Mike,
I know you were kidding, but maybe you should take a look at CIEN's operations from a cash flow perspective:
Note the decline in cash flow from operations.
CIENA CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
YEAR ENDED OCTOBER 31,
---------------------------------------
1997 1998 1999
--------- --------- ---------
Cash flows from operating activities:
Net income (loss) .................................................... $ 115,568 $ 45,700 $ (3,924)
Adjustments to reconcile net income to net cash
provided by operating activities:
Adjustment to conform fiscal year ends of pooled acquisitions ..... - - 1,621
Non-cash charges from equity transactions ......................... 85 289 8,521
Amortization of premiums on marketable debt securities ............ - 464 1,776
Effect of translation adjustment .................................. (5) (102) 67
Purchased research and development ................................ - 9,503 -
Write down of leasehold improvements and equipment ................ 923 1,605 -
Depreciation and amortization ..................................... 10,256 33,623 50,418
Provision for doubtful accounts ................................... 489 806 250
Provision for inventory excess and obsolescence ................... 7,585 9,617 6,534
Provision for warranty and other contractual obligations .......... 11,866 10,523 8,396
Changes in assets and liabilities:
Increase in accounts receivable ................................ (46,309) (7,026) (65,807)
Increase in inventories ........................................ (35,466) (39,416) (15,234)
Increase in deferred income tax assets ......................... (7,305) (7,282) (8,964)
(Increase) decrease in prepaid income taxes .................... - (11,688) 11,688
Increase in prepaid expenses and other assets .................. (2,468) (18,528) (13,222)
Increase (decrease) in accounts payable and accrued expenses ... 30,608 (6,288) 22,159
Increase (decrease) in income taxes payable .................... (3,916) (46) 8,697
Increase in deferred income tax liabilities .................... 4,793 5,958 2,828
Increase (decrease) in deferred revenue and other obligations .. (2,007) (1,507) 1,870
--------- --------- ---------
Net cash provided by operating activities .......................... 84,697 26,205 17,674
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Cash flows from investing activities:
Additions to equipment, furniture and fixtures ..................... (67,030) (88,913) (46,776)
Purchase of marketable debt securities ............................. - (93,869) (274,897)
Maturities of marketable debt securities ........................... - 77,876 171,934
Net cash paid for business combinations ............................ - (2,070) -
--------- --------- ---------
Net cash used in investing activities .......................... (67,030) (106,976) (149,739)
--------- --------- ---------
Cash flows from financing activities:
Net proceeds from (repayment of) other obligations ................. (2,238) 1,148 1,639
Net proceeds from issuance of common stock ......................... 180,665 34,318 11,291
Tax benefit related to exercise of stock options and warrants ...... 53,083 22,634 11,004
Repayment of notes receivable from stockholders .................... 69 99 857
--------- --------- ---------
Net cash provided by financing activities ...................... 231,579 58,199 24,791
--------- --------- ---------
Net increase (decrease) in cash and cash equivalents ........... 249,246 (22,572) (107,274)
Cash and cash equivalents at beginning of period ....................... 24,040 273,286 250,714
--------- --------- ---------
Cash and cash equivalents at end of period ............................. $ 273,286 $ 250,714 $ 143,440
========= ========= =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest ........................................................ $ 405 $ 265 $ 504
========= ========= =========
Income taxes .................................................... $ 27,455 $ 30,203 $ 313
========= ========= =========
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES:
Issuance of common stock for notes receivable from stockholders ..... $ 77 $ 617 $ 481 |
