Pat here is what I like what they started to serve: the new NN:
Even though i "The first quarter's actually our lightest quarter,"
Revenue for the quarter was $495 million, a record for the Company,
it all boils down to our fundamental product lines growing rapidly."
"the industry's best selling ATM system, the MainStreetXpress(TM) 36170 Multiservices Switch . Sales of the 36170 switch were more than double,
that of the previous year's first quarter, as the platform continues to capture market share, biz.yahoo.com
growing at approximately twice the annual growth rate for the overall ATM WAN market.
The market is also waiting on Newbridge to unveil details of its Internet strategy, but Lutz would
say only that an announcement was imminent. The firm has hinted it will soon announce
investments in firms that develop Internet equipment. "I'm going to smile like a demure young
maiden and make people wait for a little bit," Lutz told Reuters.
"We're going to tantalize here, but
you'll have a story shortly."
And in article #2 below:
" NN paid $9.7 million for its 1.7 million Juniper shares, an investment now worth about $352 million.
Those paper gains are in addition to a cash balance which stood at $879.6 million at the close of
the fourth quarter.
What I like the most now is that there is a new awreness in the big telcos that it is critical that there be no outages. I think people will start to look closer to Nn and mot
be drowned by sales pitchs from LU or CSCO.
Looks excitg, as more and more customers hook up to the web,
TA
============================================
marketwatch.newsalert.com
FOCUS-Newbridge breezes by expectations
Reuters Story - August 24, 1999 19:10
(Recasts, adds details)
By Susan Taylor
OTTAWA, Aug 24 (Reuters) - Newbridge Networks Corp. squeaked by expectations with its
first-quarter results released on Tuesday, beating consensus estimates of 18 U.S. cents per share
by 2 U.S. cents.
But analysts said they have more work to do before they could get back in the investment
community's good books.
The Ottawa-area based networking firm reported a profit of C$47 million, or 26 Canadian cents
per share, for the quarter ended August 1, compared to a profit of C$35 million, or 20 Canadian
cents per share last year. Sales of C$495 million were up from C$426 million.
Both First Call/Thomson Financial and IBES International had posted consensus estimates of 16
U.S. cents per share.
"We're higher in revenue and higher in earnings than analysts expected," President Alan Lutz told
Reuters. "Quite honestly, it all boils down to our fundamental product lines growing rapidly."
Record revenue was boosted largely by a 12 percent gain over the previous quarter for the firm's
wide area network technology, which recorded sales of C$357 million.
That revenue, 72 percent of total sales, includes a 16 percent sequential increase in sales for
Newbridge's flagship asynchronous transfer mode (ATM) technology, which sends multimedia
signals over telecommunications networks at high speeds.
Cost control also helped boost the results, as expenses rose just C$3 million over the previous
quarter to C$209 million despite a C$12 million increase in payroll following a corporate-wide
salary review. R&D costs increased just marginally to C$67.6 million.
i "The first quarter's actually our lightest quarter," iLutz said. "It's really nice to hit the ball this way."
Still, Lutz told analysts on a conference call on Tuesday evening thati he wanted to be
conservative and suggested they not upgrade estimates.i First Call/Thomson Financial consensus
for the second quarter is 22 U.S. cents per share, followed by 26 U.S. cents and 31 U.S. cents
per share for the third and fourth quarters.
The market is watching Newbridge's performance closely after the firm issued profit warnings in
five of its last eight quarters.
The first-quarter results take the firm a step closer to credibility, but more work remains, said one
analyst.
"It's good, but it's not a blowout. They need to do two more of these quarters before the
investment community trusts them again," said Paul Sagawa, analyst at Sanford C. Bernstein in
New York. He added revenue came in a shade under his expectations.
"One quarter does not get them back. They dug themselves a substantial hole. It's a lot to ask
investors to forgive and forget," he said. A significant backlog of orders that Newbridge couldn't
fill in last quarter helped boost this set of results. The firm's book-to-bill ratio stands at about one.
Production has been largely overhauled, Lutz said, and the company does not expect to miss any
orders in the future. "We haven't solved everything, but we've solved all the important things,"
Lutz said.
