MRV Reports Second Quarter 2004 Financial Results
Anticipates Ramp-Up in FTTP Component Revenues
7/22/2004 4:02:00 PM
CHATSWORTH, Calif., Jul 22, 2004 /PRNewswire-FirstCall via COMTEX/ -- MRV COMMUNICATIONS, INC. (MRVC), a leading provider of scalable network infrastructure equipment and optical components for metro and Fiber-to-the-Premise solutions, today reported its results for the second quarter ended June 30, 2004.
Net loss for the second quarter of 2004 was narrowed to $3.1 million, or $0.03 per share, compared to a net loss of $9.8 million, or $0.10 per share, for the second quarter of 2003 and a net loss of $4.8 million, or $0.05 per share, for the first quarter of 2004.
Revenues for the second quarter of 2004 were $67.2 million, compared to $62.0 million for the second quarter of 2003, and $59.6 million for the first quarter of 2004.
Noam Lotan, MRV's president and CEO, commented, "Q2 was a very good quarter. We are pleased with strong developments in our Fiber-to-the-Premises (FTTP) components. With FTTP, carriers can offer fiber grade data transmission, phone service as well as a full suite of CATV services. We continue to deliver solid improvements in our financial results, with significant gains in operating income. We are optimistic about the developments at MRV bringing us closer to our goal of profitability with our continued vigilance on cost containment. MRV remains intensely focused on our customers' needs for a broad array of Optical Ethernet Access solutions, ranging from 802.3 AH Ethernet in the first mile to advanced service solutions, including MPLS and VPLS customer edge devices. During the quarter, MRV raised the bar by announcing an industry first with its VPLS auto- discovery for multipoint to multipoint VPN services."
"Our net loss per share was reduced to $0.03 per share. Overall revenues grew 9% for the second quarter of 2004 compared to the same quarter last year, and were at the high end of our guidance. We have been growing on a year- over-year basis for three consecutive quarters. Our outlook continues to be positive for the next quarter and beyond. We expect year-over-year growth for the third quarter within the range of $60 to $64 million, lower than the second quarter due to the seasonal effects in Europe, which accounts for approximately 70% of our revenues," Mr. Lotan added.
Financial Highlight Presentation
A financial highlight and overview will be available in conjunction with the second quarter 2004 Teleconference and webcast discussed below. This presentation can be downloaded at mrv.com after 4:00 p.m. Eastern Time/1:00 p.m. Pacific Time on Thursday, July 22, 2004.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, and is subject to the safe harbor created by that section. These forward-looking statements include statements by Mr. Lotan, Mr. Margalit and Mr. Gonen relating to the competitive environment in 2004 and the Company's expectations of future success in achieving its objectives. Any forward-looking statements in this press release are subject to a number of risks and uncertainties, including the strength of the overall economy and the high-technology market in particular, competition, product development efforts, and acceptance of MRV Communications' current and future products. Actual results could differ materially from those projected in our forward-looking statements. Investors should review the risk factors described in more detail in our most recent SEC reports available free of charge from MRV Communications at www.mrv.com or from the SEC at www.sec.gov. MRV Communications, Inc. assumes no obligation to update the forward-looking statements contained in this press release.
Simultaneous Webcast and Teleconference Information
MRV Communications, Inc. will host a teleconference at 4:30 p.m. Eastern Time/1:30 p.m. Pacific Time on Thursday, July 22, 2004 to discuss the second quarter of 2004 results. To participate via telephone, the dial-in number is 617-801-9702, access code 76268349. Please call ten minutes prior to the scheduled conference call time. MRV Communications will offer its live and replay audio broadcast of the conference call at mrv.com.
Replay Information
A replay of the call will be available on MRV's website, beginning on Thursday, July 22, 2004, at 8:00 pm Eastern Time/5:00 p.m. Pacific Time, at mrv.com. In addition, a replay will be available by phone from 8:00 pm Eastern Time, July 22, 2004 to 8:00 pm Eastern Time, July 24, 2004 at 617-801-6888, access code 87311223.
