Reports Q2 Sales of $18 Million
CHICAGO, Dec. 7 /PRNewswire-FirstCall/ -- Stratos International, Inc.
(Nasdaq: STLW), a leading provider of optoelectronic, fiber optic, and radio
frequency (RF) and microwave subsystems and components, today announced
financial results for its second quarter of fiscal 2005, ended October 31,
2004.
Sales for the second quarter of fiscal 2005 were $18.2 million, consistent
with the revised guidance provided by the Company in its press release on
November 5. The Company also recorded license fees and royalty income of
$1.5 million in the second quarter of fiscal 2005.
For comparison, first quarter fiscal 2005 revenue for the three months
ended July 31, 2004 was $21.0 million. First quarter fiscal 2005 license fees
and royalty income for the three months ended July 31, 2004 was $2.8 million.
Second quarter fiscal 2004 revenue for the three months ended October 31, 2003
was $7.1 million.
Financial results include operating results of Sterling Holding Company
from the date of its acquisition on November 6, 2003. The merger with
Sterling provided Stratos with two leading brands, Trompeter and Semflex, a
suite of highly profitable and complementary specialty RF and microwave
products, and an expanded customer base and strong sales channels.
"The sequential decline in revenue was primarily due to soft market demand
for transceiver sales to Telecom and enterprise customers, coupled with the
returns of a specific transceiver sold to one customer. Our balance sheet
remains healthy with approximately $37 million of cash and short-term
investments at quarter end," said David Slack, Chief Financial Officer.
The net loss attributable to common shareholders for the second quarter of
fiscal 2005 was $4.1 million, or $0.30 per share. By comparison, the Company
reported a net loss attributable to common shareholders of $7.5 million or
$1.02 per share for the second quarter of fiscal 2004, and a net loss
attributable to common shareholders of $480,000, or $0.04 per share for the
first quarter of fiscal 2005.
Sales for the six months ended October 31, 2004 were $39.2 million,
compared to $13.7 million for the same period last year. License fees and
royalty income for the first six months in fiscal 2005 was $4.3 million,
compared to $619,000 in the comparable period of the prior fiscal year. The
net loss attributable to common shareholders for the first six months ended
October 31, 2004 was $4.6 million or $0.34 per share compared to $14.8 million
or $2.00 per share for the same period last year.
In May, Stratos International announced its decision to explore various
strategic alternatives to maximize shareholder value, including the possible
sale of the Company. The Company has retained CIBC World Markets Corp. as its
exclusive financial advisor. There is no assurance that a transaction will
result involving the Company. In the meantime, the Company expects to continue
operations as usual by seeking new business, developing new products and
working with customers to maintain a high level of customer service.
Webcast/Conference Call
Stratos International will host a live audio webcast and conference call
on Tuesday, December 7, 2004 at 5:00 pm EST. Investors and other interested
parties may listen to the live webcast by visiting the investor relations
section of the Stratos International website at
http://www.stratoslightwave.com . David A. Slack, Chief Financial Officer,
will discuss the Company's earnings and operations. A replay of the conference
call will be available for 48 hours beginning at 7:00 pm EST. The replay
number is (706) 645-9291 with a conference ID of 2332535. A webcast replay
will also be available on the Company's website.
ABOUT STRATOS INTERNATIONAL
Stratos International, Inc. is a leading designer, developer and
manufacturer of active and passive optical, optoelectronic, RF and Microwave
components, subsystems and interconnect products used in telecom, enterprise,
military and video markets.
Stratos has a rich history of optical and mechanical packaging expertise
and has been a pioneer in developing several optical devices using innovative
form factors for telecom, datacom and harsh environments application. This
expertise, coupled with several strategic acquisitions, has allowed the
Company to amass a broad range of products and build a strong IP portfolio of
more than 100 patents. The Company is a market leader in several niches
including high margin specialty optical products such as RJ and low rider
transceivers, Media Interface Adapters, flex circuits, as well as high
performance RF and microwave coax and triax interconnect products. The Company
currently serves more than 400 active customers in telecom, military and video
markets.
