[0] Copper Mountain Announces Record Revenue of $80.2 Million and Pro Forma Diluted Net Income of $0.24 Per Share for the Second Quarter of 2000.Business Editors PALO ALTO Palo Alto, city, California Palo Alto (păl`ō ăl`tō), city (1990 pop. 55,900), Santa Clara co., W Calif.; inc. 1894. Although primarily residential, Palo Alto has aerospace, electronics, and advanced research industries. , Calif.--(BUSINESS WIRE)--July 17, 2000 Copper Mountain Networks, Inc., (Nasdaq:CMTN) today announced financial results for the second quarter of 2000. Revenue for the second quarter of 2000 was $80.2 million, an increase of $57.3 million over revenue of $22.9 million for the second quarter of 1999. The second quarter of 2000 revenue represented an increase of $19.4 million, or 32 percent, over the $60.8 million in revenue reported for the first quarter of 2000. For the six months ended June June: see month. 30, 2000, Copper Mountain reported revenues of $141.0 million, a $104.9 million increase over revenue of $36.1 million reported for the first six months of 1999. Net income was $10.3 million or $0.18 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share for the second quarter of 2000, compared to net income of $2.3 million or $0.05 per diluted share for the same quarter of the prior year. Net income for the six months ended June 30, 2000 was $24.0 million or $0.41 per diluted share compared to net income of $1.3 million or $0.03 per diluted share for the same period of the prior year. Pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma net income, excluding the stock based compensation charge and the amortization of purchased intangibles was $14.2 million or $0.24 per pro forma diluted share for the second quarter of 2000, compared to pro forma net income of $2.8 million or $0.05 per pro forma diluted share for the same quarter of the prior year. On a pro forma basis, the second quarter was the company's seventh consecutive quarter of profitability.
Three Months Ended
June 30,
------------------------
(in thousands except per share data) 2000 1999
------ ------
Net revenue $ 80,185 $ 22,890
Net income $ 10,331 $ 2,343
Pro forma net income $ 14,240 (1) $ 2,786 (2)
Diluted net income per share $ 0.18 $ 0.05
Pro forma diluted
net income per share $ 0.24 (1) $ 0.05 (2)
(1) Excludes $1.2 million of stock based compensation and $5.2 million
in amortization of purchased intangibles, and the resulting income
before tax is taxed utilizing a 42.0% tax rate.
(2) Excludes $1.6 million of stock based compensation and the
resulting income before tax is taxed utilizing a 42.0% tax rate.
The pro forma data is presented for informational purposes only and should not be considered as a substitute for the historical financial data presented in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting . "In our second fiscal quarter of 2000, Copper Mountain had record revenues of $80.2 million, record pro forma earnings pro forma earnings Income not necessarily calculated in accordance with generally accepted accounting principles. For example, a company might report pro forma earnings that exclude depreciation expense and nonrecurring expenses such as restructuring costs. per share of $0.24 and positive cash flow for the fourth successive quarter," said Rick Gilbert, president and chief executive officer of Copper Mountain. "Our financial execution was matched by product development progress as we released both a G.lite See DSL. line card and an SDSL See DSL. SDSL - Single-line Digital Subscriber Line Integrated Access Device An IAD is a customer premises device that provides access to wide area networks and the Internet. Specifically, it aggregates multiple channels of information including voice and data across a single shared access link to a carrier or service provider PoP (Point of Presence). during the quarter. We expect that these products will continue to position Copper Mountain solutions as best-of-breed The best product of its type. Organizations often purchase software from different vendors in order to obtain the best-of-breed for each application area; for example, a human resources package from one vendor and an accounting package from another. for the evolving business, MTU (1) (Maximum Transmission Unit, Maximum Transfer Unit) The largest frame size that can be transmitted over the network. For example, an Ethernet MTU is 1,500 bytes. Messages longer than the MTU must be divided into smaller frames. , and residential DSL DSL in full Digital Subscriber Line Broadband digital communications connection that operates over standard copper telephone wires. It requires a DSL modem, which splits transmissions into two frequency bands: the lower frequencies for voice (ordinary markets." Gilbert added, "During the quarter Copper Mountain also expanded its distribution capability with the announcement of an OEM (Original Equipment Manufacturer) The rebranding of equipment and selling it. The term initially referred to the company that made the products (the "original" manufacturer), but eventually became widely used to refer to the organization that buys the products and agreement with Marconi (Marconi Communications, Warrendale, PA, www.marconi.com) A leading manufacturer of networking equipment. Founded in 1990 as FORE Systems by four Carnegie Mellon University faculty members, the company name was derived from its founders' first names: Francois, Onat, Robert and Eric. and we announced VersaPoint VersaPoint™ Gynecology Minimally-invasive electrosurgical device used with hysteroscopy for vaporizing, cutting or dissecting tissue, specifically for safe removal of uterine fibroids and as an alternative to hysterectomy. See Leiomyoma. N.V. as our first international customer. Overall, Q2 reflects our ongoing focus on excellence, execution, and market leadership." About Copper Mountain Networks Copper Mountain Networks, Inc. (Nasdaq:CMTN) develops and markets a comprehensive family of DSL solutions that enable high-speed high-speed adj. 1. Operated or designed for operation at high speed: a high-speed food processor. 