Acterna Corporation Reports Second Quarter Earnings.Business/Technology Editors BURLINGTON Burlington, town, Canada Burlington, town (1991 pop. 129,575), SE Ont., Canada, on Lake Ontario. First settled (1798) by Mohawk Loyalist Joseph Brandt, Burlington's economy was built on the shipment of wheat, lumber, and quarried rock by waterway. , Mass.--(BUSINESS WIRE)--Nov. 14, 2000 Acterna Corporation (Nasdaq: ACTR ACTR American Council of Teachers of Russian ACTR Actuator ACTR Association for Canadian Theatre Research ACTR A Christmas To Remember ACTR Assistant Contract Technical Representative (NMCI liaison) ), formerly Dynatech Corporation, the world's second largest provider of products used to test and optimize optimize - optimisation communications networks The transmission channels interconnecting all client and server stations as well as all supporting hardware and software. , reported its results for its second fiscal quarter ended September 30, 2000. 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 sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the for the second quarter of fiscal 2001 of $313 million increased 23 percent from $255 million for the same period last year. Pro forma EBITA EBITA Earnings Before Interest Taxes Amortization was $40 million including one-time integration expense of $6 million, which compared to $42 million a year ago. For the first half of fiscal 2001, pro forma net sales from continuing operations were $610 million, a 30 percent increase from $468 million for the same period a year ago. Pro forma EBITA of $72 million, which includes one-time integration expense of $10 million, increased 16 percent from $62 million a year ago. Pro forma net sales of communications test products in the second quarter of $285 million, which accounted for 91 percent of total pro forma net sales, increased 24 percent from $230 million in the prior year due to growth of optical transport, cable networks, and telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. systems and software products. Sales of optical transport ($99 million), cable networks ($43 million), and telecommunications systems and software ($23 million) products increased 118 percent, 44 percent, and 37 percent, respectively, from the same period a year ago. Similarly, for the first half of fiscal 2001 pro forma net sales of communications test products of $555 million, or 91 percent of total pro forma net sales, grew 32 percent from the same period last year on the strength of optical transport, cable networks, and telecommunications systems and software products. Six-month sales of optical transport products of $186 million increased 121 percent. Cable network product sales of $83 million grew 45 percent. Sales of telecommunications systems and software products increased 40 percent to $47 million from the same period a year ago. Sales of the aforementioned a·fore·men·tioned adj. Mentioned previously. n. The one or ones mentioned previously. aforementioned Adjective mentioned before Adj. 1. products represented 57 percent of total communication test sales, or $316 million, compared to 42 percent of total communication test sales, or $175 million, in the same period a year ago. The company's pro forma results referred to above have been restated to reflect all acquisitions and divestitures, including the acquisition of Wavetek Wandel Goltermann, Inc. in the first quarter ended June 30, 2000, and the acquisition of Cheetah Technologies in the second quarter ended September 30, 2000. Pro forma EBITA referred to above excludes the effects of acquisition related charges, amortization, and recapitalization Recapitalization Restructuring a company's debt and equity mixture often with the aim of making a company's capital structure more stable. Notes: Companies often want to diversify their debt-to-equity ratio to improve liquidity. and other related costs. On an as-reported basis, second quarter sales were $305 million versus $104 million a year earlier. The reported net loss for the second quarter of fiscal 2001 was $50 million or a loss of $.27 per share on a fully 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. basis, compared to net income of $10 million or $.06 per share on a fully diluted basis for the same period a year ago. First-half net sales on an as-reported basis were $513 million versus $195 million a year earlier. The reported net loss for the first half of fiscal 2001 was $133 million or a loss of $.75 per share on a fully diluted basis, compared to net income of $12 million or $.09 per share on a fully diluted basis for the same period a year ago. During the second quarter, the company completed the acquisition of Cheetah Technologies, Inc., a leading provider of broadband broadband Term describing the radiation from a source that produces a broad, continuous spectrum of frequencies (contrasted with a laser, which produces a single frequency or very narrow range of frequencies). network management systems sold to cable TV network operators around the world, for a purchase price, including assumed liabilities, of $165 million. About Acterna Corporation: Acterna Corporation is the world's second largest developer, manufacturer and marketer of instruments, systems, software and services to test, deploy, manage and optimize communications networks, equipment and services. With approximately 5,000 employees and a local presence in more than 80 countries, Acterna offers a broad range of products that test and manage the operational performance of converged networks The integration of the telephone system with IP-based data networks. See softswitch. (networking) converged network - A single network that can carry voice, video and data. , including optical transmission systems, data services, voice services, wireless services, cable services and video delivery. The company also supplies in-flight passenger information systems and video color correction Altering the colors in an image in order to print or display it properly or for special effects. Depending on the application, color correction can be a significant problem if the resulting image must be approved or a purchase is made because of color choice. systems through its AIRSHOW and da Vinci da Vinci Surgery A surgical robot for performing certain surgeries–eg, mitral valve repair and laparoscopic procedures–eg, cholecystectomy and gastric ulcer repair. See Laparoscopic surgery, Robotics, Surgical robot. Systems subsidiaries. Additional information about the company is available at www.acterna.com. This press release may 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. within the meaning of Section 27A of the Securities Act of 1933, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. , and Section 21E of the Securities Exchange Act of 1934, as amended, which reflect the Company's current judgment on certain issues. Because such statements apply to future events, they are subject to risks and uncertainties that could cause the actual results to differ materially. Important factors which could cause actual results to differ materially are described in the Company's reports 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. and 10-Q on file with the Securities and Exchange Commission.
