Alvarion Reports First Quarter 2002 Results.Business Editors TEL-AVIV, Israel--(BUSINESS WIRE)--May 2, 2002 Alvarion Ltd. (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 : ALVR), a leading provider of Broadband Wireless See wireless broadband. Access (BWA (Broadband Wireless Access) High-speed wireless access. Typically refers to wireless last mile access to the Internet. See WiMAX and broadband. ) solutions, today announced its financial results for the first quarter ended March 31, 2002. Note: The Company's statement of operations See Income statement. is based on U.S. GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). . The Company was formed on August 1, 2001 through the merger of BreezeCOM Ltd. and Floware Ltd. As such, the Company's results for the first quarter of 2001 include the results of BreezeCOM Ltd. only. Revenues for the first quarter of 2002 (which, as noted above, include revenues from both the former BreezeCOM and the former Floware) were $22.7 million, compared with $25.2 million for the fourth quarter of 2001 (which also includes revenues from both former companies) and $23.9 million for the first quarter of 2001 (for BreezeCOM alone). Net loss for the first quarter of 2002 was $(5.5) million, or $(0.10) per share, compared with $(16.6) million, or $(0.30) per share, for the fourth quarter of 2001, and net income of $63,000 or $0.00 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, in the first quarter of 2001 (for BreezeCOM only). If amortization of current technology and deferred stock compensation ($752,000) were excluded from the Company's first quarter 2002 results, the net loss for the quarter would have been $(4.8) million, or $(0.09) per share. This compares with a net loss of $(5.6) million, or $(0.10) per share, in the fourth quarter of 2001, excluding amortization and other non-recurring expenses of $11.0 million. Alvarion Reports Q1 2002 Page 6 of 6 Cash reserves Cash reserves See: Cash investments cash reserves Investment funds that are held in short-term assets such as Treasury bills and certificates of deposit until more permanent investment opportunities are available. as of March 31, 2002 were $179.2 million, compared with $183.0 million as of December 31, 2001. Commenting on the first quarter, Zvi Slonimsky, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Alvarion, stated, "We are pleased to report that our revenues and margins were in line with our forecasts. This, together with the significant decline in our 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. , enabled us to reduce our cash burn and net loss compared with the fourth quarter. Total operating expenses on a pro-forma basis for the first three months of 2002 were $15.0 million, compared with $16.6 million in the fourth quarter of 2001." "During the quarter, we shipped approximately 30,000 units of our products to established carriers and service providers in more than 70 countries around the world, enabling us to mark the milestone of the installation of our 500,000th unit. This accomplishment establishes Alvarion's positioning even more firmly as the leader of the BWA market. "Although visibility in the market is still low and lead times, especially for new projects, are still long, we are encouraged to see the reawakening reawakening n → despertar m reawakening n → réveil m reawakening n → Wiedererwachen nt of activity in many regions, and are cautiously optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op that the worst is behind us. During the quarter, a number of BWA projects were initiated by new customers, especially in the developing regions." Mr. Slonimsky continued, "We continue to invest in R&D. This quarter, we have progressed from the launch phase to the commercial deployment phase of three new products, namely, our pioneering BreezeACCESS(TM) OFDM (Orthogonal Frequency Division Multiplexing) A digital transmission technique that uses a large number of carriers spaced apart at slightly different frequencies. (Orthogonal At right angles. The term is used to describe electronic signals that appear at 90 degree angles to each other. It is also widely used to describe conditions that are contradictory, or opposite, rather than in parallel or in sync with each other. Frequency Division Multiplexing See FDM. (communications) frequency division multiplexing - (FDM) The simultaneous transmission of multiple separate signals through a shared medium (such as a wire, optical fibre, or light beam) by modulating, at the transmitter, the separate signals into separable ) solution, BreezeACCESS(TM) SU-R, and AlvariBase(TM), all of which have enjoyed a positive reception by new and existing customers. This wide variety of products improves our ability to address our customers' business model needs." Mr. Slonimsky concluded, "Overall, we are proud of our solid performance despite tough markets, and are optimistic as we look to the future. We are confident that our more comprehensive product offering and extensive market presence will enable us both to take full advantage of improving market trends, and to benefit from our leadership position in the BWA market." The Company will hold a teleconference today, May 2, 2002, at 9:00 a.