Accelerated Networks Announces Second Quarter 2000 Results; Strong Revenue Growth, Up 604% Year-Over-Year.Business Editors MOORPARK, Calif.--(BUSINESS WIRE)--July 26, 2000 Accelerated Networks, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : ACCL ACCL American Canadian Caribbean Line ACCL Acceleration ACCL American College of Construction Lawyers ACCL Accreditation Council for Clinical Lipidology (Allied Health Certification Program) ACCL Amway China Co Limited ), a developer of telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. equipment, today reported its financial results for the second quarter and six months ended June June: see month. 30, 2000. Net revenues for the second quarter of 2000 were $8.8 million compared with $1.2 million for the second quarter of 1999, an increase of 604%. 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 loss for the second quarter of 2000 was $8.3 million or $(0.19) per pro forma 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 (excluding amortization of deferred stock compensation of $2.4 million and a one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. charge of $1.4 million for the issuance of warrants) compared to a pro forma net loss for the second quarter of 1999 of $3.8 million or $(0.10) per pro forma diluted share (excluding amortization of deferred stock compensation of $408,000). Before pro forma adjustments, net loss for the second quarter of 2000 was $12.1 million or $(1.08) per diluted share, compared to a net loss of $4.2 million or $(0.69) per diluted share for the second quarter of 1999. Net revenues for the six months ended June 30, 2000 grew 1,179% to $15.9 million from $1.2 million for the six months ended June 30, 1999. Pro forma net loss for the six months ended June 30, 2000 was $14.7 million or $(0.36) per pro forma diluted share (excluding amortization of deferred stock compensation of $4.8 million, one-time charge of $1.4 million for the issuance of warrants, and a one-time beneficial conversion feature charge of $9.9 million) compared to a pro forma net loss for the six months ended June 30, 1999 of $7.4 million or $(0.21) per pro forma diluted share (excluding amortization of deferred stock compensation of $646,000). Before pro forma adjustments, net loss for the six months ended June 30, 2000 was $30.8 million or $(3.89) per diluted share compared to a net loss of $8.1 million or $(1.36) per diluted share for the six months ended June 30, 1999. "We believe our revenue growth, as well as the numerous new trials we have underway across a variety of US service providers, supports two concepts that have been central to our mission from the very beginning," said Suresh Suresh is a sanskrit word which means "Ruler of gods". It is a synonym for the Hindu God Vishnu(It may be Devendra, sur means heaven eswar means king of the gods. The other meaning of sureshwar means Shiv Shankar The creator of Brahma & Vishnu)] and is a frequently used name for Nihalani, president and chief executive officer. He continued, "First, that broadband access See broadband and wireless broadband. is a strategic necessity for service providers of any type, and second, that the delivery of a rich bundle To sell hardware and software as a combined product or to combine several software packages for sale as a single unit. Contrast with unbundle. See bundled software and bundling. of voice and data services over packet-based broadband access infrastructure is an economic necessity for service providers focused on profitability." Note to Investors Portions of this press 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 or the future performance of the Company. Forward-looking statements involve risks and uncertainties, which could cause actual results to differ materially from the results indicated by such statements. These factors include, but are not limited to, the timing of orders and shipments of our products, mix of products sold, changes in the prices of our components, ability to maintain production volumes and secure key components, the rate our customers deploy their networks, our ability to develop new products to meet market demand, and our ability to control costs. The Company undertakes no obligation to publicly update any forward-looking statements whether as a result of new information, future events or otherwise. We refer you to the documents the Company files from time to time with the Securities and Exchange Commission, specifically the Company's Registration Statement on Form S-1 filed in connection with its initial public offering. These documents contain and identify important factors that could cause actual results to differ materially from those contained in any forward-looking statements. About Accelerated Networks Accelerated Networks develops and markets multiservice broadband access products that enable telecommunications service providers A Telecommunications Service Provider or TSP is a type of Communications Service Provider that has traditionally provided telephone and similar services. This category includes ILECs, CLECs, and mobile wireless companies. to bundle voice and data services over a single broadband access network. These products are designed to allow service providers to efficiently and cost-effectively deliver and manage multiple voice and data services using 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 , T1, NxT1, or DS3 technologies. Accelerated's products also allow service providers to leverage emerging technologies such as voice over DSL (VoDSL) and frame relay A high-speed packet switching protocol used in wide area networks (WANs). Providing a granular service of up to DS3 speed (45 Mbps), it has become popular for LAN to LAN connections across remote distances, and services are offered by most major carriers. over DSL (FRoDSL) over a single broadband access network. Accelerated Networks offers all three components of a complete multiservice broadband access solution: NEBS-compliant regional POP voice gateways and central office concentrators, and customer premises premises n. 1) in real estate, land and the improvements on it, a building, store, shop, apartment, or other designated structure. The exact premises may be important in determining if an outbuilding (shed, cabana, detached garage) is insured or whether a person carrier-class integrated access devices 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). (IADs). For additional information, please visit www.acceleratednetworks.com.