Transcript of Mr. Lotan, Mr. Margalit and Mr. Gonen's Teleconference Discussion
A transcript of Mr. Lotan, Mr. Margalit and Mr. Gonen's Teleconference discussion will be available on MRV's website at mrv.com, beginning at 8:00 p.m. Eastern Time/5:00 p.m. Pacific Time on Thursday, July 22, 2004.
About MRV Communications, Inc.
MRV provides optical ethernet access equipment and services, and optical components. MRV conducts its business along three principal segments: the networking group, the optical components group and development stage enterprises. MRV's networking group provides equipment used by commercial customers, governments and telecommunications service providers, and include switches, routers, network physical infrastructure equipment and console server equipment as well as specialized networking products for defense and aerospace applications. MRV's optical components group designs, manufactures and sells optical communications components, primarily through its wholly owned subsidiary LuminentOIC, Inc. These components include components for Fiber-to-the-Premise, or FTTP, applications, fiber optic transceivers, and CWDM applications. MRV markets and sells its products worldwide, through a variety of channels, which include a dedicated direct sales force, manufacturers' representatives, value-added-resellers, distributors and systems integrators. MRV has operations in Europe that provide network system design, integration and distribution services that include products manufactured by third-party vendors, as well as MRV products. Such specialization enhances access to customers and allows the Company to penetrate targeted vertical and regional markets. For more information, call MRV at 818-773-0900 or visit our websites at www.mrv.com and www.luminentoic.com.
Investor Relations Contact
Diana L. Hayden, 818-886-6782, ir@mrv.com
MRV Communications, Inc.
Statements of Operations
(In thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
2004 2003 2004 2003
(Unaudited)
Net revenue $67,231 $61,958 $126,845 $113,075
Cost of goods sold 43,669 42,133 82,858 78,647
Gross profit 23,562 19,825 43,987 34,428
Operating costs and expenses:
Product development
and engineering 5,805 6,890 12,143 15,626
Selling, general and
administrative 18,676 16,698 36,826 28,616
Total operating costs
and expenses 24,481 23,588 48,969 44,242
Operating loss (919) (3,763) (4,982) (9,814)
Other expense, net 1,040 5,511 1,215 5,432
Loss before provision
for taxes (1,959) (9,274) (6,197) (15,246)
Provision for taxes 1,110 493 1,649 921
Net loss $(3,069) $(9,767) $(7,846) $(16,167)
Earnings per share:
Basic and diluted loss
per share $(0.03) $(0.10) $(0.07) $(0.16)
Weighted average number
of shares:
Basic and diluted 105,596 101,383 105,550 100,163
MRV Communications, Inc.
Balance Sheets
(In thousands)
June 30, December 31,
2004 2003
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $65,963 $88,706
Short-term marketable securities 15,405 5,221
Time deposits 1,084 1,411
Accounts receivable, net 56,501 53,464
Inventories 43,237 35,799
Other current assets 4,263 5,379
Total current assets 186,453 189,980
Property and equipment, net 21,917 25,416
Goodwill 29,965 29,965
Long-term marketable securities 1,641 1,705
Deferred income taxes 1,793 2,594
Investments 3,063 3,063
Other assets 1,649 2,040
$246,481 $254,763
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt
and short-term obligations $5,087 $2,905
Accounts payable 42,895 46,811
Accrued liabilities 25,550 25,523
Deferred revenue 3,430 3,754
Other current liabilities 3,465 2,936
Total current liabilities 80,427 81,929
Long-term debt 139 200
Convertible notes 23,000 23,000
Other long-term liabilities 4,170 4,215
Minority interest 5,169 5,291
Commitments and contingencies
Stockholders' equity 133,576 140,128
$246,481 $254,763
SOURCE MRV Communications, Inc.
Investor Relations, Diana L. Hayden of MRV Communications,
Inc., +1-818-886-6782, ir@mrv.com
mrv.com
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