Airspan Networks Announces Fourth Quarter and Full Year 2004 Financial Results; Record Sales and Net Profit for the Quarter.BOCA RATON Boca Raton (bō`kə rətōn`), city (1990 pop. 61,492), Palm Beach co., SE Fla., on the Atlantic; inc. 1925. Boca Raton is a popular resort and retirement community that experienced significant industrial development in the 1970s and 80s. , Fla. -- Airspan Airspan (NASDAQ:AIRN) is a [WIMAX] equipment manufacturer founded in 1998 with an R&D facility in the UK. The first product, AS4020 platform, was based on CDMA radio technology adapted for fixed wireless access and was a market success especially in developing markets. Networks Inc. (Nasdaq:AIRN) today announced fourth quarter financial results for the period ending December December: see month. 31, 2004. The Company reported revenues for the fourth quarter of $37.5 million, up 42% from the third quarter of 2004 and up 316% versus the fourth quarter of 2003. The net profit attributable to common stockholders for the fourth quarter was $0.07 per share on a 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, versus a loss of $(0.09) per share in the third quarter of 2004 and a loss of $(0.19) per share in the fourth quarter 2003. Full year reported revenues for 2004 were $94.6 million, over three times the $30.7 million of reported revenue in 2003. The net loss per share for the full year 2004 was $(0.27) versus $(0.84) for 2003. Business Highlights --Airspan continued to make substantial deliveries of Proximity products to Axtel Axtel S.A.B. de C.V. (BMV: AXTEL), is a Mexican telecommunications company, headquartered in Monterrey, that provides telecommunication products and services in Mexico. It is the main competitor of Telmex, who was a monopoly until very recently. in Mexico Mexico, city, Mexico Mexico or Mexico City, Span. Ciudad de México (Méjico), city (1990 pop. 8,236,960; 1991 met. area est. 20,899,000), central Mexico, capital and largest city of Mexico. . New Proximity orders were also placed by Lanka For the town of Lanka, please refer to Lanka, Assam Lanka (Sanskrit: लंका lankā, means "island") is the name given in Hindu mythology to the island fortress capital of the king Ravana in the epics Ramayana and Mahabharata, and Bell and Telstra in the fourth quarter. --Sales of the WipLL WipLL Wireless IP Local Loop product line reached their highest quarterly level. The product line continued to enjoy an increasing level of orders from customers in all geographic regions. In the past two years, the Years, The the seven decades of Eleanor Pargiter’s life. [Br. Lit.: Benét, 1109] See : Time Company has grown the customer base from an initial five customers to more than 200 direct and indirect customers, including over 65 in the USA. Significant repeat business occurred in the quarter in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). and Asia, while Airspan announced the signing of new
contracts with SES, Impsat and Newcom in Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. in the fourth
quarter.
