Zhone Announces Second Quarter Financial Results; Company Reports Significant Revenue Growth from Diverse Customer Base.Business Editors OAKLAND Oakland, city (1990 pop. 372,242), seat of Alameda co., W Calif., on the eastern side of San Francisco Bay; inc. 1852. Together with San Francisco and San Jose, the city comprises the fourth largest metropolitan area in the United States. , Calif.--(BUSINESS WIRE)--July 28, 2003 Zhone Technologies, Inc., the first company dedicated to developing the full spectrum of next-generation access infrastructure solutions, today announced that 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 for the quarter ended June June: see month. 30, 2003 were $20.5 million, an increase of 20% from net sales of $17.1 million for the quarter ended March 31, 2003. For the quarter ended June 30, 2003, net loss applicable to holders of common stock on a 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). ) basis, was $4.7 million, compared with $6.8 million for the quarter ended March 31, 2003. "We are pleased to report strong revenue growth this quarter," said Mory Mory is the name or part of the name of three communes of France:
Note: Please also refer to the Press Release "TELLIUM AND ZHONE ANNOUNCE DEFINITIVE MERGER AGREEMENT" also issued on July July: see month. 28, 2003. About Zhone Technologies, Inc. (Zhone) Zhone's strategy combines existing solutions with Zhone's internally developed intellectual property to create a portfolio of scalable next-generation network products supporting a rich array of voice, data, video, and entertainment services. The company was founded by the senior management team that grew telecommunications pioneer Ascend Communications, Inc., from its startup (STARTing UP) "At startup" means when the computer is first turned on or when a program is first loaded. See Startup folder. roots to the multi-billion-dollar company acquired by Lucent Technologies (NYSE NYSE See: New York Stock Exchange :LU) in June 1999. Zhone's advanced networking solutions include the Single Line Multi-Service architecture (SLMS SLMS Single Line Multi-Service (Zhone Technologies) SLMS School Library Media Specialist SLMS Society for Luminescence Microscopy and Spectroscopy SLMS Svenska Laser-Medicinska Sällskapet (TM)), FlexBand(TM) Multi-service port, Zhone Management System (ZMS ZMS Zero Mechanical State (TM)), Broadband Access See broadband and wireless broadband. Node (BAN(TM)), Multi-Access Line Concentrator (MALC MALC Multiple Access Line Concentrator (Zhone Technologies) MALC Marin Academic Library Consortium (Kentfield, CA) MALC Management of Acquisition Logistics Center (US DoD) (TM)), AccessNode(TM) and Universal Edge(TM) 9000 products (purchased from Nortel Networks (Nortel Networks Limited, Brampton, Ontario, www.nortelnetworks.com) A world leader in telecommunications products, which includes switching, wireless and broadband systems for service providers and carriers, telephones and systems for residential and business users, computer telephony - NYSE/TSE: NT), Sechtor(TM) universal voice gateway, the Z-Edge(TM) access products, RAPTOR(TM) DSLAM (DSL Access Multiplexor) A central office (CO) device for ADSL service that intermixes voice traffic and DSL traffic onto a customer's DSL line. It also separates incoming phone and data signals and directs them onto the appropriate carrier's network. See DSL. and Multi-Access Line Concentrator (MALC(TM)).
ZHONE TECHNOLOGIES, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands)
June 30, December 31,
-------- ------------
2003 2002
---- ----
Assets (unaudited)
Current assets:
Cash and cash equivalents $1,978 10,614
Accounts receivable, net of allowances
for sales return and doubtful accounts
of $7,576 and $7,969, respectively 12,953 14,997
Inventory 23,839 18,873
Prepaid expenses and other current
assets 1,468 1,546
--------- ----------
Total current assets 40,238 46,030
Property and equipment, net 22,773 23,512
Intangible assets, net 91,892 86,806
Restricted cash 6,513 6,313
Other assets 1,022 1,302
--------- ----------
Total assets $162,438 163,963
========= ==========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $13,998 12,279
Line of credit 9,032 4,614
Current portion of long-term debt 3,923 4,781
Accrued and other liabilities 25,771 32,313
--------- ----------
Total current liabilities 52,724 53,987
Long-term debt, less current portion 32,442 33,922
Other long-term liabilities 8,829 8,806
--------- ----------
Total liabilities 93,995 96,715
Redeemable convertible series AA and
B preferred stock -- 199,557
Stockholders' equity (deficit) 68,443 (132,309)
--------- ----------
Total liabilities and
stockholders' equity $162,438 163,963
========= ==========
ZHONE TECHNOLOGIES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
Three Months Ended Six Months Ended
------------------ ------------------
June 30, June 30, June 30, June 30,
2003 2002 2003 2002
---- ---- ---- ----
(unaudited) (unaudited)
Net revenue $20,534 30,506 37,609 60,687
Cost of revenue 11,147 18,883 20,896 37,407
-------- -------- -------- --------
Gross profit 9,387 11,623 16,713 23,280
-------- -------- -------- --------
Operating expenses:
Research and product
development 4,454 7,261 10,198 17,418
Sales and marketing 4,271 5,018 8,548 10,818
General and administrative 1,159 3,229 1,924 6,068
Restructuring charges -- 3,262 -- 4,532
Stock-based compensation 653 724 (3,318) 39
Amortization and impairment
of intangible assets 2,053 4,349 3,836 8,099
-------- -------- -------- --------
Total operating
expenses 12,590 23,843 21,188 46,974
-------- -------- -------- --------
Operating loss (3,203) (12,220) (4,475) (23,694)
Interest expense and other
income (expense), net (552) (1,664) (1,085) (4,099)
-------- -------- -------- --------
Loss before income
taxes (3,755) (13,884) (5,560) (27,793)
Income tax provision 56 36 97 79
-------- -------- -------- --------
Net loss (3,811) (13,920) (5,657) (27,872)
Accretion on preferred
stock (936) (944) (5,889) (1,812)
-------- -------- -------- --------
Net loss applicable
to holders of
common stock $(4,747) (14,864) (11,546) (29,684)
======== ======== ======== ========
Basic and diluted net loss
per share applicable to
holders of common stock $ (0.32) (1.61) (0.81) (3.22)
Weighted average shares
outstanding used to compute
basic and diluted net loss
per share applicable to
holders of common stock 14,710 9,253 14,259 9,218
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, including forward-looking statements regarding the Company's revenues. Actual results could differ materially from those projected in or contemplated by the forward-looking statements. Factors that could cause actual results to differ include general economic conditions, the pace of spending and timing of economic recovery in the telecommunications industry, the company's inability to sufficiently anticipate market needs and develop products and product enhancements that achieve market acceptance, and higher than anticipated expenses that the company may incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. in future quarters. In addition, please refer to the risk factors contained in Zhone's SEC filings, including, without limitation, Zhone's Registration Statement on Form 10 filed with the SEC on April 30, 2003, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. . Note to Editors: Zhone, the Zhone logo, and all Zhone product names are trademarks of Zhone Technologies, Inc. Other brand and product names are trademarks of their respective holders. |
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