Digital Lightwave Reports Fourth-Quarter and Fiscal 2001 Results; Names Jim Green as Chief Operating Officer.Business Editors CLEARWATER, Fla.--(BUSINESS WIRE)--Jan. 29, 2002 Digital Lightwave(R), Inc. (Nasdaq:DIGL DIGL Device Independent Graphics Layer ), a leading provider of optical networking Communications between computers, telephones and other electronic devices using light. An optical network is far more reliable and has far greater potential transmission capacity than networking in the electrical domain. See optical fiber. products and technology, today announced its financial results for the fourth quarter and fiscal year ended December 31, 2001. Fourth-quarter 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 were $5.4 million, compared with $33.9 million for the fourth quarter of 2000. Net loss as reported was $12.8 million, or a loss of $0.41 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, compared with net income of $13.0 million, or $0.40 per diluted share, for the same quarter a year earlier. Fourth-quarter net loss included 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 $500,000 for a reduction in force announced on October 9, 2001, as well as a reserve for doubtful accounts of $4.8 million and a reserve for excess inventory of $2.8 million. Excluding the effects of the charge and the reserves, fourth-quarter net loss on a 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 basis was $4.7 million, or a loss of $0.15 per diluted share. Net sales for fiscal 2001 were $82.8 million, compared with $100.7 million for fiscal 2000. Net income as reported for the full year was $2.8 million, or $0.09 per diluted share, compared with $31.4 million, or $0.98 per diluted share, for the prior year. Excluding the effects of restructuring and litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. charges and reserves for doubtful accounts and excess inventory, pro forma net income for 2001 was $16.7 million, or $0.52 per diluted share. At December 31, 2001, the company's cash and cash equivalents were $51.0 million, up from $30.5 million at year-end 2000. "The second half of 2001 was challenging for Digital Lightwave, as we faced an uncertain economy and the impact of a sluggish telecommunications market on customers' capital expenditures," said Dr. Bryan Zwan, chairman, president and chief executive officer. "However, we have entered 2002 with new management; a leaner, more agile organization; improved operating efficiencies; and a refocus Verb 1. refocus - focus once again; The physicist refocused the light beam" focus - cause to converge on or toward a central point; "Focus the light on this image" 2. on the strategic product and market vision on which the company was founded. Although our visibility remains limited, we intend to manage the business through the current downturn, sustain our market leadership and emerge an even stronger competitor when the economy recovers." On January 15, 2002, Digital Lightwave announced additional cost reduction initiatives. These included a second reduction in force, for which the company expects to take a restructuring charge of up to $1.3 million in the first quarter of 2002, and the outsourcing of manufacturing and production for the Digital Lightwave product line. These actions are expected to reduce the company's 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. by approximately $16 million on an annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. basis. Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. Appointed Digital Lightwave also announced today the promotion of Jim Green
Born in Alabama, Green moved to Canada to avoid being drafted for the Vietnam War. to chief operating officer. Green joined the company in 1999 and most recently held the position of executive vice president of operations. Previously, he had been chief executive officer of Trillium trillium or wake-robin (trĭl`ēəm), any plant of the large genus Trillium, attractive spring wildflowers of the family Liliaceae (lily family), native to North America and E Asia. Industries, a provider of repair, technical support and supply management services, and vice president, operations, for the MATCO MATCO Military Air Traffic Coordinating Office(r) MATCO Markham Association of Townhome Condominium Owners (Canada) Electronics Group. Green's earlier career included a broad range of operations, sales, marketing, and supply chain management positions at Memorex Telex, Sensory, Atari, Datapoint, and Recognition Equipment. Green's appointment follows the election of company founder Dr. Zwan as chairman, president and chief executive officer on January 23 and the appointment of Mark Scott Mark Scott may refer to:
"We're very pleased with the new team that we've assembled to focus on driving sales, accelerating product time-to-market, developing new products, and pursuing new telecommunications market segments," said Dr. Zwan. "As COO, Jim Green will have day-to-day responsibility for engineering, production, marketing, quality, and global service and support. His immediate priority will be to ensure a smooth transition of our product line to outsourced manufacturing. "With Jim in place, I'll be able to spend more time on strategic direction, new market opportunities and product development," Dr. Zwan continued. "Having rescaled the business through restructuring, outsourcing and other cost reductions, we look forward to improving our revenue streams on a reduced expense base in 2002." Digital Lightwave management plans to hold a teleconference with the investment community today at 5:00 p.m. ET / 2:00 p.m. PT. This call will be webcast live and archived for two weeks at www.lightwave.com. In addition, a telephone replay will be available for two weeks at 703/326-3020, code number 5777762. About Digital Lightwave, Inc. Digital Lightwave serves the global fiber-optic networking industry with products and technology used to develop, monitor, maintain, and facilitate the management of high-speed communication networks. The company's product families include Network Information Computers(R) (NICs(R)), the industry's leading high-speed portable analyzers for multi-protocol, fiber-optic network installation and maintenance testing Maintenance testing is that testing which is performed to either identify equipment problems, diagnose equipment problems or to confirm that repair measures have been effective. It can be performed at either the system level (e.g., the HVAC system), the equipment level (e.g. , and Network Access Agents(TM) (NAAs(TM)), which provide network-integrated, centralized cen·tral·ize v. cen·tral·ized, cen·tral·iz·ing, cen·tral·iz·es v.tr. 1. To draw into or toward a center; consolidate. 