New Focus Announces Strong Fourth Quarter Financial Results And Raises Revenue Expectations for Fiscal Year 2001
TUESDAY, JANUARY 30, 2001 4:15:00 PM EST
SAN JOSE, Calif., Jan 30, 2001 /PRNewswire via COMTEX/ -- New Focus, Inc., (Nasdaq: NUFO), a leading supplier of innovative fiber optic products for next-generation optical networks under the Smart Optics for Networks(TM) brand, today announced financial results for its fourth quarter and fiscal year ended December 31, 2000. The company's revenue expanded sharply during the fourth quarter, marking the third consecutive quarter of strong sequential growth in the company's fiber optic and photonics tool businesses. The company also increased revenue guidance for fiscal year 2001 based upon higher revenue expectations for its current businesses and incremental revenue from its new wholly-owned subsidiary, JCA Technology, Inc. The company's financial results will incorporate JCA beginning with the first quarter of 2001.
Fourth Quarter Review:
Net revenue for the fourth quarter of 2000 was $33.9 million, a sequential increase of 52% over the $22.2 million in revenue for the company's third fiscal quarter ended October 1, 2000. In the fourth quarter of 1999 net revenue was $6.8 million.
Net revenue from the company's fiber optic products in the fourth quarter of 2000 totaled $25.3 million, up 70% from $14.9 million in the third quarter of 2000. In the fourth quarter of 1999 fiber optic products accounted for $2.5 million of the company's net revenue. Net revenue from the company's photonics tool products in the fourth quarter of 2000 totaled $8.6 million, up 17% from $7.3 million in the third quarter of 2000. In the fourth quarter of 1999 photonics tool products accounted for $4.3 million of the company's net revenue.
The company recorded pro forma net income in the fourth quarter of 2000 of $2.6 million, or $0.04 per share based on 64.1 million diluted shares outstanding. The pro forma net income was attributable to a narrower operating loss and significant interest income derived from the company's cash position. The company reported a pro forma net loss of $1.3 million, or $0.02 per share based on 58.1 million basic shares outstanding in the third quarter of 2000. The pro forma net loss for the fourth quarter of 1999 was $4.3 million, or $0.11 per share based on 37.5 million basic shares outstanding.
The pro forma calculations for the fourth and third quarters of 2000 excluded non-cash charges for the amortization of deferred stock compensation of $4.8 million and $5.9 million, respectively. The deferred stock compensation charge in the fourth quarter of 1999 was $0.1 million. The number of shares used in the calculation of the pro forma net income or loss per share for each reporting period assumes the conversion of the company's convertible preferred stock into common stock, if applicable. Such conversion was completed in conjunction with the company's initial public offering in May 2000.
Without the pro forma adjustments to eliminate the deferred stock compensation charges and to convert the company's preferred stock into common stock, the company recorded a net loss for the fourth quarter of 2000 of $2.3 million, or $0.04 per share based on 60.5 million basic shares outstanding. The net loss for the third quarter of 2000 was $7.1 million, or $0.12 per share based on 58.1 million basic shares outstanding. For the fourth quarter of 1999 the net loss was $4.4 million, or $1.74 per share based on 2.5 million basic shares outstanding.
"We were extremely pleased with our fourth quarter financial results. Increased revenue, coupled with further improvements in our manufacturing efficiencies, pushed our fourth quarter gross margin to 31.3%, a sequential improvement of approximately nine percentage points over the third quarter. On the sales side, we experienced strong demand for all of our products throughout the quarter. On the production side, we began production in the first phase of our larger manufacturing facility in Shenzhen, China toward the end of the quarter and achieved a high level of utilization at our smaller Shenzhen manufacturing facility during the entire quarter. In addition to this tremendous internal momentum, we completed our acquisition of JCA Technology, Inc. in mid-January," said Ken Westrick, president and chief executive officer of New Focus, Inc.
Fiscal Year Results:
Net revenue for the twelve months ended December 31, 2000 was $80.4 million, an increase of 252% over $22.8 million in net revenue for the twelve months ended December 31, 1999. Net revenue from fiber optic products totaled $53.6 million and $5.0 million in the twelve months of 2000 and 1999, respectively. Net revenue from photonics tool products totaled $26.8 million and $17.8 million in the twelve months of 2000 and 1999, respectively.
On a pro forma basis, the net loss for fiscal 2000 was $12.2 million, or $0.22 per share based on 54.7 million basic shares outstanding. The pro forma net loss for the twelve months of 1999 was $9.1 million, or $0.30 per share based on 30.0 million basic shares outstanding. The deferred stock compensation charges excluded from the twelve months of 2000 and 1999 were $23.7 million and $0.1 million, respectively.
Without the pro forma adjustments to eliminate the deferred stock compensation charges and to convert the company's preferred stock into common stock, the net loss for fiscal 2000 was $36.0 million, or $0.92 per share based on 38.9 million basic shares outstanding. The net loss for the twelve months of 1999 was $9.3 million, or $3.78 per share based on 2.5 million basic shares outstanding.
Business Outlook:
"We expect that fiscal year 2001 will represent another significant chapter in the growth of New Focus. On December 19, 2000 we announced our decision to proceed with the second phase of the expansion of our manufacturing facilities in Shenzhen, China based on the strength of our existing fiber optics business. With the completion of the acquisition of JCA Technology, Inc. earlier this month, we added a new product line of fiber optic products to our product portfolio. This new product line includes high-speed clock amplifiers and broadband data driver amplifiers for OC-48 and OC-192 modulators. Combining the expected revenue contributions from our existing businesses and JCA's products, we are raising our revenue guidance for fiscal year 2001 from $150 million to $240 million," said Westrick.
The company is planning to expand manufacturing capacity at its recently acquired subsidiary, JCA Technology, Inc., due to the demand outlook for JCA's products. In light of the JCA expansion and the company's previously announced expansion plans for its U.S. and China facilities, the company is raising its projected capital expenditures for fiscal 2001 to $90-100 million from an earlier estimate of $70-80 million. With a cash balance of $485 million at the end of fiscal 2000, the company has more than sufficient cash resources to execute its expansion plans. In fiscal 2000 the company's capital spending totaled approximately $52 million.
"We again saw significant improvement in our gross margin percentage in the recently completed quarter and expect further improvement throughout fiscal 2001. With the addition of the JCA product family, we now expect that our gross margin performance in the fourth quarter of 2001 will increase to 43-48% from our previously targeted margin range of 40-45%. Our targeted gross margin and revenue performance for fiscal 2001 should allow us to record positive pro forma operating income during the third and fourth quarters of 2001 and put us in position to move the breakeven point for operating income into the first half of 2001 should revenue growth accelerate beyond the targeted level," said Westrick....
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