Ixia Announces Record Revenues for the Third Quarter of 2005; Third Quarter Revenues Increase 40% and Net Income Increases 91% Year-Over-Year.CALABASAS, Calif. -- Ixia Ix´i`a n. 1. (Bot.) A South African bulbous plant of the Iris family, remarkable for the brilliancy of its flowers. Noun 1. (Nasdaq:XXIA) today reported financial results for the third quarter ended September September: see month. 30, 2005. Net revenues for the third quarter of 2005 were a record $42.1 million, which represents a year-over-year increase of 40% from the third quarter of last year. Net income on a GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). basis for the third quarter of 2005 was $9.1 million, or $0.13 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, a 91% increase when compared to net income of $4.7 million, or $0.07 per diluted share, for the third quarter of 2004. Ixia's third quarter of 2005 GAAP results included $1.3 million of non-cash charges Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. related to the amortization of acquired intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. and income tax benefits of $560,000 related to the tax effects of the amortization of the acquired intangible assets noted above and tax benefits related to previously recognized stock-based compensation. Excluding the effects of these items, non-GAAP net income for the third quarter of 2005 was $9.8 million, or $0.14 per diluted share, compared to $5.5 million, or $0.09 per diluted share, for the same period last year after excluding the effects of similar items. "The third quarter represented our 12th consecutive quarter of increasing sequential One after the other in some consecutive order such as by name or number. revenues and our 30th consecutive quarter of profitability," commented Errol Ginsberg Gins·berg , Allen 1926-1997. American poet and a leading figure of the Beat Generation. Known for his long incantatory works, his books include Howl (1956) and Kaddish (1961). Noun 1. , President and Chief Executive Officer of Ixia. "Demand during the period was strong from network equipment manufacturers and carriers, as the continued adoption of 10 Gigabit Ethernet An Ethernet standard that transmits at 1 Gbps. Used mostly to connect high-end workstations and servers as well as for network backbones, Gigabit Ethernet transmits full duplex from point to point using switches and half duplex in a shared environment (CSMA/CD) using a hub. and the accelerated roll-out of triple play services - voice, video and data over IP - continued to drive revenue. Geographically ge·o·graph·ic also ge·o·graph·i·cal adj. 1. Of or relating to geography. 2. Concerning the topography of a specific region. ge , we had record revenues in the U.S. and saw strong demand from Asia and 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). .""We were encouraged by the broad demand from our customer base, with over 70 companies placing six figure orders during the period. We believe this broad demand is a testament to the growing need for extensive pre-deployment testing of today's advanced networks with equipment that can generate wire speed traffic along with a sophisticated mix of real world traffic," added Mr. Ginsberg. During the third quarter ended September 30, 2005, Ixia increased cash, cash equivalents and investments by $6.4 million to approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $192 million. Ixia will host a conference call today for analysts and investors to discuss its quarterly results at 5:00 p.m. Eastern Time. Open to the public, a live Web cast of the conference call will be accessible from the "Investors" section of Ixia's Web site (www.ixiacom.com). Following the live Web cast, an archived version will be available in the "Investors" section on the Ixia Web site for 90 days. Non-GAAP Information Certain non-GAAP financial measures are included in this press release. These non-GAAP financial measures are provided to enhance the user's overall understanding of our financial performance. By excluding certain non-cash charges, as well as the related tax effects, our non-GAAP results provide information to both management and investors that is useful in assessing Ixia's core operating performance and in evaluating and comparing our results of operations on a consistent basis from period to period. These non-GAAP financial measures are also used by management to evaluate financial results and to plan and forecast future periods. The presentation of this additional information is not meant to be considered a substitute for the corresponding financial measures prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. 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 . Investors are encouraged to review the reconciliations of GAAP to non-GAAP financial measures which are included below. About Ixia Ixia is a leading, global provider of high performance IP network testing solutions. Its highly scalable solutions generate, capture, characterize, and emulate em·u·late tr.v. em·u·lat·ed, em·u·lat·ing, em·u·lates 1. To strive to equal or excel, especially through imitation: an older pupil whose accomplishments and style I emulated. 