2. performance monitoring and analysis for optical networks, including remote multi-channel DWDM (Dense WDM) The term given to wavelength division multiplexing (WDM) when significantly more channels were being added. Since WDM is increasingly more "dense" all the time, both terms are used synonymously. See WDM. DWDM - wavelength division multiplexing . Digital Lightwave also provides embedded Inserted into. See embedded system. optical diagnostic subsystems for OEM (Original Equipment Manufacturer) The rebranding of equipment and selling it. The term initially referred to the company that made the products (the "original" manufacturer), but eventually became widely used to refer to the organization that buys the products and applications and custom automated test systems. News and information are available at www.lightwave.com. This news release includes certain 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 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 current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. These risks and uncertainties include fluctuations in operating results and seasonality of sales, changes 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. and worldwide economy, fluctuations in capital expenditures within the telecommunications industry, our dependence on a limited number of products and uncertainties of the market for our planned products, technological change, our dependence on growth of the Internet, competition, our dependence on a limited number of major customers, our ability to reduce operating expenses, our dependence on contract manufacturers and suppliers, our dependence on key personnel, and our dependence on proprietary technology. For a further list and description of such risks and uncertainties, see the reports filed by Digital Lightwave with the Securities and Exchange Commission, including 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. Digital Lightwave undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Editor's Note Editor's Note (foaled in 1993 in Kentucky) is an American thoroughbred Stallion racehorse. He was sired by 1992 U.S. Champion 2 YO Colt Forty Niner, who in turn was a son of Champion sire Mr. Prospector and out of the mare, Beware Of The Cat. Trained by D. : Digital Lightwave(R), Network Information Computer(R), AnyBit(R), NIC (1) (Network Interface Card) See network adapter. See also InterNIC. (2) (New Internet Computer) An earlier Linux-based computer from The New Internet Computer Company (NICC), Palo Alto, CA. (R), NIC Plus(TM), Network Access Agent(TM), and NAA NAA Nomina Anatomica Avium. (TM) are trademarks of Digital Lightwave in the United States and/or in other countries.
Digital Lightwave, Inc.
Consolidated Statements of Operations
(Unaudited)
(In thousands, except share and per-share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------- -------------------
2001 2000 2001 2000
------- ------- ------ -------
Net sales $ 5,441 $ 33,921 $ 82,780 $ 100,675
Cost of goods sold 6,242 11,129 31,610 33,237
------- -------- --------- ---------
Gross profit (loss) (801) 22,792 51,170 67,438
Operating expenses:
Engineering
and development 3,473 3,272 14,985 14,092
Sales and
marketing 7,961 4,955 22,261 15,628
General and
administrative 1,632 2,100 8,063 7,085
Restructuring
charges 500 -- 500 --
Litigation charge -- -- 4,100 --
------- -------- --------- ---------
Total operating
expenses 13,566 10,327 49,909 36,805
Operating
income (loss) (14,367) 12,465 1,261 30,633
Other income, net 281 500 1,545 770
------- -------- --------- ---------
Income (loss)
before income taxes (14,086) 12,965 2,806 31,403
Benefit for
income taxes (1,243) -- -- --
------- -------- --------- ---------
Net income (loss) $(12,843) $ 12,965 $ 2,806 $ 31,403
========= ======== ========= =========
Per share of
common stock:
Basic income
(loss) per share $ (0.41) $ 0.43 $ 0.09 $ 1.06
========= ======== ========= =========
Diluted income
(loss) per share $ (0.41) $ 0.40 $ 0.09 $ 0.98
========= ======== ========= =========
Weighted average
common shares
outstanding 31,203,724 30,458,554 30,927,386 29,548,905
========== ========== ========== ==========
Weighted average
common and
common equivalent
shares outstanding 31,203,724 32,292,954 32,109,888 31,946,416
========== ========== ========== ==========
Digital Lightwave, Inc.
Consolidated Balance Sheets
(In thousands)
December 31, December 31,
2001 2000
---------- -----------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 51,044 $ 30,481
Accounts receivable,
less allowance of $5,900 and $250, 7,638 25,301
respectively
Inventories 16,565 13,048
Prepaid expenses
and other current assets 795 757
-------- --------
Total current assets 76,042 69,587
Property and equipment, net 9,917 8,910
Other assets 303 336
-------- --------
Total assets $ 86,262 $ 78,833
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable
and accrued liabilities $ 7,287 $ 10,610
Accrued litigation charge 4,100 --
-------- --------
Total current liabilities 11,387 10,610
Long-term liabilities 809 854
-------- --------
Total liabilities 12,196 11,464
-------- --------
Stockholders' equity:
Preferred stock -- --
Common stock 3 3
Additional paid-in capital 80,511 76,620
Accumulated deficit (6,448) (9,254)
-------- --------
Total stockholders' equity 74,066 67,369
-------- --------
Total liabilities
and stockholders' equity $ 86,262 $ 78,833
======== ========
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