TANDBERG Reports Fourth Quarter 2006 Results.Revenue of 130.8 MUSD and Operating Profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. of 31.5 MUSD in 4Q06 OSLO, Norway & NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- TANDBERG[R] (OSLO:TAA TAA - Track Average Amplitude .OL), today announced unaudited financial results for the fourth quarter ended December 31, 2006. Overview of 4Q06: * Record revenue of 130.8 MUSD with volume of 12,744 units * Pre-tax profit of 32.5 MUSD * 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. reflect business momentum and continued investment * Solid cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses of 45.6 MUSD * Announcement of HP alliance and TANDBERG telepresence Meaning "long distance presence," it refers to videoconferencing applications that feel like a live meeting. Notable features are larger screens that may approach a virtual reality environment and sensors that keep at least one window focused on whomever is speaking at the moment. solution FINANCIALS Fourth quarter revenues were record high at 130.8 MUSD compared with 82.9 MUSD in the same quarter last year. Gross margin for the quarter was 66.6%, compared with 67.3% in the same quarter last year reflecting a stable pricing environment. Selling, general & administrative (SG&A) expenses for 4Q06 totaled 50.8 MUSD, compared with 35.1 MUSD in the same quarter last year. Operating profit was 31.5 MUSD compared with 18.2 MUSD in the same quarter last year. Earnings per share (after tax) were 0.214 USD USD In currencies, this is the abbreviation for the U.S. Dollar. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. in 4Q06 compared with 0.115 USD in the same quarter last year. For the year, revenue totaled 419.7 MUSD in 2006 compared with 345.2 MUSD in 2005. Operating profit was 94.9 MUSD for 2006 and 85.4 MUSD for 2005. The Company generated cash flow from operations of 45.6 MUSD in the quarter, which after investments of 15.3 MUSD and repurchase of shares of 27.3 MUSD, gave a total cash inflow of 3.0 MUSD. As of December 31, the Company had a cash balance of 149.6 MUSD and an equity ratio of 62.9%. OPERATIONS Discussing fourth quarter results, Fredrik Halvorsen, Chief Executive Officer, stated, "TANDBERG experienced consistent growth from 3Q to 4Q, taking advantage of its competitive edge in an expanding market. The Company has, and will continue to invest heavily in R&D, sales and operations. TANDBERG recently extended its offering at the very high end by announcing its own adaptive telepresence solution and an alliance with Hewlett Packard for joint marketing, interoperability and managed services An umbrella term for third-party monitoring and maintaining of computers, networks and software. The actual equipment may be inhouse or at the third-party's facilities, but the "managed" implies an ongoing effort; for example, making sure the equipment is running at a certain quality . These initiatives allow TANDBERG to establish a firm footprint in the telepresence space. The revenue mix included network sales of 13.7% (up from 10.5% in the same quarter last year) and service sales of 13.4% of total revenues (unchanged from the same quarter last year). Solid working capital management, with continued improvements in DSO See CSO. , is evident from the balance sheet. This, combined with the non-cash effects of IFRS IFRS International Financial Reporting Standard(s) IFRS Inter Frame Relay Service IFRS Indiana Facilities Registry System accounting for stock compensation, R&D costs, and service revenue deferrals, has allowed the company to generate strong cash flow from operations." MARKETS In 4Q06, TANDBERG sold 12,744 units compared with 8,478 units in the same quarter last year, a 50.3% increase. In 2006, 40,118 units were sold compared with 32,618 in 2005, a 23.0% increase. AMERICAS Revenue in the Americas Theatre during 4Q06 totaled 68.9 MUSD compared with 44.8 MUSD the same quarter last year. The sales performance was driven by solid execution across all territories in the enterprise sector. In addition, the momentum from a strong U.S. Federal buying season carried into 4Q. The Americas team continued to operate at high level of sales productivity. Total solution selling gained traction. Channel development in the Enterprise Sector remained a key focus for improvement. EMEA (Europe, Middle East, Africa) Refers to that region of the world. For example, one might see products packaged differently for the UK, EMEA and Asia Pacific markets. Revenue in EMEA during 4Q06 totaled 51.5 MUSD, compared with 29.5 MUSD in the same quarter last year. All regions performed well, with particularly strong growth in Northern Europe and UK. Emphasis on partner competence and solution sales began to show traction. A new Theatre President was appointed as of January 1, 2007. The