Centillium Communications Announces 52% Increase in Sequential Quarterly Revenues.Business Editors/High-Tech Writers FREMONT Fremont (frē`mŏnt). 1 City (1990 pop. 173,339), Alameda co., W Calif., on San Francisco Bay; inc. 1956. Long an agricultural center, with champagne vineyards founded (1870) by Leland Stanford, it still ships fruits and vegetables. , Calif.--(BUSINESS WIRE)--July 23, 2002 Centillium Communications, Inc. (Nasdaq:CTLM CTLM Imaging Computed tomography laser mammography A diagnostic technique using lasers to produce a 3-D cross-sectional image of the breast without x-rays. See Mammography. ), innovator 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). communications technology Noun 1. communications technology - the activity of designing and constructing and maintaining communication systems engineering, technology - the practical application of science to commerce or industry , today reported its second quarter 2002 financial results. Revenues for the quarter ended June June: see month. 30, 2002 were $34.4 million, compared with revenues of $22.6 million for the quarter ended March 31, 2002 and revenues of $46.4 million for the second quarter of 2001. Second quarter 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 was $3.3 million, or $0.09 per share, compared to a pro forma net loss of $8.4 million, or $0.25 per share, for the first quarter of 2002 and pro forma net income of $4.0 million, or $0.11 per share, for the second quarter of 2001. Revenues for the six months ended June 30, 2002 were $57.0 million, compared with revenues of $78.2 million for the six months ended June 30, 2001. The pro forma net loss for the six-month period was $11.7 million, or $0.34 per share, compared with pro forma net income of $4.4 million, or $0.12 per share, for the same six-month period in 2001. Pro forma results exclude purchased in-process research and development, recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. deferred stock compensation, certain other stock compensation, payroll tax Payroll Tax Tax an employer withholds and/or pays on behalf of their employees based on the wage or salary of the employee. In most countries, including the U.S., both state and federal authorities collect some form of payroll tax. expense related to employee stock option exercises, the amortization of acquisition related intangibles and a one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. gain related to the sale of a 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. investment. In addition, the second quarter 2002 pro forma net loss excludes a $2.7 million charge for product obsolescence ob·so·les·cent adj. 1. Being in the process of passing out of use or usefulness; becoming obsolete. 2. Biology Gradually disappearing; imperfectly or only slightly developed. . Under 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 (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ), which include these items, net loss for the second quarter of 2002 was $7.4 million, or $0.21 per share, compared to a net loss of $755,000, or $0.02 per share, for the second quarter of 2001, and net loss for the six months ended June 30, 2002 was $17.5 million, or $0.51 per share, compared to a net loss of $14.2 million, or $0.43 per share, for the six months ended June 30, 2001. "Our second quarter results benefited from both the sustained growth of 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 subscribers in Japan and the need for DSL service providers and equipment manufacturers to replenish re·plen·ish v. re·plen·ished, re·plen·ish·ing, re·plen·ish·es v.tr. 1. To fill or make complete again; add a new stock or supply to: replenish the larder. 2. their inventories to accommodate increasing demand for DSL services in Japan," commented Faraj Aalaei, Chief Executive Officer and co-founder of Centillium. There were approximately 922,000 new DSL subscribers in Japan during the second quarter of 2002, compared with 854,000 new subscribers during the first quarter and 221,000 new subscribers during the second quarter of last year. Total DSL subscribers in Japan now number approximately 3.3 million, compared with only 291,000 one year ago. As the DSL subscriber base in Japan has expanded, consumer appetite for even higher Internet access See how to access the Internet. speeds continues to grow. To meet this demand for even greater bandwidth, Centillium is incorporating its eXtremeDSL(TM) technology into its DSL products. eXtremeDSL technology allows service providers to increase their service area by more than 50% and increase their downstream From the provider to the customer. Downloading files and Web pages from the Internet is the downstream side. The upstream is from the customer to the provider (requesting a Web page, sending e-mail, etc.). transmission to rates as high as 12 megabits per second (unit) megabits per second - (Mbps, Mb/s) Millions of bits per second. A unit of data rate. 1 Mb/s = 1,000,000 bits per second (not 1,048,576). E.g. Ethernet can carry 10 Mbps. . "Our Palladia pal·la·di·a n. A plural of palladium2. (TM) family of next generation bridge and router router Portable electric power