Avici Systems Announces Second Quarter 2006 Results.NORTH BILLERICA Billerica (bĭlrĭ`kə), town (1990 pop. 37,609), Middlesex co., NE Mass., on the Concord River; settled 1637, inc. 1655. An important high-tech center, its manufactures include computer hardware and software, precision instruments, and , Mass. -- Avici The Avici (sometimes Avichi) Hell is considered to be among the lowest realms of Hell within Buddhism. People reborn into this Hell have generally committed one or more of the Five Grave Offenses:
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 : AVCI), today reported results for its second quarter and six-months ended June June: see month. 30, 2006. Gross revenue for the three and six-months ended June 30, 2006 was $25.3 million and $46.7 million, respectively, compared to $11.6 million and $22.4 million, respectively, for the three and six-month periods ended June 30, 2005. Revenue, net of common stock warrant discount, for the three and six-months ended June 30, 2006 was $25.3 million and $46.1 million respectively, compared to $11.1 million and $21.3 million for the three and six-months ended June 30, 2005. "Due to a surge See power surge. SURGE - Sorter, Updater, Report Generator, Etc. IBM 704, 1959. Sammet 1969, p.8. and acceleration acceleration, change in the velocity of a body with respect to time. Since velocity is a vector quantity, involving both magnitude and direction, acceleration is also a vector. In order to produce an acceleration, a force must be applied to the body. in demand this quarter's revenue and bottom line results have far exceeded our expectations and resulted in the company turning cash flow positive. We expect to continue to see strong revenue and bottom line results in 2006, but caution that the business conditions driving this increased demand can change significantly. As we have previously announced, we have restructured our business to be profitable at what we believe is a reasonable going forward revenue baseline The horizontal line to which the bottoms of lowercase characters (without descenders) are aligned. See typeface. baseline - released version over the near term in a multi-vendor environment, even though we expect that 2006 will substantially exceed those levels," said Bill Leighton Leighton is the name of a number of places:
GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). net income for the second quarter ended June 30, 2006 was $7.9 million, or $0.58 per share, compared to a GAAP net loss of $2.7 million, or $0.21 per share, in the prior year's second quarter ended June 30, 2005. GAAP net income in the 2006 period includes $1.0 million of costs associated with the first quarter restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). , partially offset by termination The point where a line, channel or circuit ends. See SCSI termination and hybrid. credits net of non-cash equity based charges of $0.4 million recognized upon the prospective adoption of Financial Accounting Standards Board Financial Accounting Standards Board (FASB) Board composed of independent members who create and interpret Generally Accepted Accounting Principles (GAAP). Opinion 123R, which now requires that the fair values of stock options be expensed in the Company's GAAP financial statements and credits of $0.1 million from the utilization utilization, n 1. the extent to which a given group uses a particular service in a specified period. Although usually expressed as the number of services used per year per 100 or per 1000 persons eligible for the service, utilization rates may be of certain inventory previously written off. GAAP net loss in the 2005 period was benefited by $1.8 million, reported as other income, from $1.3 million in proceeds and the reversal reversal n. the decision of a court of appeal ruling that the judgment of a lower court was incorrect and is reversed. The result is that the lower court which tried the case is instructed to dismiss the original action, retry the case, or is ordered to change its of certain previously established reserves in connection with the Company's favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. disposition Act of disposing; transferring to the care or possession of another. The parting with, alienation of, or giving up of property. The final settlement of a matter and, with reference to decisions announced by a court, a judge's ruling is commonly referred to as disposition, regardless of of a claim in bankruptcy claim in bankruptcy n. the written claim filed by persons or businesses owed money (creditors) by a party who files for bankruptcy (debtor) to benefit from the distribution if money becomes available. and $0.2 million from the utilization of certain inventory previously written off, partially offset by $0.5 million for non-cash equity based charge relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc common stock warrant discount. GAAP net income for the six-months ended June 30, 2006 was $2.6 million, or $0.19 per share, compared to a GAAP net loss of $8.3 million, or $0.64 per share, for the six-months ended June 30, 2005. GAAP net income for the six-months ended June 30, 2006 includes $7.7 million of special charges associated with the company's first quarter decision to restructure its business and re-align