--Cash, including restricted cash, stood at $68.0 million at the end of the fourth quarter, compared with $68.4 million at the end of the third quarter of 2004 and $35.5 million at the end of the fourth quarter of 2003. Cash spent on the business for the full year was approximately $1.0 million, down from $19.9 million in 2003. --Growing support for WiMAX (World Interoperability for Microwave Access, Inc., www.wimaxforum.org) An organization founded in 2001 that promotes the IEEE 802.16 wireless broadband standard and provides certification for devices for compliant devices. across the telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. industry was the backdrop Backdrop may refer to:
The company has developed a multi-core Digital Signal Processor. This integrates 250-300 individual DSP cores onto a single die (depending on the specific product). to deliver the first fully upgradeable reference designs for WiMAX base stations. --The Company announced its intention in the fourth quarter to acquire Arelnet for $8.7M in cash and stock. Arelnet's leading capabilities in Voice over IP softswitch A programmable network switch that can process the signaling for all types of packet protocols. Also known as a "media gateway controller," "call agent" or "call server," such devices are used by carriers that support converged communications services by integrating SS7 telephone and media gateways are expected to strengthen the Airspan WiMAX product offerings. The acquisition is expected to be accretive for the year and to close early in the second quarter of 2005. Financial Results Fourth quarter revenue of $37.5 million was 42% higher than the $26.5 million recorded for the third quarter of 2004 and 316% higher than the $9.0 million in the fourth quarter of 2003. The Company recorded a gross profit of $10.5 million in the quarter. Gross profit as a percentage of revenue was 28%. This compared to a gross profit of $7.1 million, or 27%, for the third quarter of 2004 and a gross profit of $2.3 million, or 26% recorded for the fourth quarter of 2003. Full year 2004 revenues totaled $94.6 million, over three times the $30.7 million recorded in 2003. Gross profits for the year of $27.4 million were more than nine times the $3.0 million recorded in 2003. The Company's fourth quarter operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. of $10.4 million were $0.7 million lower than the third quarter's operating expenses. Net profit for the fourth quarter of 2004 was $3.3 million, or $0.07 per share, compared to a loss of $3.5 million, or $(0.09) per share, in the third quarter of 2004 and a loss of $6.7 million, or $(0.19) per share, in the fourth quarter of 2003. Full year 2004 net loss was $10.0 million, or $(0.27) per share, compared to $29.5 million, or $(0.84) per share, for 2003. In the fourth quarter of 2004 the Company recognized a tax credit of $2.0 million, relating primarily to losses given up for cash payments for research and development activities in the United Kingdom. The Company's cash balance, including restricted cash, stood at $68.0 million at the end of 2004. Cash grew in the year from $35.5 million at the end of 2003, due primarily to the sale of 73,000 shares of series A preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. for $29.2 million in the third quarter and the sale of 834,560 shares of treasury stock for $4.4 million in the fourth quarter. "We are very pleased to have exceeded our quarterly and full-year guidance and to have achieved profitability in the fourth quarter, as previously predicted," said Eric Stonestrom, Airspan's president and chief executive officer. "A fourth consecutive quarter of record revenues saw the top line grow by another 40%. This was achieved by strong performances across most of our product lines. At the same time we were able to reduce the level of operating expenses, while we continued to invest in the next-generation WiMAX platform. I'm proud of what we have been able to achieve in 2004. Our revenues have trebled versus 2003, and in 2004 we consistently narrowed the operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. quarter over quarter. We also spent approximately $1 million on operations for the full year 2004, ending the year with $68.0 million of cash and no long term debt, and well capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. to take advantage of the opportunities being presented by the growing market. We have established a strong and diverse portfolio of products and customers that, with the expected addition of the ArelNet portfolio, will continue to be the core of our business as we move towards the release of next-generation WiMAX products." "Reporting our first net profit from operations is a landmark event for the Company, and it was achieved by improvements in many areas," said Peter Aronstam, chief financial officer. "The top line continued to grow, driving gross profits higher. Operational expenses have stabilized sta·bi·lize v. sta·bi·lized, sta·bi·liz·ing, sta·bi·liz·es v.tr. 1. To make stable or steadfast. 2. as we deliver customer requirements more efficiently. Cash management is strong, with a low operational cash burn achieved by a continued emphasis on the collection of receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed and sound inventory management. These are all areas we will continue to focus on in 2005." Outlook Mr. Stonestrom also commented that the Company expects revenues for the first quarter to be in the range of $22 million, and to show growth in the first half of 2005 of 50% over the first half of 2004. The loss in the first quarter is expected to be in the range of $3.0 to $3.5 million. "We enter the new year with good prospects for growth in 2005, through organic expansion of our business, new acquisitions, and the introduction of WiMAX products." Investor Conference The Company has scheduled an investor conference call for 5 p.m. EST P.M. also p.m. or p.m. abbr. post meridiem Usage Note: By definition, 12 a.m. today. The dial-in numbers for the live conference call are as follows: US toll-free number is 1-866-814-1916; international access dial-in number is 1-703-639-1360. Reference the Airspan