tool used in carpentry and furniture making that consists of an electric motor, a base, two handle knobs, and bits (cutting tools). A router can cut fancy edges for shelving, grooves for storm windows and weather stripping, circles and ovals products incorporates the performance enhancements of eXtremeDSL technology and provides significant cost benefits through the further integration of hardware and software. The demand for these benefits is motivating our customers to quickly incorporate Palladia chipset A group of chips designed to work as a unit to perform a function. For example, a modem chipset contains all the primary circuits for transmitting and receiving. A PC chipset provides the electronic interfaces between all subsystems (see PC chipset for illustration). solutions into their products and rapidly bring these upgraded customer premises equipment See CPE. products into production," said Aalaei. For central office DSL applications, Centillium recently introduced the next generation CopperFlite(TM) LX chipset See Intel chipsets. , which also incorporates Centillium's eXtremeDSL technology and provides further savings in power consumption and line card area. About Centillium Communications Centillium Communications, Inc. combines technical innovation and customer commitment to make broadband communications -- in business and at home -- a practical reality. The Company designs and markets communications chipsets for Digital Subscriber Line See DSL. (communications, protocol) Digital Subscriber Line - (DSL, or Digital Subscriber Loop, xDSL - see below) A family of digital telecommunications protocols designed to allow high speed data communication over the existing copper telephone lines between end-users and (DSL) central office and customer premises equipment and for carrier- and enterprise-class Voice over Packet (VoP) gateways and switches. The Centillium Communications headquarters are located at 47211 Lakeview There are a number of cities, towns, and regions known as Lakeview: Canada
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. This press release contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from those indicated by such forward-looking statements based on a variety of risks and uncertainties, including the risks and uncertainties relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc rate and breadth of deployment of broadband access See broadband and wireless broadband. in general and Centillium's DSL technology solutions in particular; the effects of the introduction of additional DSL standards in Japan, including whether the version of DSL employed by the Company will remain dominant; Centillium's ability to continue and expand on its relationships with communications equipment manufacturers; and the successful development and market acceptance of Centillium's new products. The Company assumes no obligation to update these forward-looking statements to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" . Information about potential factors that could affect Centillium's financial results is included in Centillium's 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. and most recent Quarterly Report on Form 10-Q Form 10-Q See 10-Q. , on file with the Securities and Exchange Commission. Centillium Communications, CopperFlite, eXtremeDSL, Palladia and the Centillium Logo are trademarks of Centillium Communications, Inc. All rights reserved.
Centillium Communications, Inc.
Pro Forma Condensed Consolidated Statements of Operations - Unaudited
(In thousands, except per share data)
For the For the
Three Months Ended Six Months Ended
------------------------------------------------
6/30/02 3/31/02 6/30/01 6/30/02 6/30/01
------------------------------------------------
Net revenues $ 34,413 $ 22,606 $ 46,371 $ 57,019 $ 78,226
Cost of revenues 18,507 11,969 23,126 30,476 38,971
-------- -------- -------- -------- --------
Gross profit 15,906 10,637 23,245 26,543 39,255
Gross Profit % 46% 47% 50% 47% 50%
Operating expenses:
Research and
development 13,607 12,672 11,681 26,279 23,204
Sales and marketing 3,926 4,411 4,178 8,337 7,533
General and
administrative 2,113 2,446 3,098 4,559 5,016
-------- -------- -------- -------- --------
Total operating
expenses 19,646 19,529 18,957 39,175 35,753
-------- -------- -------- -------- --------
Operating income
(loss) (3,740) (8,892) 4,288 (12,632) 3,502
Interest and
other, net 502 510 937 1,012 2,099
Loss on long-term
investment - - (990) - (990)
-------- -------- -------- -------- --------
Income (loss) before
income taxes (3,238) (8,382) 4,235 (11,620) 4,611
Provision for income
taxes 27 24 205 51 234
-------- -------- -------- -------- --------
Pro forma net income
(loss) $ (3,265) $ (8,406) $ 4,030 $(11,671) $ 4,377
======== ======== ======== ======== ========
Pro forma diluted
earnings (loss) per
Common share (a) $ (0.09) $ (0.25) $ 0.11 $ (0.34) $ 0.12
======== ======== ======== ======== ========
Weighted average
common shares
outstanding,
assuming dilution 34,538 34,294 37,362 34,416 37,251
======== ======== ======== ======== ========
(a) Pro forma net loss per share does not consider the impact of
common stock equivalents.