Re-align is the follow-up EP to Stromkern's Armageddon. It includes a cover of "Anthrax" originally by Gang of Four. its cost structure, partially offset by termination credits net of non-cash equity based charges of $0.1 million recognized under Financial Accounting Standards Board Opinion 123R and credits of $0.2 million from the utilization of certain inventory previously written off. Special charges include $6.3 million of costs associated with the company's workforce reduction, the write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of certain contract distribution rights deemed impaired See assistive technology. and certain other costs associated with the company's decision to restructure its business and realign re·a·lign tr.v. re·a·ligned, re·a·lign·ing, re·a·ligns 1. To put back into proper order or alignment. 2. To make new groupings of or working arrangements between. its cost structure and an additional charge of $1.4 million for certain inventory considered in excess of anticipated future requirements. GAAP net loss for the six-months ended June 30, 2005 is net of $1.1 million for common stock warrant discount offset by $1.8 million in connection with a settlement of a claim in bankruptcy and $0.3 million of inventory credits. Non-GAAP net income (GAAP net income or loss excluding charges for restructuring, common stock warrant discount, certain stock based compensation, inventory and settlement credits) for the three months ended June 30, 2006 was $8.5 million, or $0.62 per share compared to Non-GAAP net loss of $4.1 million, or $0.32 per share in the second quarter of 2005. Non-GAAP net income for the six-months ended June 30, 2006 was $10.4 million, or $0.78 per share, compared to Non-GAAP net loss of $9.3 million or $0.73 per share for the prior year six-month period ended June 30, 2005. Cash, cash equivalents, short and long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has and restricted cash totaled $52.6 million at June 30, 2006. Avici will discuss these quarterly results as well as future business and financial expectations in an investor conference call today at 8:30 AM eastern daylight For other uses, see Daylight (disambiguation). Daylight or the light of day is the combination of all direct and indirect sunlight outdoors during the daytime (and perhaps twilight). savings time. The conference telephone number is (888) 639-6205. A replay of the conference call will be available after 11:15 AM. Replay information will be available at (800) 475-6701 (USA) access code: 834315. Replay of this call is also available on Avici's Web site, www.avici.com, along with a copy of this release. Avici is a trademark of Avici Systems Inc. This release contains information about Avici's future expectations, plans, and prospects, including Avici's expectations for annual gross revenues that constitute 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. for purposes 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 under 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. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated. Statements made with regard to interim results are not necessarily indicative indicative: see mood. of results that may be expected for future interim periods or for the full year. When used in this press release, the word "will", "expected" and other similar expressions are intended to identify such forward looking statements. Such risks and uncertainties include, but are not limited to, the impact of restructuring and realignment re·a·lign tr.v. re·a·ligned, re·a·lign·ing, re·a·ligns 1. To put back into proper order or alignment. 2. To make new groupings of or working arrangements between. , the amount and timing of the occurrence of related charges, risks associated with focusing on a core set of features and functionalities, market acceptance of Avici products, services and enhancements, dependence on our major customer, customer purchasing patterns and commitments, development of the market place, product development and enhancement, intensity of competition of other vendors, technological changes, reliance on distribution partners, risks associated with international expansion, and other risks set forth in Avici's filings with the Securities and Exchange Commission. Avici does not undertake any duty to update forward-looking statements.
AVICI SYSTEMS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
-------- --------
2006 2005 2006 2005
----------- ----------- ----------- -----------
Revenue:
Product $ 23,574 $ 10,460 $ 43,853 $ 19,985
Service 1,696 1,174 2,811 2,369
----------- ----------- ----------- -----------
Total gross
revenue 25,270 11,634 46,664 22,354
Less - Common stock
warrant discount -
Product -- (527) (527) (1,054)
----------- ----------- ----------- -----------
Net revenue 25,270 11,107 46,137 21,300
----------- ----------- ----------- -----------
Cost of revenue -
Product (1) 6,373 3,077 14,614 6,363
Cost of revenue -
Service 446 536 952 1,129
----------- ----------- ----------- -----------
Total cost of
revenue 6,819 3,613 15,566 7,492
----------- ----------- ----------- -----------
Gross margin 18,451 7,494 30,571 13,808
----------- ----------- ----------- -----------
Operating expenses:
Research and
development (2) 8,031 8,971 17,635 17,631
Sales and
marketing (2) 964 2,191 2,395 4,501
General and
administrative (2) 1,489 1,196 2,788 2,506
Stock-based
compensation (370) -- (115) -
Restructuring
expenses 1,006 -- 6,278 -
----------- ----------- ----------- -----------
Total
operating
expenses 11,120 12,358 28,981 24,638
----------- ----------- ----------- -----------
Income/(loss) from
operations 7,331 (4,864) 1,590 (10,830)
Other income -- 1,788 - 1,788
Interest income, net 565 395 984 758
----------- ----------- ----------- -----------
Net income/(loss) $ 7,896 $ (2,681) $ 2,574 $ (8,284)
=========== =========== =========== ===========
Net earnings/(loss)
per diluted share $ 0.58 $ (0.21) $ 0.19 $ (0.64)
=========== =========== =========== ===========
Weighted average
common shares used in
computing diluted net
income (loss) per
share 13,615,522 12,877,094 13,395,486 12,865,790
=========== =========== =========== ===========
(1) Includes inventory
charge and (credits),
as follows:
Inventory charge $ -- $ -- $ 1,382 $ -
=========== =========== =========== ===========
Credits from
utilization of
inventory previously
written off in 2001 $ (62) $ (160) $ (215) $ (323)
=========== =========== =========== ===========
(2) Excludes certain
non-cash, stock-based
compensation, as
follows:
Research and
development $ (176) $ - $ (46) $ -
Sales and
marketing (44) - (8) -
General and
administration (150) - (61) -
----------- ----------- ----------- -----------
$ (370) $ - $ (115) $ -
=========== =========== =========== ===========
AVICI SYSTEMS INC.