EMEA team is a strong and mature organization, with a continuous focus on building competence internally and within the partner community. In 2007, the channel delivery model will be strengthened for total solution selling. ASIA Asia (ā`zhə), the world's largest continent, 17,139,000 sq mi (44,390,000 sq km), with about 3.3 billion people, nearly three fifths of the world's total population. PACIFIC Revenue in APAC APAC Australian Partnership for Advanced Computing APAC Agricultural Policy Analysis Center APAC Asia and Pacific APAC Asian Pacific American Coalition APAC Adapted Physical Activity Council (American Alliance for Health) during 4Q06 totaled 10.4 MUSD, compared with 8.6 MUSD in the same quarter last year. The Theatre experienced satisfactory performance in South Asia and Australia, and was at expectation but below potential in North Asia. The organizational structure is in place for a targeted and localized business approach across APAC. STRATEGIC INITIATIVES TANDBERG continues to focus on technology leadership and select technology-driven alliance partnerships. Expanding on this leadership, TANDBERG: * Broadened its portfolio at the very high end. On January 2, TANDBERG announced an alliance with HP for joint marketing, interoperability and managed services for enterprise-wide telepresence. The Company also introduced standards-based TANDBERG Experia, an adaptive telepresence solution. * Increased accessibility to visual communication. Customers now have the ability to make video presentations portable on Microsoft Zune and the ability to embed video collaboration to enrich Microsoft Sharepoint. * Enhanced its seamless integration. The Company announced Movi for IBM Lotus Sametime Lotus Sametime is an enterprise instant messaging and web conferencing application sold by the Lotus Software division of IBM. Lotus Sametime provides enterprise instant messaging functionality, presence information, and web conferencing. , a PC video client tightly integrated with familiar desktop tools. WEBCAST/CONFERENCE CALL DETAILS Today at 11:00 am Eastern Time or 5:00 pm Central European Time Central European Time Noun the standard time adopted by Western European countries one hour ahead of Greenwich Mean Time, corresponding to British Summer Time Abbrev: (CET) , Fredrik Halvorsen, Chief Executive Officer, will host a live webcast/conference call from Oslo, Norway. Additionally, a PowerPoint presentation will accompany the webcast/conference call. To access the webcast, please visit: https://tandbergevents.webex.com For those who prefer to dial-in, the conference call can be accessed at +1.617.614.4921 (international) or at +1.800.394.6311 (U.S. callers). The audience passcode for the call is TANDBERG. An online archive of the broadcast will be available within one business day. [TABLE OMITTED] For further information please contact Senior Vice President of Operations Terje Rogne, ph. + 47 98 28 98 02. Audited fourth quarter results will be available February 15, 2007. First quarter results will be released on April 19, 2007. [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] FINANCIAL STATEMENTS - BASIS FOR PREPARATION The enclosed consolidated condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. financial statements have been prepared in accordance with IAS See iPlanet Application Server. 1. (computer) IAS - The first modern computer. It had main registers, processing circuits, information paths within the central processing unit, and used Von Neumann's fetch-execute cycle. 34, "Interim Financial Reporting". SIGNIFICANT ACCOUNTING POLICIES The accounting policies and methods of computation used in the preparation of the financial statements are consistent with the policies used in the annual financial statements for the year ended December 31, 2005. The enclosed consolidated condensed financial statements should be read in conjunction with the 2005 annual financial statements, which include a full description of the Group's accounting policies. ABOUT TANDBERG TANDBERG is a leading global provider of visual communication products and services. The Company has dual headquarters in New York and Oslo. TANDBERG designs, develops and markets systems and software for video, voice and data communication. The Company provides sales, support and value-added services in more than 90 countries worldwide. TANDBERG is publicly traded on the Oslo Stock Exchange Oslo Stock Exchange An exchange founded in 1819 and trading stocks, bonds, and stock options that is considered the options market of Norway. under the ticker TAA.OL. Please visit www.tandberg.net for more information. TANDBERG is a registered trademark or trademark in the U.S. and certain other countries. All other trademarks are property of their respective owners. |
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