ACCELERATED NETWORKS, INC.
SELECTED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
(in thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
Net revenue $ 8,770 $ 1,245 $ 15,922 $ 1,245
Cost of revenue 5,692 1,167 10,779 1,167
Gross profit 3,078 78 5,143 78
Operating expenses:
Research and product
development 5,540 2,200 9,690 4,667
Sales and marketing (A) 6,509 1,648 10,472 2,600
General and
administrative 1,325 420 2,119 809
Amortization of deferred
compensation 2,389 408 4,774 646
Total operating
expenses 15,763 4,676 27,055 8,722
Loss from operations (12,685) (4,598) (21,912) (8,644)
Interest and other
income (expense), net 620 378 1,005 579
Loss before provision
for income taxes (12,065) (4,220) (20,907) (8,065)
Provision for income
taxes - - 1 -
Net loss (12,065) (4,220) (20,908) (8,065)
Beneficial conversion
feature - - (9,882) -
Net loss applicable to
common stockholders $ (12,065) $ (4,220) $ (30,790) $ (8,065)
Basic and diluted net loss
per share applicable to
common stockholders $ (1.08) $ (0.69) $ (3.89) $ (1.36)
Shares used to compute
basic and diluted net
loss per share applicable
to common stockholders 11,213 6,153 7,909 5,923
Pro forma information:
Pro forma net
loss (A)(B) $ (8,291) $ (3,812) $ (14,749) $ (7,419)
Pro forma basic and
diluted net loss per
share (A)(B)(C) $ (0.19) $ (0.10) $ (0.36) $ (0.21)
Shares used in computing
pro forma basic and diluted
net loss per share (C) 43,588 37,803 40,663 34,920
(A) Included in sales and marketing expense is a $1,385 one-time
charge for a two-year warrant issued to US West. Pro forma basic and
diluted net loss and net loss per share applicable to common
stockholders excludes the effect of this charge.
(B) Pro forma basic and diluted net loss and net loss per share
applicable to common stockholders excludes the effect of the
amortization of deferred stock compensation and a one-time beneficial
conversion feature charge.
(C) Pro forma basic and diluted net loss per share assumes
conversion of the Company's preferred stock which converted to common
stock upon the closing of the Company's initial public offering as if
the conversion occurred as of the beginning of the period or the date
of issuance, if later.
ACCELERATED NETWORKS, INC.
SELECTED CONDENSED CONSOLIDATED BALANCE SHEET
(in thousands)
June 30, December 31,
2000 (unaudited) 1999
ASSETS
Current assets:
Cash and cash equivalents $ 103,853 $ 15,207
Accounts receivable, net 6,957 4,381
Inventories, net 3,917 3,811
Prepaids and other current assets 514 296
Total current assets 115,241 23,695
Net property and equipment 7,325 4,840
Other assets 171 143
Total assets $ 122,737 $ 28,678
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable and accrued
liabilities $ 8,748 $ 4,323
Debt, current 2,242 912
Deferred revenues 531 219
Total current liabilities 11,521 5,454
Debt, less current portion 219 1,932
Redeemable convertible preferred stock - 49,857
Stockholders' equity (deficit) 110,997 (28,565)
Total liabilities and stockholders'
equity $ 122,737 $ 28,678
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