The pro forma Consolidated Statements of Operations exclude purchased
in-process research and development, recurring deferred stock
compensation, certain other stock compensation, payroll tax expense
related to employee stock option exercises, the amortization of
acquisition related intangibles and a one-time gain related to the
sale of a long-term investment. In addition, the second quarter 2002
pro forma net loss excludes a charge for product obsolescence. This
pro forma information is not prepared in accordance with generally
accepted accounting principles.
Centillium Communications, Inc.
Reconciliation of Pro Forma Adjustments - Unaudited
(In thousands)
For the For the
Three Months Ended Six Months Ended
------------------------------------------------
6/30/02 3/31/02 6/30/01 6/30/02 6/30/01
------------------------------------------------
Pro forma net
income (loss) $ (3,265) $ (8,406) $ 4,030 $(11,671) $ 4,377
======== ======== ======== ======== ========
Amortization of
deferred stock
compensation 1,392 1,811 3,912 3,203 9,433
Amortization of
goodwill and other
acquisition related
intangibles 41 42 821 83 1,642
Purchased in-process
research and
development - - - - 7,422
Product obsolescence 2,700 2,700
Stock based
compensation and
payroll tax expense
on option exercises 6 307 52 313 92
Gain on non-current
investment - (440) - (440) -
-------- -------- -------- -------- --------
GAAP net loss $ (7,404) $(10,126) $ (755) $(17,530) $(14,212)
======== ======== ======== ======== ========
Centillium Communications, Inc.
Condensed Consolidated Statements of Operations - Unaudited
(In thousands, except per share data)
For the For the
Three Months Ended Six Months Ended
------------------------------------------------
6/30/02 3/31/02 6/30/01 6/30/02 6/30/01
------------------------------------------------
Net revenues $ 34,413 $ 22,606 $ 46,371 $ 57,019 $ 78,226
Cost of revenues 21,283 12,066 23,315 33,349 39,486
-------- -------- -------- -------- --------
Gross profit 13,130 10,540 23,056 23,670 38,740
Operating expenses:
Research and
development 14,360 13,609 13,745 27,969 28,017
Sales and marketing 4,107 4,898 4,809 9,005 9,083
General and
administrative 2,501 3,043 4,178 5,544 7,663
Amortization of
goodwill and other
acquisition related
intangibles 41 42 821 83 1,642
In-process research
and development - - - - 7,422
-------- -------- -------- -------- --------
Total operating
expenses 21,009 21,592 23,553 42,601 53,827
-------- -------- -------- -------- --------
Operating loss (7,879) (11,052) (497) (18,931) (15,087)
Interest and other,
net 502 510 937 1,012 2,099
Gain (loss) on
long-term investment - 440 (990) 440 (990)
-------- -------- -------- -------- --------
Loss before
income taxes (7,377) (10,102) (550) (17,479) (13,978)
Provision for
income taxes 27 24 205 51 234
-------- -------- -------- -------- --------
Net loss $ (7,404) $(10,126) $ (755) $(17,530) $(14,212)
======== ======== ======== ======== ========
Basic and diluted net
loss per share $ (0.21) $ (0.30) $ (0.02) $ (0.51) $ (0.43)
======== ======== ======== ======== ========
Weighted average
shares of common
stock outstanding
used in computing
basic and diluted
net loss per share 34,538 34,294 33,426 34,416 33,101
======== ======== ======== ======== ========
Centillium Communications, Inc.
Summary Financial Data - Unaudited
(In thousands)
June 30, December 31,
Balance Sheet Data: 2002 2001
----------------------------
Cash, cash equivalents and
short-term investments $ 103,528 $ 110,853
Accounts receivable, net 6,527 4,042
Inventories 5,423 9,356
Other assets 20,214 19,957
--------- ---------
Total assets $ 135,692 $ 144,208
========= =========
Accounts payable $ 6,982 $ 7,854
Accruals and other
current liabilities 19,917 14,881
Other long-term liabilities 299 315
--------- ---------
Total liabilities 27,198 23,050
Total stockholders' equity 108,494 121,158
--------- ---------
Total liabilities and
stockholders' equity $ 135,692 $ 144,208
========= =========
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