2. Taking place at high speed: a high-speed chase. 3. internetworking internetworking - The interconnection of two or more networks, usually local area networks so that data can pass between hosts on the different networks as though they were one network. This requires some kind of router or gateway. over existing copper facilities. The company's mission is to enable carriers and other service providers to offer a full range of high-performance Adj. 1. high-performance - modified to give superior performance; "a high-performance car" superior - of high or superior quality or performance; "superior wisdom derived from experience"; "superior math students" , cost-effective cost-effective, n the minimal expenditure of dollars, time, and other elements necessary to achieve the health care result deemed necessary and appropriate. data and voice services over DSL that are easy to deploy, use, and manage. Copper Mountain's CopperRocket(R) CPE (Customer Premises Equipment) Communications equipment that resides on the customer's premises. CPE - Customer Premises Equipment family addresses the bandwidth, reliability, ease-of-use, and cost concerns of remote offices and users. Its CopperEdge(R) and OnPrem(TM) DSL concentrators and CopperView(TM) network management solutions offer a robust and scalable platform for carriers and multi-tenant In the Software as a Service (SaaS) software architecture, multi-tenant refers to the ability of the hosting site to support multiple organizations ("tenants") at the same time. Multi-tenancy is a key feature of a true SaaS architecture. unit service providers to generate a high return on investment while satisfying the ever-increasing user demand for bandwidth. For more information, please visit the company's World Wide Web site at http://www.coppermountain.com. For Investor Relations Investor relations The process by which the corporation communicates with its investors. information, call our toll free number at 877/463-6268 or contact us via e-mail at IR@coppermountain.com. Note to Investors Portions of this release contain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. regarding future events and are subject to risks and uncertainties. Copper Mountain wishes to caution you that there are some factors that could cause actual results to differ materially from the results indicated by such statements. These factors include, but are not limited to, quarterly fluctuations in operating results attributable to the timing and amount of orders for our products, the concentration of our revenue in a small number of customers, risks related to integrating the operations and products of OnPrem Networks with our own operations and product offerings, risks related to our rapid growth, factors affecting the rate of DSL deployment by our customers, market acceptance of our products, our ability to keep pace with rapidly changing product requirements, and factors affecting the demand for DSL technologies. We refer you to the documents Copper Mountain files from time to time with the Securities and Exchange Commission, specifically the section titled Risk Factors in our Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 1999 and other reports and filings made with the Securities and Exchange Commission. Note to Editors: Copper Mountain and all Copper Mountain product names are trademarks of Copper Mountain Networks, Inc. All other marks are the property of their respective owners.
Copper Mountain Networks, Inc.
Condensed Statements of Income
(in thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
------- ------- ------- -------
Net revenue $ 80,185 $22,890 $ 141,009 $ 36,106
Cost of revenue 36,079 10,815 64,180 17,199
--------- --------- --------- ---------
Gross profit 44,106 12,075 76,829 18,907
Operating expenses:
Research and development 8,400 3,274 15,172 5,838
Sales and marketing 9,370 3,319 15,033 5,900
General and administrative 3,917 1,336 6,580 2,463
Amortization of
purchased intangibles 5,246 -- 7,099 --
Amortization of deferred
stock compensation 1,164 1,601 2,196 3,294
Write-off of in-process
research and development -- -- 6,300 --
--------- --------- --------- ---------
Total operating expenses 28,097 9,530 52,380 17,495
--------- --------- --------- ---------
Income from operations 16,009 2,545 24,449 1,412
Other income, net 2,133 657 3,933 802
--------- --------- --------- ---------
Income before
income taxes 18,142 3,202 28,382 2,214
Provision for
income taxes 7,811 859 4,378 907
--------- --------- --------- ---------
Net income $ 10,331 $ 2,343 $ 24,004 $ 1,307
--------- --------- --------- ---------
Basic net income per share $ 0.20 $ 0.09 $ 0.48 $ 0.08
Basic common
stock equivalents 50,561 27,135 49,568 15,908
Diluted net
income per share $ 0.18 $ 0.05 $ 0.41 $ 0.03
Diluted common
stock equivalents 58,503 51,191 57,961 47,375
Condensed Balance Sheets
June 30, Dec. 31,
Assets 2000 1999
------ ------
Current assets:
Cash and S-T Investments $ 153,773 $ 117,169
Accounts receivable 49,988 18,992
Inventory 9,221 12,801
Other current assets 3,437 1,530
--------- ---------
Total current assets 216,419 150,492
Property and equip, net 14,601 8,825
Other assets 14,400 6,458
Purchased intangibles 56,791 ---
--------- ---------
$ 302,211 $ 165,775
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Liabilities and
Stockholders' Equity June 30, Dec. 31,
2000 1999
------ ------
Current liabilities:
Accounts payable $ 20,667 $ 7,887
Accrued liabilities 21,138 8,752
Deferred tax liability 12,111 48
Current notes payable 1,523 1,618
--------- ---------
Total current liabilities 55,439 18,305
Notes payable 3,600 4,044
Other liabilities 158 105
Total stockholders' equity 243,014 143,321
--------- ---------
$ 302,211 $ 165,775
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