NON-GAAP CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
(Unaudited)
Note 1
Three Months Ended Six Months Ended
June 30, June 30,
-------- --------
2006 2005 2006 2005
----------- ----------- ----------- -----------
Revenue:
Product $ 23,574 $ 10,460 $ 43,853 $ 19,985
Service 1,696 1,174 2,811 2,369
----------- ----------- ----------- -----------
Total gross
revenue 25,270 11,634 46,664 22,354
Cost of revenue -
Product 6,435 3,237 13,447 6,686
Cost of revenue -
Service 446 536 952 1,129
----------- ----------- ----------- -----------
Total cost of
revenue 6,881 3,773 14,399 7,815
----------- ----------- ----------- -----------
Gross margin 18,389 7,861 32,265 14,539
----------- ----------- ----------- -----------
Operating expenses:
Research and
development 8,031 8,971 17,635 17,631
Sales and
marketing 964 2,191 2,395 4,501
General and
administrative 1,489 1,196 2,788 2,506
----------- ----------- ----------- -----------
Total
operating
expenses 10,484 12,358 22,818 24,638
----------- ----------- ----------- -----------
Income/(loss) from
operations 7,905 (4,497) 9,447 (10,099)
Interest income, net 565 395 984 758
----------- ----------- ----------- -----------
Non-GAAP net
income/(loss) $ 8,470 $ (4,102) $ 10,431 $ (9,341)
=========== =========== =========== ===========
Non-GAAP
earnings/(loss) per
diluted share $ 0.62 $ (0.32) $ 0.78 $ (0.73)
=========== =========== =========== ===========
Weighted average
common shares used
in computing diluted
net loss per share 13,615,522 12,877,094 13,395,486 12,865,790
=========== =========== =========== ===========
Note 1 - The above non-GAAP consolidated statements of operations
for the three and six months ended June 30, 2006 and 2005 are not
presented in accordance with generally accepted accounting
principles (GAAP) and are presented for informational purposes
only. These statements exclude the impact of restructuring
expenses, non-cash charges (credits) related to common stock
warrant discount and certain stock based compensation as well as
charges and credits related to excess inventory and credits
resulting from the assignment of a bankruptcy claim as presented
in the following reconciliation for the applicable periods. The
Company believes that this presentation of non-GAAP results
provides helpful information to both management and investors in
assessing our core operating performance. Such information should
not be considered superior to, in isolation from, or as a
substitute for results presented in accordance with generally
accepted accounting principles.
Three Months Ended Six Months Ended
June 30, June 30,
-------- --------
2006 2005 2006 2005
----------- ----------- ----------- -----------
Non-GAAP net
income/(loss) $ 8,470 $ (4,102) $ 10,431 $ (9,341)
Common stock warrant
discount -- (527) (527) (1,054)
Other Income -- 1,788 1,788
Restructuring
expenses (1,006) - (6,278) -
Certain non-cash
stock based
compensation 370 - 115 -
Inventory charge -- - (1,382) -
Utilization of
inventory previously
written-off 62 160 215 323
----------- ----------- ----------- -----------
GAAP net income
(loss) $ 7,896 $ (2,681) $ 2,574 $ (8,284)
=========== =========== =========== ===========
AVICI SYSTEMS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
June 30, December 31,
2006 2005
----------- -----------
(unaudited)
===========
Assets
Cash and marketable securities $ 50,644 $ 48,120
Inventories 3,978 8,172
Trade accounts receivable, net 13,174 6,122
Restricted cash 1,000 -
Other current assets 690 1,501
----------- -----------
Total current assets 69,486 63,915
Long-term investments 1,000 2,099
Property and equipment, net 7,436 9,306
Contract distribution rights - 2,107
Other non-current assets 243 243
----------- -----------
Total assets $ 78,165 $ 77,670
=========== ===========
Liabilities and Stockholders' Equity
Accounts payable and accrued expenses $ 9,023 $ 11,510
Deferred revenue 12,615 13,970
Stockholders' equity 56,527 52,190
----------- -----------
Total liabilities and stockholders'
equity $ 78,165 $ 77,670
=========== ===========
December 31, 2005 amounts are derived
from audited financial statements.
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