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT to discuss the quarter's results. To participate in the call, please dial (877) 780-2276 (in the U.S.), or (973) 628-9554 (internationally), approximately five minutes prior to the scheduled call start time. This call will also be available live as a Webcast on www.kcsa.com and www.alvarion.com. The Webcast will be archived and available for replay for 30 days. About Alvarion Alvarion is a premier provider of solutions based on Point-to-Multipoint (PMP See point-to-multipoint and portable media player. PMP - Portable Media Player ) Broadband Wireless Access (BWA) used by telecom carriers, service providers, and enterprises worldwide. Alvarion systems provide Internet access See how to access the Internet. and voice and data services in the last mile, cellular network feeding, building-to-building and wireless local area network (LAN (Local Area Network) A communications network that serves users within a confined geographical area. The "clients" are the user's workstations typically running Windows, although Mac and Linux clients are also used. ) connectivity. Alvarion offers the broadest range of BWA solutions by market segment and frequency band, designed to address all carriers' and service providers' business models. With its combined market experience, strong customer base, diversified diversified (di·verˑ·s distribution channels and field-proven deployments, Alvarion is a leading BWA pure play provider for every end user profile, from residential subscribers to business customers. For more information, please visit Alvarion's web site at http://www.alvarion.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 the "safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These statements are based on the current expectations or beliefs of Alvarion's management and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: inability to further identify, develop and achieve success for new products, services and technologies; increased competition and its effect on pricing, spending, third-party relationships and revenues; as well as the inability to establish and maintain relationships with commerce, advertising, marketing, and technology providers and other risks detailed from time to time in filings with the Securities and Exchange Commission. You may register to receive Alvarion's future press releases or to download a complete Digital Investor Kit(TM) including press releases, regulatory filings and corporate materials by clicking on the "Digital Investor Kit(TM)" icon at www.kcsa.com.
ALVARION LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands
March 31, December 31,
2002 2001
ASSETS
Cash, cash equivalents,
short-term and long-term
investments $ 179,199 $ 182,969
Trade receivables 16,520 15,563
Other accounts receivable 5,807 9,273
Inventories 28,505 32,580
Severance pay fund 3,148 3,217
PROPERTY AND EQUIPMENT, NET 11,156 11,153
GOODWILL AND OTHER INTANGIBLE ASSETS 52,240 52,840
TOTAL ASSETS $ 296,575 $ 307,595
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Trade payables $ 7,916 $ 11,253
Other accounts payable
and accrued expenses 30,630 31,918
Total current liabilities 38,546 43,171
LONG TERM LIABILITIES 5,228 5,228
ACCRUED SEVERANCE PAY 4,828 4,945
TOTAL LIABILITIES 48,602 53,344
SHAREHOLDERS' EQUITY 247,973 254,251
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $ 296,575 $ 307,595
ALVARION LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except per share data)
Three Months Ended Three Months Ended
March 31, 2002 March 31, 2001
Sales $ 22,684 $ 23,891
Cost of sales 14,495 13,727
Gross profit 8,189 10,164
Operating expenses:
Research and development, net 6,724 4,179
Selling and marketing 6,692 7,132
General and administrative 1,548 1,308
Amortization of current technology &
deferred stock compensation 752 -
Total Operating expenses 15,716 12,619
Operating loss (7,527) (2,455)
Financial income, net 2,020 2,518
Net income (loss) $ (5,507) $ 63
Basic earnings (loss) per share $ (0.10) $ 0.00
Weighted average number of shares
used in computing basic earnings
(loss) per share 54,605 28,328
Diluted earnings (loss) per share $ (0.10) $ 0.00
Weighted average number of shares
used in computing diluted earnings
(loss) per share 54,605 32,819
ALVARION LTD.
(a) PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except per share data)
Three Months Ended Three Months Ended
March 31, March 31,
2002 2001
Sales $ 22,684 $ 23,891
Cost of sales 14,495 13,727
Gross profit 8,189 10,164
Operating expenses:
Research and development, net 6,724 4,179
Selling and marketing 6,692 7,132
General and administrative 1,548 1,308
Total Operating expenses 14,964 12,619
Operating loss (6,775) (2,455)
Financial income, net 2,020 2,518
Net income (loss) $ (4,755) $ 63
Basic earnings (loss) per share $ (0.09) $ 0.00
Weighted average number of shares
used in computing basic earnings
(loss) per share 54,605 28,328
Diluted earnings (loss) per share $ (0.09) $ 0.00
Weighted average number of shares
used in computing diluted earnings
(loss) per share 54,605 32,819
(a) The pro forma statement Pro forma statement A financial statement showing the forecast or projected operating results and balance sheet, as in pro forma income statements, balance sheets, and statements of cash flows. of operations excludes the amortization of current technology & deferred stock compensation. The above 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 information is for informational purposes only. It is not prepared in accordance 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 the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. (US GAAP) and should not be considered as a substitute for our historical financial information prepared in accordance with GAAP |
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