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FREMONT, Calif., Jan 28, 2010 (BUSINESS WIRE) -- Oplink Communications, Inc. (Nasdaq: OPLK), a leading provider of design, integration and optical manufacturing solutions (OMS) for optical networking components, modules and subsystems, today reported its financial results for its fiscal 2010 second quarter, ended December 31, 2009.
Revenues for the quarter were $32.7 million, compared to $33.6 million reported for the first quarter of fiscal 2010. GAAP net income for the second quarter of fiscal 2010 increased to $3.1 million, or $0.14 per diluted share, compared to a GAAP net income of $1.8 million, or $0.09 per diluted share, reported for the first quarter of fiscal 2010.
Non-GAAP net income for the second quarter of fiscal 2010 increased to $5.7 million, or $0.26 per diluted share, compared to non-GAAP net income of $4.4 million, or $0.21 per diluted share, reported for the first quarter of fiscal 2010. Second quarter of fiscal 2010 non-GAAP results exclude $1.6 million in stock compensation and $945,000 in amortization of intangible assets. First quarter of fiscal 2010 non-GAAP results exclude $1.6 million in stock compensation and $946,000 in amortization of intangibles.
Oplink generated $8.5 million in cash from operations during the second quarter, and closed the period with cash, cash equivalents and investments of $188.8 million.
"We are pleased with our second quarter performance and execution, especially considering ongoing macroeconomic conditions," commented Joe Liu, President and CEO of Oplink. "We reported solid gross margins while continuing to manage operating costs. In the coming quarter, we expect telecommunications spending to continue to be constrained and will experience some seasonality and the impact of a shorter manufacturing period, including the Chinese New Year. We remain committed to providing customers with the highest-quality design, integration and manufacturing of optical components and expect to achieve market share gains as carrier spending normalizes."
Business Outlook for the Quarter Ending March 31, 2010
The Company expects to report revenues in the range of $30 million and $34 million and GAAP net income per diluted share in the range of $0.05 to $0.11. On a non-GAAP basis, excluding stock compensation, amortization of intangible assets and other non-cash or non-recurring charges, Oplink expects earnings per diluted share for the period to be in the range of $0.16 to $0.22.
Conference Call Information
The Company will host a conference call and live webcast at 2:00 p.m. Pacific Time today, January 28, 2010. To access the conference call, dial 877-941-8416 or 480-629-9808 (outside the U.S. and Canada). The webcast will be available live on the Investor Relations section of the Company's corporate website at http://investor.oplink.com and via replay beginning approximately two hours after the completion of the call until the Company's announcement of its financial results for the next quarter. An audio replay of the call will also be available to investors beginning at approximately 5:00 p.m. Pacific Time on January 28, 2010 until 11:59 p.m. Pacific Time on February 4, 2010, by dialing 800-406-7325 or 303-590-3030 (outside the U.S. and Canada) and entering pass code 4199755#.
Non-GAAP Financial Measures
In this earnings release and during the earnings conference call and webcast as described above, Oplink will discuss certain non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. A reconciliation between non-GAAP and GAAP measures can be found in the accompanying tables. Oplink believes that, while these non-GAAP measures are not a substitute for GAAP results, they provide a basis for evaluating the Company's cash requirements for ongoing operating activities. These non-GAAP measures have been reconciled to the nearest GAAP measure as required under Securities and Exchange Commission rules.
About Oplink
Incorporated in 1995, Oplink is a leading provider of design, integration and optical manufacturing solutions (OMS) for optical networking components, modules and subsystems. Oplink offers advanced and cost-effective optical-electrical components and subsystem manufacturing through its facilities in Zhuhai and Shanghai, China. In addition, Oplink maintains optical-centric front-end design, application, and customer service functions at its offices in Fremont and Calabasas, California and has research facilities in Zhuhai and Wuhan, China and Hsinchu Science-Based Industrial Park in Taiwan. Oplink's customers include telecommunications, data communications and cable TV equipment manufacturers around the globe. Oplink is committed to providing fully customized, photonic foundry services incorporating its subsystems manufacturing capabilities. To learn more about Oplink, visit its web site at: http://www.oplink.com/.
Cautionary Statement
This news release contains forward-looking statements, including without limitation the guidance given for anticipated results for the third quarter of fiscal year 2010 and the expected normalization of carrier spending, that involve risks and uncertainties that may cause results to differ substantially from expectations. These risks include, but are not limited to, the potential for a sustained continuation and/or worsening of the current downturn in the telecommunications industry or the overall economy in the United States and other parts of the world, possible reductions in customer orders, Oplink's reliance upon third parties to supply components and materials for its products, intense competition in Oplink's target markets and potential pricing pressure that may arise from changing supply or demand conditions in the industry, and other risks detailed from time to time in Oplink's periodic reports filed with the Securities and Exchange Commission, including the Company's latest Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
The foregoing information represents Oplink's outlook only as of the date of this press release, and Oplink undertakes no obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise.
| OPLINK COMMUNICATIONS, INC. | |||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||||
| (In thousands) | |||||||||
| December 31, | June 30, | ||||||||
| 2009 | 2009 | ||||||||
| (Unaudited) | (1) | ||||||||
| ASSETS | |||||||||
| Current assets: | |||||||||
| Cash and cash equivalents | $ | 57,815 | $ | 49,702 | |||||
| Short-term investments | 120,992 | 115,774 | |||||||
| Accounts receivable, net | 25,374 | 29,023 | |||||||
| Inventories | 10,308 | 10,031 | |||||||
| Prepaid expenses and other current assets | 3,982 | 2,648 | |||||||
| Total current assets | 218,471 | 207,178 | |||||||
| Long-term investments | 10,000 | 3,180 | |||||||
| Property, plant and equipment, net | 28,060 | 30,318 | |||||||
| Intangible assets, net | 6,957 | 8,848 | |||||||
| Other assets | 418 | 423 | |||||||
| Total assets | $ | 263,906 | $ | 249,947 | |||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||
| Current liabilities: | |||||||||
| Accounts payable | $ | 9,623 | $ | 7,580 | |||||
| Accrued liabilities and other current liabilities | 10,568 | 10,688 | |||||||
| Accrued transitional costs for contract manufacturing | 160 | 160 | |||||||
| Total current liabilities | 20,351 | 18,428 | |||||||
| Non-current liabilities | 3,903 | 3,492 | |||||||
| Total liabilities | 24,254 | 21,920 | |||||||
| Stockholders' equity | 239,652 | 228,027 | |||||||
| Total liabilities and stockholders' equity | $ | 263,906 | $ | 249,947 | |||||
| (1) | The June 30, 2009 condensed consolidated balance sheet has been derived from audited consolidated financial statements at that date. | ||||||||
| OPLINK COMMUNICATIONS, INC. | ||||||||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||||
| (In thousands, except per share amounts) | ||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||||||||||
| 2009 | 2009 | 2008 | 2009 | 2008 | ||||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||||
| Revenues | $ | 32,743 | $ | 33,565 | $ | 37,611 | $ | 66,308 | $ | 80,563 | ||||||||||||
| Cost of revenues: | ||||||||||||||||||||||
| Cost of revenues | 21,643 | 23,634 | 28,939 | 45,277 | 65,584 | |||||||||||||||||
| Stock compensation expense | 88 | 99 | 126 | 187 | 244 | |||||||||||||||||
| Total cost of revenues | 21,731 | 23,733 | 29,065 | 45,464 | 65,828 | |||||||||||||||||
| Gross profit | 11,012 | 9,832 | 8,546 | 20,844 | 14,735 | |||||||||||||||||
| Operating expenses: | ||||||||||||||||||||||
| Research and development | 2,268 | 2,225 | 2,785 | 4,493 | 6,067 | |||||||||||||||||
| Sales and marketing | 1,923 | 2,086 | 1,945 | 4,009 | 4,202 | |||||||||||||||||
| General and administrative | 1,810 | 1,721 | 2,702 | 3,531 | 5,368 | |||||||||||||||||
| Stock compensation expense | 1,520 | 1,547 | 1,242 | 3,067 | 2,691 | |||||||||||||||||
| Impairment charges and other costs | - | - | 10,829 | - | 10,829 | |||||||||||||||||
| Amortization of intangible and other assets | 403 | 404 | 412 | 807 | 824 | |||||||||||||||||
| Total operating expenses | 7,924 | 7,983 | 19,915 | 15,907 | 29,981 | |||||||||||||||||
| Income (loss) from operations | 3,088 | 1,849 | (11,369 | ) | 4,937 | (15,246 | ) | |||||||||||||||
| Interest and other income, net | 193 | 274 | 1,300 | 467 | 2,340 | |||||||||||||||||
| Gain (loss) on sale/disposal of assets | 214 | 124 | (492 | ) | 338 | (611 | ) | |||||||||||||||
| Income (loss) before provision for income taxes | 3,495 | 2,247 | (10,561 | ) | 5,742 | (13,517 | ) | |||||||||||||||
| Provision for income taxes | (358 | ) | (438 | ) | 15 | (796 | ) | (441 | ) | |||||||||||||
| Net income (loss) | $ | 3,137 | $ | 1,809 | $ | (10,546 | ) | $ | 4,946 | $ | (13,958 | ) | ||||||||||
| Net income (loss) per share: | ||||||||||||||||||||||
| Basic | $ | 0.15 | $ | 0.09 | $ | (0.51 | ) | $ | 0.24 | $ | (0.67 | ) | ||||||||||
| Diluted | $ | 0.14 | $ | 0.09 | $ | (0.51 | ) | $ | 0.23 | $ | (0.67 | ) | ||||||||||
| Shares used in per share calculation: | ||||||||||||||||||||||
| Basic | 20,797 | 20,566 | 20,686 | 20,686 | 20,721 | |||||||||||||||||
| Diluted | 21,694 | 21,173 | 20,686 | 21,452 | 20,721 | |||||||||||||||||
| RECONCILIATION OF GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL MEASURES | ||||||||||||||||||||||
| (unaudited, in thousands, except per share amounts) | ||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||||||||||
| Reconciliation of GAAP net income (loss) to | 2009 | 2009 | 2008 | 2009 | 2008 | |||||||||||||||||
| non-GAAP net income: | ||||||||||||||||||||||
| Net income (loss), GAAP | $ | 3,137 | $ | 1,809 | $ | (10,546 | ) | $ | 4,946 | $ | (13,958 | ) | ||||||||||
| Adjustments to measure non-GAAP: | ||||||||||||||||||||||
| Related to cost of revenues: | ||||||||||||||||||||||
| Provision for excess and obsolete inventory | - | - | - | - | 4,065 | |||||||||||||||||
| Stock compensation expense | 88 | 99 | 126 | 187 | 244 | |||||||||||||||||
| Amortization of intangible and other assets | 542 | 542 | 542 | 1,084 | 1,084 | |||||||||||||||||
| Total related to cost of revenues | 630 | 641 | 668 | 1,271 | 5,393 | |||||||||||||||||
| Related to operating expenses: | ||||||||||||||||||||||
| Stock compensation expense | 1,520 | 1,547 | 1,242 | 3,067 | 2,691 | |||||||||||||||||
| Impairment charges and other costs | - | - | 10,829 | - | 10,829 | |||||||||||||||||
| Amortization of intangible and other assets | 403 | 404 | 412 | 807 | 824 | |||||||||||||||||
| Total related to operating expenses | 1,923 | 1,951 | 12,483 | 3,874 | 14,344 | |||||||||||||||||
| Total related to net income (loss) | 2,553 | 2,592 | 13,151 | 5,145 | 19,737 | |||||||||||||||||
| Non-GAAP net income | $ | 5,690 | $ | 4,401 | $ | 2,605 | $ | 10,091 | $ | 5,779 | ||||||||||||
| Net income per share, non-GAAP: | ||||||||||||||||||||||
| Basic | $ | 0.27 | $ | 0.21 | $ | 0.13 | $ | 0.49 | $ | 0.28 | ||||||||||||
| Diluted | $ | 0.26 | $ | 0.21 | $ | 0.12 | $ | 0.47 | $ | 0.27 | ||||||||||||
| Shares used in per share calculation: | ||||||||||||||||||||||
| Basic | 20,797 | 20,566 | 20,686 | 20,686 | 20,721 | |||||||||||||||||
| Diluted | 21,694 | 21,173 | 21,016 | 21,452 | 21,150 | |||||||||||||||||
| Reconciliation of GAAP gross profit | ||||||||||||||||||||||
| to non-GAAP gross profit: | ||||||||||||||||||||||
| GAAP gross profit | $ | 11,012 | $ | 9,832 | $ | 8,546 | $ | 20,844 | $ | 14,735 | ||||||||||||
| Provision for excess and obsolete inventory | ||||||||||||||||||||||
| included in cost of revenues | - | - | - | - | 4,065 | |||||||||||||||||
| Stock compensation expense included | ||||||||||||||||||||||
| in cost of revenues | 88 | 99 | 126 | 187 | 244 | |||||||||||||||||
| Amortization of intangible and other assets | ||||||||||||||||||||||
| included in cost of revenues | 542 | 542 | 542 | 1,084 | 1,084 | |||||||||||||||||
| Non-GAAP gross profit | $ | 11,642 | $ | 10,473 | $ | 9,214 | $ | 22,115 | $ | 20,128 | ||||||||||||
| GAAP gross margin rate | 33.6 | % | 29.3 | % | 22.7 | % | 31.4 | % | 18.3 | % | ||||||||||||
| Non-GAAP gross margin rate | 35.6 | % | 31.2 | % | 24.5 | % | 33.4 | % | 25.0 | % | ||||||||||||
| OPLINK COMMUNICATIONS, INC. | |||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||
| (In thousands) | |||||||||||
| Six Months Ended | |||||||||||
| December 31, | |||||||||||
| 2009 | 2008 | ||||||||||
| (Unaudited) | |||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income (loss) | $ | 4,946 | $ | (13,958 | ) | ||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 3,341 | 3,817 | |||||||||
| Inventory adjustments | - | 4,065 | |||||||||
| Impairment charge and other costs | - | 10,829 | |||||||||
| Amortization of intangible and other assets | 1,891 | 1,908 | |||||||||
| Stock compensation expense | 3,254 | 2,935 | |||||||||
| (Gain) loss on sale/disposal of assets | (338 | ) | 611 | ||||||||
| Other | 113 | (792 | ) | ||||||||
| Change in assets and liabilities | 4,403 | (1,676 | ) | ||||||||
| Net cash provided by operating activities | 17,610 | 7,739 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Net (purchases) sales of investments | (12,072 | ) | 7,774 | ||||||||
| Net (purchases) sales of property and equipment | (851 | ) | (1,359 | ) | |||||||
| Net cash (used in) provided by investing activities | (12,923 | ) | 6,415 | ||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from issuance of common stock | 3,406 | 846 | |||||||||
| Repurchase of common stock | - | (2,293 | ) | ||||||||
| Net cash provided by (used in) financing activities | 3,406 | (1,447 | ) | ||||||||
| Effect of exchange rate changes on cash and cash equivalents | 20 | (410 | ) | ||||||||
| Net increase in cash and cash equivalents | 8,113 | 12,297 | |||||||||
| Cash and cash equivalents, beginning of period | 49,702 | 72,001 | |||||||||
| Cash and cash equivalents, end of period | $ | 57,815 | $ | 84,298 | |||||||
SOURCE: Oplink Communications, Inc.
for Oplink Communications, Inc.
Investor Relations:
Erica Abrams, 415-217-5864
erica@blueshirtgroup.com
Matthew Hunt, 415-489-2194
matt@blueshirtgroup.com
Copyright Business Wire 2010