Networks quarterly conference call. There will be a live webcast of the conference call available on the Investors/Presentations section of the Airspan Web site at http://www.airspan.com. The webcast will also be distributed over CCBN's Investor Distribution Network to both institutional and individual investors. Individual investors can listen to the call through CCBN's individual investor center at http://www.companyboardroom.com or by visiting any of the investor sites in CCBN's Individual Investor Network such as America Online's Personal Finance Channel, Fidelity Investments Fidelity Investments is a group of privately held companies in the financial services industry. It is made up by two independent but closely cooperating companies, Fidelity Management and Research Corporation (FMR Co. (R) (http://www.fidelity.com) and others. Institutional investors Institutional Investor A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions. can access the call via CCBN's password protected event management site, StreetEvents (http://www.streetevents.com). For those who cannot listen to the live broadcast, an audio replay of the call will be available on the Airspan Web site for 30 days. The US toll-free number for the replay is 1-888-266-2081; international access number for the replay is 1-703-925-2533. Please use access code 622830. About Airspan Networks Inc. Airspan Networks provides wireless voice and data systems and solutions, including Voice Over IP (VoIP), to operators around the world in both licensed and unlicensed frequency bands between 700 MHz (MegaHertZ) One million cycles per second. It is used to measure the transmission speed of electronic devices, including channels, buses and the computer's internal clock. A one-megahertz clock (1 MHz) means some number of bits (16, 32, 64, etc. and 6 GHz, including both PCS (1) (Personal Communications Services) Refers to wireless services that emerged after the U.S. government auctioned commercial licenses in 1994 and 1995. This radio spectrum in the 1. and 3.5GHz international bands. Airspan has a strong product roadmap that includes offerings compliant with the new WiMAX 802.16-2004 standard, and software upgradeability to 802.16e from the time the WiMAX products are introduced. Airspan is on the Board and a founder member of the WiMAX Forum. The Company has deployments with more than 200 operators in more than 100 countries. Airspan's systems are based on radio technology that delivers excellent area coverage, high security and resistance to fading fading fading skin coloring. See Arabian fading syndrome (below). Declining in body condition, general health, activity and productivity. Arabian fading syndrome general health is unimpaired. . Airspan's systems can be deployed rapidly and cost effectively, providing an attractive alternative to traditional wired communications networks The transmission channels interconnecting all client and server stations as well as all supporting hardware and software. . Airspan also offers radio planning, network installation, integration, training and support services support services Psychology Non-health care-related ancillary services–eg, transportation, financial aid, support groups, homemaker services, respite services, and other services to facilitate the deployment and operation of its systems. Airspan is headquartered in Boca Raton, Florida Boca Raton ("bōkə rə-tōn") is a city in Palm Beach County, Florida incorporated in May 1925. As of the 2000 census, the city had a total population of 74,764; the 2006 population recorded by the U.S. Census Bureau was 86,396. with its main operations center The facility or location on an installation, base, or facility used by the commander to command, control, and coordinate all crisis activities. See also base defense operations center; command center. in Uxbridge, United Kingdom. More information on Airspan can be found at http://www.airspan.com This press release contains 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 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, including statements regarding our strategy, future operations, financial position, future revenues, projected costs, prospects, plans and objectives of management, may be deemed to be forward-looking statements. The words "targets", "anticipates," "believes," "estimates," "expects," "intends," "may," "plans," "projects," "will," "would" and similar expressions or negative variations thereof are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. There are a number of important factors that could cause actual results or events to differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make. Investors and others are therefore cautioned that a variety of factors, including certain risks, may affect our business and cause actual results to differ materially from those set forth in the forward-looking statements. These risk factors include, without limitation, (i) a slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. of expenditures by communication service providers; (ii) increased competition from alternative communication systems; (iii) the failure of our existing or prospective customers to purchase products as projected; (iv) our inability to successfully implement cost reduction or containment containment Strategic U.S. foreign policy of the late 1940s and early 1950s intended to check the expansionist designs of the Soviet Union through economic, military, diplomatic, and political means. It was conceived by George Kennan soon after World War II. programs; (v) a loss of any of our key customers; (vi) our ability to retain Axtel, Mexico, as our largest customer; and (vii) our ability to continue to sell the Proximity products on terms and conditions comparable to those currently utilized. The Company is also subject to the risks and uncertainties described in its filings with the Securities and Exchange Commission, including its 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, 2003. You should read those factors as being applicable to all related forward-looking statements wherever they appear in this press release. We do not assume any obligation to update any forward-looking statements.