2. network and application traffic, establishing definitive performance and conformance con·for·mance n. Conformity. Noun 1. conformance - correspondence in form or appearance conformity agreement, correspondence - compatibility of observations; "there was no agreement between theory and metrics metrics Managed care A popular term for standards by which the quality of a product, service, or outcome of a particular form of Pt management is evaluated. See TQM. of network devices or systems under test. Ixia's testing solutions are used by network and telephony Meaning "sound over distance," it refers to electronically transmitting the human voice. In the beginning, telephony dealt only with analog signals in the circuit-switched networks of the telephone companies. equipment manufacturers, semiconductor manufacturers, service providers, governments, and large enterprises to validate To prove something to be sound or logical. Also to certify conformance to a standard. Contrast with "verify," which means to prove something to be correct. For example, data entry validity checking determines whether the data make sense (numbers fall within a range, numeric data the functionality and reliability of complex IP networks, devices, and applications. Ixia's Real World Traffic(TM) Suite addresses the growing need to test applications and networks prior to deployment Installing, setting up, testing and running. This military term, which means the placement of troops and equipment in the field, is widely used with computers as an alternate to the word "implementation. under realistic load conditions. Ixia's analysis solutions utilize a wide range of industry-standard interfaces and are distinguished by their performance, accuracy, reliability, and adaptability a·dapt·a·ble adj. Capable of adapting or of being adapted. a·dapt  a·bil to the
industry's constant evolution.For more information, contact Ixia at 26601 W. Agoura Road, Calabasas, CA 91302; (818) 871-1800, Fax: (818) 871-1805; Email: info@ixiacom.com or visit our Web Site at http://www.ixiacom.com Ixia, the Ixia four petal logo, ANVL ANVL Automated Network Validation Library , Chariot chariot, earliest and simplest type of carriage and the chief vehicle of many ancient peoples. The chariot was known among the Babylonians before the introduction of horses c.2000 B.C. and was first drawn by asses. The chariot and horse introduced into Egypt c.1700 B. , and Real World Traffic are either registered trademarks or trademarks of Ixia 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/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. other countries. Other trademarks used in this release are the trademarks or registered trademarks of their respective owners. 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. 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: Certain statements made in this press release are 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. , including, without limitation, statements regarding possible future revenues, growth and profitability and future business and market share. In some cases, such forward-looking statements can be identified by terms such as "may," "will," "expect," "plan," "believe," "estimate," "predict" or the like. Such statements reflect the Company's current intent, belief and expectations and are subject to risks and uncertainties that could cause the Company's actual results to differ materially from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. in the forward-looking statements. Factors that may cause future results to differ materially from the Company's current expectations include, among other things: consistency Consistency can refer to:
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 December: see month. 31, 2004. Ixia undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
IXIA
Condensed Consolidated Balance Sheets
(in thousands)
September 30, December 31,
2005 2004
------------- ------------
(unaudited)
Assets
Current assets:
Cash and cash equivalents $33,464 $16,383
Short-term investments in marketable
securities 125,891 81,757
Accounts receivable, net 33,662 22,069
Inventories 7,878 6,669
Deferred income taxes 3,582 3,756
Income taxes receivable 518 1,696
Prepaid expenses and other current assets 2,443 2,878
------------- ------------
Total current assets 207,438 135,208
Investments in marketable securities 32,954 49,015
Property and equipment, net 17,517 12,268
Deferred income taxes 12,373 4,798
Goodwill 13,468 11,377
Other intangible assets, net 21,757 23,031
Other assets 290 612
------------- ------------
Total assets $305,797 $236,309
============= ============
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $2,667 $1,556
Accrued expenses 11,896 13,181
Deferred revenues 8,048 7,032
Income taxes payable 4,732 4,203
------------- ------------
Total current liabilities 27,343 25,972
Deferred income taxes 4,594 3,411
------------- ------------
Total liabilities 31,937 29,383
------------- ------------
Shareholders' equity:
Common stock, without par value; 200,000
shares authorized, 66,231 and 62,459
shares issued and outstanding as of
September 30, 2005 and December 31, 2004,
respectively 123,811 100,144
Additional paid-in capital 68,349 53,247
Retained earnings 81,700 53,535
------------- ------------
Total shareholders' equity 273,860 206,926
------------- ------------