This press release contains predictions and other forward-looking
statements. All forward-looking statements in this press release are based on
information available to the Company as of the date hereof, and we assume no
obligation to update any such forward-looking statements. Forward-looking
statements are subject to risks and uncertainties and actual results may
differ materially from any future performance suggested. These factors include
rapid technological change in the optical communications industry;
fluctuations in operating results; the Company's dependence on a few large
customers; and competition. Other risk factors that may affect the Company's
performance are listed in the Company's annual report on Form 10-K and other
reports filed from time to time with the Securities and Exchange Commission.
For additional information contact Stratos International at 7444 W. Wilson
Ave., Chicago, IL USA 60706-4549; Tel: 708.867.9600. Fax: 708.867.0996.
Website: http://www.stratoslightwave.com .
STRATOS INTERNATIONAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(In thousands, except per share amounts and shares outstanding)
Three Months Ended Six Months Ended
October 31 October 31
2004 2003 2004 2003
Revenue:
Net sales $18,181 $7,111 $39,204 $13,682
License fees and
royalties 1,493 113 4,276 619
Total 19,674 7,224 43,480 14,301
Costs and expenses:
Cost of products
sold 12,439 8,020 26,253 15,498
Research and
development 2,422 1,807 4,828 4,697
Sales and marketing 2,610 1,327 5,419 2,845
General and
administrative 6,267 3,775 11,501 6,473
Total costs and
expenses 23,738 14,929 48,001 29,513
Loss from operations (4,064) (7,705) (4,521) (15,212)
Investment income 65 184 129 423
Loss before income
taxes (3,999) (7,521) (4,392) (14,789)
Provision (credit)
for income taxes - - - -
Net loss (3,999) (7,521) (4,392) (14,789)
Preferred Stock
Dividends $(88) $- $(175) $-
Net loss attributable
to Common
shareholders $ (4,087) $(7,521) $(4,567) $(14,789)
Net loss per share,
basic and diluted :
Net loss $(0.30) $(1.02) $ (0.33) $ (2.00)
Preferred stock
dividend requirement - - (0.01) -
Net loss per share
attributable to
common
shareholders $(0.30) $(1.02) $ (0.34) $ (2.00)
Weighted average
number of Common
Shares outstanding:
Basic 13,548,922 7,392,495 13,541,547 7,378,408
Diluted 13,548,922 7,392,495 13,541,547 7,378,408
STRATOS INTERNATIONAL INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
October 31 April 30
2004 2004
(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $27,388 $15,501
Short term investments 9,247 21,488
Accounts receivable - net 10,703 12,544
Inventories 16,871 15,964
Recoverable income taxes 4,212 4,176
Prepaid expenses 1,235 1,326
TOTAL CURRENT ASSETS 69,656 70,999
PROPERTY, PLANT AND EQUIPMENT 89,678 91,530
Less allowances for depreciation 65,848 64,574
NET PROPERTY, PLANT AND EQUIPMENT 23,830 26,956
OTHER ASSETS
Goodwill and other long lived assets 6,110 6,110
Intangible assets, net of amortization 14,036 14,665
Assets held for sale 2,988 4,441
Other 6,043 5,879
TOTAL OTHER ASSETS 29,177 31,095
TOTAL ASSETS $122,663 $129,050
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $7,044 $8,422
Current portion of long-term debt 1,766 2,230
Other current liabilities 8,153 7,373
TOTAL CURRENT LIABILITIES 16,963 18,025
OTHER LIABILITIES
Long term debt - 801
Deferred Income Taxes 445 445
Redeemable Preferred Stock 5,000 5,000
SHAREHOLDERS' EQUITY
Common Stock 142 143
Paid in capital 318,629 319,212
Accumulated deficit (215,201) (210,633)
Unearned Compensation (2,796) (3,809)
Treasury Stock (248) (248)
Foreign Currency Translation Adjustment (271) 114
TOTAL SHAREHOLDERS' EQUITY 100,255 104,779
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $122,663 $129,050
SOURCE Stratos International, Inc.
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Related links:
http://www.stratoslightwave.com
CONTACT:
David A. Slack, Chief Financial Officer, or
Barry R. Hollingsworth, Investor Relations, both of Stratos
International, Inc., +1-708-867-9600
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