Airspan Networks Inc
Consolidated Statements of Income
(in thousands except for share and per share data)
Three months ended Year to date
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
2003 2004 2003 2004
-------- -------- -------- --------
(unaudited) (unaudited)
Revenue $9,023 $37,523 $30,651 $94,647
Cost of revenue (6,332) (26,975) (22,945) (66,144)
Inventory provision (348) - (4,746) (1,099)
-------- -------- -------- --------
Gross profit 2,343 10,548 2,960 27,404
-------- -------- -------- --------
Operating expenses:
Research and
development 3,593 4,510 14,395 18,794
Sales and marketing 2,860 2,919 10,389 11,013
Bad debt provision 946 - 946 549
General and
administration 2,066 2,821 8,741 11,042
Amortization of
intangibles 41 144 172 723
Restructuring provision 431 - 750 413
-------- -------- -------- --------
Total operating
expenses 9,937 10,394 35,393 42,534
-------- -------- -------- --------
(Loss) / profit from
operations (7,594) 154 (32,433) (15,130)
Net interest and
other income 921 1,133 2,983 3,217
-------- -------- -------- --------
(Loss) / profit
before tax (6,673) 1,287 (29,450) (11,913)
-------- -------- -------- --------
Income tax
charge / (credit) 1 (1,988) 5 (1,938)
-------- -------- -------- --------
Net (loss) / profit $(6,674) $3,275 $(29,455) $(9,975)
======== ======== ======== ========
Net (loss) / profit
per share - basic $(0.19) $0.09 $(0.84) $(0.27)
Weighted
average shares
outstanding -
basic 35,436,133 37,259,980 35,073,315 36,441,932
Net (loss) /
profit per
share - diluted $(0.19) $0.07 $(0.84) $(0.27)
Weighted average
shares
outstanding -
diluted 35,436,133 47,005,638 35,073,315 36,441,932
Airspan Networks Inc
Consolidated Balance Sheets
(in thousands)
December 31, 2003 December 31, 2004
----------------- -----------------
(unaudited)
ASSETS
Current Assets
Cash and cash equivalents $33,926 $66,296
Restricted cash 1,588 1,687
Accounts receivable 12,509 20,947
Unbilled accounts receivable 54 43
Inventory 18,215 12,834
Prepaid expenses and other
current assets 4,570 5,702
----------- -----------
Total Current Assets 70,862 107,509
Property, plant and equipment, net 3,736 3,707
Goodwill, net 3,136 789
Intangible assets, net 4,554 1,672
Long-term accounts receivable - 305
Other non-current assets 984 1,216
----------- -----------
Total Assets $83,272 $115,198
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable $7,751 $24,615
Accrued taxes 449 653
Deferred revenue 989 627
Customer Advances 15,070 4,789
Other accrued expenses 10,000 11,349
----------- -----------
Total Current Liabilities 34,259 42,033
----------- -----------
Stockholders' Equity
Preferred Stock - -
Common stock 11 11
Note receivable - stockholder (130) (87)
Additional paid in capital 215,209 249,917
Treasury stock (797) -
Other comprehensive income 1,839 418
Accumulated deficit (167,119) (177,094)
----------- -----------
Total Stockholders' Equity 49,013 73,165
----------- -----------
----------- -----------
Total Liabilities and
Stockholders' Equity $83,272 $115,198
=========== ===========
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