Total liabilities and shareholders'
equity $305,797 $236,309
============= ============
IXIA
Condensed Consolidated Statements of Income
(in thousands, except per share data)
(unaudited)
Three months Nine months
ended ended
September 30, September 30,
----------------- ------------------
2005 2004 2005 2004
-------- -------- --------- --------
Net revenues $42,134 $30,092 $121,874 $81,816
Cost of revenues(1) 6,685 5,382 18,879 14,644
Amortization of purchased
technology 991 836 2,876 2,207
-------- -------- --------- --------
Gross profit 34,458 23,874 100,119 64,965
-------- -------- --------- --------
Operating expenses:
Research and development 7,994 6,544 23,514 17,726
Sales and marketing 10,264 7,895 29,689 23,247
General and administrative 4,421 3,035 11,940 8,360
Amortization of intangible assets 316 373 944 1,161
Stock-based compensation(2) -- 14 -- 389
-------- -------- --------- --------
Total operating expenses 22,995 17,861 66,087 50,883
-------- -------- --------- --------
Income from operations 11,463 6,013 34,032 14,082
Interest and other, net 1,361 597 3,486 1,930
-------- -------- --------- --------
Income before income taxes 12,824 6,610 37,518 16,012
Income tax expense 3,754 1,871 9,353 4,705
-------- -------- --------- --------
Net income $9,070 $4,739 $28,165 $11,307
======== ======== ========= ========
Earnings per share:
Basic $0.14 $0.08 $0.43 $0.19
Diluted $0.13 $0.07 $0.41 $0.18
Weighted average number of common
and common equivalent shares
outstanding:
Basic 66,015 60,711 64,753 60,351
Diluted 69,923 63,856 69,281 64,311
(1)Stock-based compensation
included in:
Cost of revenues $-- $1 $-- $30
======== ======== ========= ========
(2)Stock-based compensation
related to:
Research and development $-- $8 $-- $271
Sales and marketing -- 5 -- 80
General and administrative -- 1 -- 38
-------- -------- --------- --------
$-- $14 $-- $389
======== ======== ========= ========
IXIA
Impact of Non-GAAP Adjustments on Net Income
(in thousands, except percentages and per share data)
(unaudited)
Three months ended
September 30, 2005
------------------------------------
GAAP Adjustments Non-GAAP
-------- ------------ ----------
Net revenues $42,134 $-- $42,134
Cost of revenues 6,685 -- 6,685
Amortization of purchased
technology 991 (991)(1) --
-------- ------------ ----------
Gross profit 34,458 991 35,449
-------- ------------ ----------
81.8% 84.1%
Operating expenses:
Research and development 7,994 -- 7,994
Sales and marketing 10,264 -- 10,264
General and administrative 4,421 -- 4,421
Amortization of intangible assets 316 (316)(1) --
-------- ------------ ----------
Total operating expenses 22,995 (316) 22,679
-------- ------------ ----------
54.6% 53.8%
Income from operations 11,463 1,307 12,770
Interest and other, net 1,361 -- 1,361
-------- ------------ ----------
Income before income taxes 12,824 1,307 14,131
Income tax expense 3,754 560 (2) 4,314
-------- ------------ ----------
Net income $9,070 $747 $9,817
======== ============ ==========
Earnings per share:
Basic $0.14 $0.01 (3) $ 0.15
Diluted $0.13 $0.01 (3) $ 0.14
Weighted average number of common
and common equivalent shares
outstanding:
Basic 66,015 -- 66,015
Diluted 69,923 -- 69,923
(1) The adjustment primarily represents the amortization of intangible
assets related to the acquisition of the ANVL(TM) product line from
Empirix, Inc., the acquisition of certain rights associated with the
Chariot(R) product line from NetIQ Corporation, and the acquisitions
of G3 Nova Technologies, Inc. and Communication Machinery
Corporation.
(2) The adjustment represents the income tax effects of footnote (1)
and the elimination of tax benefits related to previously recognized
stock-based compensation.
(3) The adjustment represents the earnings per share effect of the
adjustments noted in footnotes (1) and (2).
IXIA
Impact of Non-GAAP Adjustments on Net Income
(in thousands, except percentages and per share data)
(unaudited)
Three months ended
September 30, 2004
-------------------------------------
GAAP Adjustments Non-GAAP
-------- --------------- ----------
Net revenues $30,092 $-- $30,092
Cost of revenues 5,382 (1)(1) 5,381
Amortization of purchased
technology 836 (836)(2) --
-------- --------------- ----------
Gross profit 23,874 837 24,711
-------- --------------- ----------
79.3% 82.1%
Operating expenses:
Research and development 6,544 -- 6,544
Sales and marketing 7,895 -- 7,895
General and administrative 3,035 -- 3,035
Amortization of intangible
assets 373 (373)(2) --
Stock-based compensation 14 (14)(1) --
-------- --------------- ----------
Total operating expenses 17,861 (387) 17,474
-------- --------------- ----------
59.4% 58.1%
Income from operations 6,013 1,224 7,237
Interest and other, net 597 -- 597
-------- --------------- ----------
Income before income taxes 6,610 1,224 7,834
Income tax expense 1,871 503 (3) 2,374
-------- --------------- ----------
Net income $4,739 $721 $5,460
======== =============== ==========
Earnings per share:
Basic $0.08 $0.01 (4) $ 0.09
Diluted $0.07 $0.02 (4) $ 0.09
Weighted average number of common
and common equivalent shares
outstanding:
Basic 60,711 -- 60,711
Diluted 63,856 -- 63,856
(1) The adjustment represents stock-based compensation related to
stock options granted prior to our IPO in October 2000.