Acterna Corporation
Pro forma Sales and EBITA (Operating Earnings Before Interest, Taxes,
and Amortization)
(Unaudited)
Excluding In-process R&D, Inventory step-up, Amortization of Unearned
Compensation, Amortization of Intangibles, Recapitalization
and other related costs
In thousands
of dollars
Three Months Ended Six Months Ended
Sept. 30, 2000 Sept. 30, 1999 Sept. 30, 2000 Sept. 30, 1999
Net sales $313,137 $255,449 $609,553 $467,859
EBITA $40,432 $41,767 $72,380 $62,308
Pro Forma Only, See Notes Below
The above pro forma amounts for the quarter ended September 30, 2000 have been adjusted to eliminate charges on a pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern basis of $6 million for purchased in-process R&D, $26 million in inventory step-up step-up A scheduled increase in the exercise or conversion price at which a warrant, an option, or a convertible security may be used to acquire shares of common stock. charges, and are before amortization of unearned compensation and intangibles. The above pro forma amounts for the six months ended September 30, 2000 have been adjusted to eliminate charges on a pretax basis of $56 million for purchased in-process R&D, $35 million in inventory step-up charges, and $9 million of recapitalization and other related costs, and are before amortization of unearned compensation and intangibles. The above pro forma amounts include one-time integration expense ($6 million and $10 million for the three months and six months ended September 30, 2000, respectively) which relate to rebranding, severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when , and additional consultants hired for the integration of Wavetek Wandel Goltermann, Inc. (WWG WWG World Wide Group (WWDB) WWG Windward Group WWG Weapons Working Group WWG Warranty Working Group WWG Weather Wing ). In the prior year, the pro forma results for the quarter ended September 30, 1999 have been adjusted to eliminate a restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. of $2 million, a recapitalization and other related charge of $1 million, and a charge for amortization of unearned compensation of $400 thousand. The pro forma results for the six months ended September 30, 1999 have been adjusted to eliminate a restructuring charge of $2 million, a recapitalization and other related charge of $14 million, and a charge for amortization of unearned compensation of $1 million. The above pro forma financial information has been restated to include the results of WWG, which was acquired on May 23, 2000, Cheetah Technologies, which was acquired on August 23, 2000, and certain other acquisitions as if these acquisitions had occurred at the beginning of the respective fiscal periods. Similarly, the pro forma information excludes the results of DataViews Corporation, which was divested in June 2000, and certain other divestitures. Prior period pro forma amounts have been restated and adjusted on a consistent basis. The following condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. consolidated statements of operations are reported on a historical basis.
Acterna Corporation
Condensed Consolidated Statements of Operations
(Unaudited)
In thousands of dollars, except per-share amounts
Three Months Ended Six Months Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2000 1999 2000 1999
Net sales $ 305,210 $ 103,789 $ 513,381 $ 194,583
Cost of sales 141,050 34,115 230,658 64,872
Gross margin 164,160 69,674 282,723 129,711
Selling, general & admin
expense 115,523 34,123 189,930 65,635
Product development
expense 38,672 13,194 64,883 25,338
Recapitalization and other
related costs -- -- 9,194 13,259
Purchased incomplete
technology 6,000 -- 56,000 --
Amortization of
intangibles 30,763 763 43,642 1,479
Total operating
expense 190,958 48,080 363,649 105,711
Operating income (loss) (26,798) 21,594 (80,926) 24,000
Interest expense (27,121) (12,592) (45,793) (25,440)
Interest income 1,111 601 1,708 1,300
Other income (expense) (1,365) 15 (2,684) (24)
Income (loss) from
continuing operations
before income taxes and
extraordinary item (54,173) 9,618 (127,695) (164)
Provision (benefit) for
income taxes (3,784) 3,976 (5,571) 260
Net income (loss) from
continuing operations
before extraordinary item (50,389) 5,642 (122,124) (424)
Discontinued operations:
Operating income, net of
income tax provision of
$2,625 and $7,818,
respectively -- 3,924 -- 12,541
Net income (loss) before
extraordinary item (50,389) 9,566 (122,124) 12,117
Extraordinary item, net of
income tax benefit
of $6,603 -- -- (10,659) --
Net income (loss) $ (50,389) $ 9,566 $(132,783) $ 12,117
Income (loss) per common
share - basic
Continuing operations $ (0.27) $ 0.04 $ (0.69) $ 0.00
Discontinued operations -- 0.03 -- 0.09
Extraordinary loss -- -- (0.06) --
Net income (loss) per
common share - basic $ (0.27) $ 0.07 $ (0.75) $ 0.09
Income (loss) per common
share - diluted
Continuing operations $ (0.27) $ 0.04 $ (0.69) (0.00)
Discontinued operations -- 0.02 -- 0.09
Extraordinary loss -- -- (0.06) --
Net income (loss) per
common share - diluted $ (0.27) $ 0.06 $ (0.75) $ 0.09
Weighted average number
of common shares:
Basic 189,003 147,841 177,279 147,532
Diluted 189,003 158,552 177,279 147,532
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