The market is also waiting on Newbridge to unveil details of its Internet strategy, but Lutz would
say only that an announcement was imminent. The firm has hinted it will soon announce
investments in firms that develop Internet equipment. "I'm going to smile like a demure young
maiden and make people wait for a little bit," Lutz told Reuters. i"We're going to tantalize here, but
you'll have a story shortly." i
Newbridge shares closed at C$40.95 on the Toronto Stock Exchange on Tuesday before the
results were released, a gain of C$1.45. On the Nasdaq, the issue gained $1.31 to close at $27.56
($1=$1.49 Canadian)
================================================================
Newbridge hints acquisitions in the wings
Reuters Story - August 23, 1999 14:05
(All figures in U.S. dollars)
By Susan Taylor
OTTAWA, Aug 23 (Reuters) - Networking company Newbridge Networks Corp. is hinting it will
soon unveil investments in firms developing Internet equipment, but analysts aren't holding their
breath.
Ottawa-area based Newbridge, which sells telecommunications equipment, said it will detail plans
to push into the Internet market in two announcements between now and the end of September.
Newbridge is releasing its first-quarter results on Tuesday and will hold its annual general meeting
in Ottawa on September 23.
Newbridge is known for its asynchronous transfer mode (ATM) technology, which sends
multimedia signals over telecommunications lines at high speeds.
But last year, the company said it would branch out with tools that transmit those signals using the
Internet Protocol. The company restructured last July into three business units for switching,
access and Internet products.
"The strategy has been in place for some time and elements of the strategy, building blocks, are
coming together," said Newbridge spokesman John Lawlor.
"Our IP strategy involves both internal development -- we do have something in the neighborhood
of 350 people within our inter-networking products group -- and it also involves acquisitions as
well."
Analysts who follow the firm have been awaiting details that will show where Newbridge's
Internet development efforts stand in contrast to such competitors as Cisco Systems Inc. , Lucent
Technologies Inc. and Nortel Networks Corp.
"Frankly the Internet strategy is a show-me story," said Patrick Houghton, analyst at Sutro & Co.
in San Francisco.
Mark Lucey, analyst at Kearns Capital in Toronto, agreed that the market wants concrete news.
"People have been expecting there would be some acquisition...to put meat on the bones of that
strategy."
Newbridge is expected to either purchase or boost its investments in Boston-area affiliate firms
Ironbridge Networks Inc. and Northchurch Communications Inc. Those companies develop
high-speed routers.
Both are considered front runners in Newbridge's plans, said Michael Cristinziano, analyst at
Gerard Klauer Mattison in New York.
"What I'd like to see would be them announcing they're farther ahead on their development than
anybody expected and maybe there's a customer who's very happy," he said.
Newbridge has other investments with affiliates in the Internet sector.
Ottawa-area TimeStep Corp. sells network security software and neighboring Bridgewater
Systems Corp. sells software for Internet service providers. Vancouver, B.C.-based Abatis
Systems Corp. software manages Internet traffic.
Newbridge recently suggested it will sell its stake in high-speed router developer Juniper
Networks Inc. , a move that could help finance its Internet push. It paid $9.7 million for its 1.7
million Juniper shares, an investment now worth about $352 million.
Those paper gains are in addition to a cash balance which stood at $879.6 million at the close of
the fourth quarter.
"We don't consider our investment in Juniper to be a strategic investment -- which certainly would
suggest at some point in time we'd be divesting of it," said Lawlor.
"We've got product development -- both internally and within a number of affiliates -- we actually
believe is in some ways, I would say, ahead of the Juniper product."
With analysts expecting few surprises from Newbridge, the impression made by any Internet
announcement is being questioned.
"I think it's going to be more window dressing than it is going to be commercial,
revenue-generating reality," said one analyst who declined to be named. "This kind of thing, unless
you get the spotlights out and the cheerleaders, is not going to have a big impact."
===============================================================
biz.yahoo.com
Tuesday August 24, 5:34 pm Eastern Time
Company Press Release
Newbridge Networks Announces Record Revenue for First Quarter Fiscal
Year 2000
Continued Strong Growth in ATM Enables Company to Exceed Expectations
KANATA, Ontario--(BUSINESS WIRE)--Aug. 24, 1999-- Newbridge Networks Corporation (TSE:NNC - news; NYSE:NN - news) today announced financial results
for the first quarter of fiscal year 2000, ending August 1, 1999. Revenue for the quarter was $495 million, a record for the Company, and an increase of 8 percent over
the previous quarter. Net earnings for the quarter were $47 million -- 26c per share basic and fully diluted under Canadian GAAP, or U.S. 18c per share basic and
diluted under U.S. GAAP -- an increase of 50 percent compared with the previous quarter.