(2) The adjustment primarily represents the amortization of intangible
assets related to the acquisition of the ANVL(TM) product line from
Empirix, Inc., the acquisition of certain rights associated with the
Chariot(R) product line from NetIQ Corporation, and the acquisition of
G3 Nova Technologies, Inc.
(3) The adjustment represents the income tax effects of footnotes (1)
and (2), and the elimination of tax benefits related to previously
recognized stock-based compensation.
(4) The adjustment represents the earnings per share effect of the
adjustments noted in footnotes (1), (2) and (3).
IXIA
Impact of Non-GAAP Adjustments on Net Income
(in thousands, except percentages and per share data)
(unaudited)
Nine months ended
September 30, 2005
--------------------------------------
GAAP Adjustments Non-GAAP
--------- -------------- ----------
Net revenues $121,874 $-- $121,874
Cost of revenues 18,879 -- 18,879
Amortization of purchased
technology 2,876 (2,876)(1) --
--------- -------------- ----------
Gross profit 100,119 2,876 102,995
--------- -------------- ----------
82.1% 84.5%
Operating expenses:
Research and development 23,514 -- 23,514
Sales and marketing 29,689 -- 29,689
General and administrative 11,940 -- 11,940
Amortization of intangible
assets 944 (944)(1) --
--------- -------------- ----------
Total operating expenses 66,087 (944) 65,143
--------- -------------- ----------
54.2% 53.5%
Income from operations 34,032 3,820 37,852
Interest and other, net 3,486 -- 3,486
--------- -------------- ----------
Income before income taxes 37,518 3,820 41,338
Income tax expense 9,353 3,569 (2) 12,922
--------- -------------- ----------
Net income $28,165 $251 $28,416
========= ============== ==========
Earnings per share:
Basic $0.43 $0.01 (3) $ 0.44
Diluted $0.41 $-- $0.41
Weighted average number of
common and common equivalent
shares outstanding:
Basic 64,753 -- 64,753
Diluted 69,281 -- 69,281
(1) The adjustment primarily represents the amortization of intangible
assets related to the acquisition of the ANVL(TM) product line from
Empirix, Inc., the acquisition of certain rights associated with the
Chariot(R) product line from NetIQ Corporation, and the acquisitions
of G3 Nova Technologies, Inc. and Communication Machinery Corporation.
(2) The adjustment represents the income tax effects of footnote (1)
and the elimination of tax benefits related to previously recognized
stock-based compensation.
(3) The adjustment represents the earnings per share effect of the
adjustments noted in footnotes (1) and (2).
IXIA
Impact of Non-GAAP Adjustments on Net Income
(in thousands, except percentages and per share data)
(unaudited)
Nine months ended
September 30, 2004
-------------------------------------
GAAP Adjustments Non-GAAP
-------- -------------- ----------
Net revenues $81,816 $-- $81,816
Cost of revenues 14,644 (30)(1) 14,614
Amortization of purchased
technology 2,207 (2,207)(2) --
-------- -------------- ----------
Gross profit 64,965 2,237 67,202
-------- -------------- ----------
79.4% 82.1%
Operating expenses:
Research and development 17,726 -- 17,726
Sales and marketing 23,247 -- 23,247
General and administrative 8,360 -- 8,360
Amortization of intangible
assets 1,161 (1,161)(2) --
Stock-based compensation 389 (389)(1) --
-------- -------------- ----------
Total operating expenses 50,883 (1,550) 49,333
-------- -------------- ----------
62.2% 60.3%
Income from operations 14,082 3,787 17,869
Interest and other, net 1,930 -- 1,930
-------- -------------- ----------
Income before income taxes 16,012 3,787 19,799
Income tax expense 4,705 1,657 (3) 6,362
-------- -------------- ----------
Net income $11,307 $2,130 $13,437
======== ============== ==========
Earnings per share:
Basic $0.19 $0.03 (4) $ 0.22
Diluted $0.18 $0.03 (4) $ 0.21
Weighted average number of common
and common equivalent shares
outstanding:
Basic 60,351 -- 60,351
Diluted 64,311 -- 64,311
(1) The adjustment represents stock-based compensation related to
stock options granted prior to our IPO in October 2000.
(2) The adjustment primarily represents the amortization of intangible
assets related to the acquisition of the ANVL(TM) product line from
Empirix, Inc., the acquisition of certain rights associated with the
Chariot(R) product line from NetIQ Corporation, and the acquisition of
G3 Nova Technologies, Inc.
(3) The adjustment represents the income tax effects of footnotes (1)
and (2), and the elimination of tax benefits related to previously
recognized stock-based compensation.
(4) The adjustment represents the earnings per share effect of the
adjustments noted in footnotes (1), (2) and (3).
|
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion