressing those challenges first with the most technically advanced products on the market. As remote networking markets continue to develop we intend to do more of
the same."
ASCEND COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
UNAUDITED
(IN THOUSANDS, EXCEPT PER SHARE DATA)
QTR. ENDED DEC. 31, YEAR ENDED DEC. 31,
1996 1995 1996 1995
Net Sales $177,491 $61,388 $549,297 $152,604
Cost of Goods Sold 60,987 21,215 192,226 53,295
Gross Profit 116,504 40,173 357,071 99,309
Operating Expenses:
Research and Development 12,652 4,321 40,291 12,401
Sales and Marketing 36,504 13,638 111,599 35,446
General and Administrative 4,534 2,712 16,745 9,130
Purchased R&D - - - 3,032
Costs of Merger - - 13,900 -
Total Operating Expenses 53,690 20,671 182,535 60,009
Operating Income 62,814 19,502 174,536 39,300
Interest Income, Net 3,269 2,203 11,879 5,122
Income Before Income Taxes 66,083 21,705 186,415 44,422
Provision for Income Taxes 24,990 8,248 73,304 16,887
Net Income $41,093 $13,457 $113,111 $27,535
Net Income Per Share $0.32 $0.11 $0.89 $0.25
Number of Shares Used in
Per Share Calculation 130,012 122,274 127,809 111,362
ASCEND COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
UNAUDITED
(IN THOUSANDS)
DEC. 31, DEC. 31,
1996 1995
ASSETS
Cash, Cash Equivalents and
Short-Term Investments $373,151 $237,893
Accounts Receivable, Net 103,145 31,238
Inventories, Net 49,241 26,868
Other Current Assets 46,762 11,778
Total Current Assets 572,299 307,777
Investments 35,771 51,515
Furniture, Fixtures and Equipment, Net 40,034 10,108
Other Assets 3,762 614
TOTAL ASSETS $651,866 $370,014
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts Payable and Accrued Liabilities $104,416 $45,027
Total Current Liabilities 104,416 45,027
Stockholders' Equity:
Common Stock 119 113
Additional Paid In Capital 411,679 301,562
Retained Earnings 135,652 23,312
Total Stockholders' Equity 547,450 324,987
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $651,866 $370,014
This news release contains forward-looking statements that involve risks and uncertainties, including but not limited to quarterly fluctuations in results, the timely availability and customer
acceptance of new products, the impact of competitive products and pricing, general market trends and conditions and other risks detailed in the Company's SEC reports. Actual results may vary materially from projected results.
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