``This was a solid quarter,' said Alan Lutz, president and chief operating officer, Newbridge Networks. ``We said we were going to fix our supply line management
issues and we largely have. We said we were going to achieve significant growth and we did. We said we were going to control expenditures and margins and we did. I
want to thank all Newbridge employees for significantly improving our credibility with investors.'
WAN packet revenue grew by more than 12 percent sequentially to reach $357 million in the quarter, representing 72 percent of total revenue and resulting in record
WAN packet revenue. WAN packet revenue growth was driven by 16 percent sequential growth in the Company's flagship broadband multiservice platform and the
industry's best selling ATM system, the MainStreetXpress(TM) 36170 Multiservices Switch. Sales of the 36170 switch were more than double that of the previous
year's first quarter, as the platform continues to capture market share, growing at approximately twice the annual growth rate for the overall ATM WAN market.
There were approximately 140 customers for the MainStreetXpress 36170 system in the quarter -- a record number of 36170 customers for any quarter -- including 28
new customers. This brings the total number of customers for the platform to over 380. Customers include most of the largest service providers in the world. The
Company has received strong interest from all clients in the 50 Gbit/sec and 320 Gbit/sec expanded versions of the 36170 Multiservices Switch. These systems are
scheduled for trials later this fiscal year.
Company management continued to closely control operating expenses. First quarter operating expenses were $209 million, an increase of only $3 million from the prior
quarter, despite the fact that the Company's common salary review date of May 1st resulted in an increase in payroll expenses in the quarter of approximately $12
million compared with the prior quarter.
``As we entered the quarter I stated that our objective was to achieve the revenue and earnings goals for the quarter -- traditionally the lightest quarter of the fiscal year
-- without significantly diminishing the record level of backlog we had built,' continued Mr. Lutz. ``With the revenue and EPS numbers we posted, and a book-to-bill ratio
of approximately one, we achieved this objective.
``We have implemented a great deal of change over the past year to strengthen Newbridge. Significant reorganization has been completed. New blood and fresh ideas
have been injected into the Company through the addition of new executives to the leadership team. The product portfolio has been expanded and rejuvenated. The
supply line management issues outlined at the beginning of the quarter have been largely rectified, eliminating the constraint on our ability to grow the business.
I believe we are well positioned to take advantage of the opportunities created by the rapidly expanding networking market. Client response to our broadband access
products has been exceptional. Adding to our enthusiasm is early reaction to our differentiated IP services offering, and, in particular, our Digital Multimedia Distribution
System.``
This news release may include certain forward-looking statements that involve risks and uncertainties. Actual results may differ materially from results indicated in any
forward-looking statements. The Company cautions that, among other things, in view of the rapid technological changes in the networking industry, if technologies or
standards supported by the Company's products or common carrier service offerings based on the Company's products become obsolete or fail to gain widespread
commercial acceptance, the Company's business may be adversely affected. Additional information identifying risks and uncertainties is contained in the Company's
most recent Form 10-Q quarterly report and Form 10-K annual report filed with the SEC.
Newbridge Networks designs, manufactures, markets and services wide area networking solutions for Internet service providers; local, long-distance, and wireless
communications companies; cable television carriers; and corporate customers in more than 100 countries. The Company leverages its relationship with a growing family
of Newbridge Affiliate companies and strategic alliances with numerous other networking companies to deliver complete, end-to-end solutions. Newbridge customers
include the world's 350 largest telecommunications service providers and more than 10,000 corporations, government organizations and other institutions. Founded in
1986, the Company employs more than 6,000 people on six continents. News and information are available at www.newbridge.com.
Newbridge and logo are registered trademarks of Newbridge Networks Corporation.
Newbridge Networks is pleased to invite you to attend our conference call to discuss the Company's financial results for first quarter, fiscal 2000.
The conference call will be held today, Tuesday, August 24th at 5:30 p.m. Eastern Daylight Time (EDT). Please join us via audio telephone conference or through an
audio Web cast. The news release and the presentation graphic support material will be available on the Newbridge Web site at www.newbridge.com.
Telephone Conference Call
Please call in 10 minutes prior to the start of the call -- North America: 1-800-553-2165 -- International: 1-303-267-1000
Audio Web cast (listen only mode)
Simulcast: Newbridge Web site: www.newbridge.com -- Instant replay: Available until September 7, 1999 |
