Press Releases

Unedited news and product information from vendors.

Symmetricom Reports Second Quarter Fiscal Year 2012 Financial Results
Jan 25, 2012 (03:01 PM EST)


Solid Quarter-over-Quarter Revenue Momentum

- Net revenue of $58.3 million in fiscal Q2'12

- Non-GAAP net income of $4.2 million, or $0.10 per share

- GAAP net income of $2.4 million, or $0.06 per share

- Free Cash Flow of $5.5 million

San Jose, Calif., Jan. 25, 2012 /PRNewswire/ -- Symmetricom®, Inc. (NASDAQ:SYMM), a worldwide leader in precision time and frequency technologies, today reported financial results for its second quarter of fiscal year 2012 ended January 1, 2012.

(Logo:  http://photos.prnewswire.com/prnh/20110829/AQ59077LOGO)

Net revenue for the second quarter of fiscal 2012 was $58.3 million, up $1.9 million, or 3.4%, compared to the first quarter of fiscal 2012, driven by higher shipments of PackeTime™ products and continued solid performance overall in our Government and Enterprise business.  Symmetricom reported net income of $2.4 million, or $0.06 per share, for the second quarter of fiscal 2012, compared to net income of $2.7 million, or $0.06 per share, in the first quarter of fiscal 2012.

Non-GAAP net income for the second quarter of fiscal 2012 was $4.2 million, or $0.10 per share, compared to $4.1 million, or $0.10 per share, reported for the first quarter of fiscal 2012.

Cash, cash equivalents and short-term investments totaled $58.1 million as of January 1, 2012, an increase of $1.1 million from the $57.0 million reported as of October 2, 2011, reflecting strong cash inflows from operations, offset by approximately $4.0 million in stock repurchases during the second quarter of fiscal 2012.  Net cash generated from operating activities in the second quarter was $6.4 million, due in part to a decrease in inventories.  After subtracting approximately $0.9 million of property, plant and equipment purchases, free cash flow was approximately $5.5 million.

"Symmetricom delivered solid performance in the second quarter, with revenue at the high end of our expectations.  We see continued momentum in both our Communications and Government and Enterprise businesses, with strong customer demand for our solutions," said Dave Cote, president and chief executive officer of Symmetricom.  "As we execute on our growth initiatives, our revenue streams will become even more diversified by product, customer, and geography.  We remain focused on delivering profitable growth and creating long-term value for our shareholders."

Business Results

Revenue in the Communications Business in the second quarter of fiscal 2012 was $33.3 million, compared to $33.6 million reported in the first quarter of fiscal 2012, and $20.4 million reported in the second quarter of fiscal 2011.  Revenue in the Government and Enterprise Business in the second quarter of fiscal 2012 was $25.0 million, compared to $22.8 million reported in the first quarter of fiscal 2012, and $21.5 million reported in the second quarter of fiscal 2011.

Third Quarter 2012 Guidance

Symmetricom's guidance for the third quarter of fiscal 2012 is as follows:

  • Net revenue is expected to be in the range of $56 million to $62 million
  • GAAP earnings per share is expected to be in the range of $0.04 to $0.10
  • Non-GAAP earnings per share is expected to be in the range of $0.07 to $0.12

A reconciliation of GAAP and non-GAAP guidance is provided at the end of this press release.

Investor Conference Call

As previously announced, management will hold a conference call to discuss these results today, at 1:30 p.m. Pacific Time.  Investors are invited to join the conference call by dialing +1-312-470-7232 and referencing "Symmetricom."  A live webcast will also be available on the investor relations section of the company's website at http://www.symmetricom.com.  An audio replay will be available for one week and can be accessed by dialing +1-203-369-3219.

About Symmetricom, Inc.

Symmetricom (NASDAQ:SYMM), a world leader in precise time solutions, sets the world's standard for time. The company generates, distributes and applies precise time for the communications, aerospace/defense, IT infrastructure and metrology industries. Symmetricom's customers, from communications service providers and network equipment manufacturers to governments and their suppliers worldwide, are able to build more reliable networks and systems by using the company's advanced timing technologies, atomic clocks, services and solutions. All products support today's precise timing standards, including GPS-based timing, IEEE 1588 (PTP), Network Time Protocol (NTP), Synchronous Ethernet and DOCSIS® timing. Symmetricom is based in San Jose, Calif., with offices worldwide. For more information, visit: http://www.symmetricom.com or join the dialogue at http://www.twitter.com/symmetricom.

Non-GAAP Information

Certain non-GAAP financial information is included in this press release.  In the reconciliation of GAAP to non-GAAP results, Symmetricom excludes certain items related to non-cash equity-based compensation, amortization of intangible assets, restructuring charges, and manufacturing transition costs that the company does not consider indicative of its ongoing performance.  The income tax effect after these non-GAAP adjustments is determined based upon Symmetricom's estimate of its annual non-GAAP effective tax rate excluding these non-GAAP adjustments.  Symmetricom believes that excluding such items provides investors, analysts and management with a representation of the Company's core operating performance and with information useful in assessing, in conjunction with GAAP results, underlying trends in operating performance.  Management uses such non-GAAP information to evaluate financial results and to establish operational goals.  Non-GAAP information should not be considered superior to or as a substitute for data prepared in accordance with GAAP.  A reconciliation of the non-GAAP results to the GAAP results is provided in the financial schedules portion of this press release.

Free cash flow is defined as net cash provided by or used in operating activities minus purchases of property, plant and equipment.  Symmetricom believes this metric provides useful information to its investors, analysts, and management about the level of cash generated by or used in normal business operations, including the use of cash for the purchase of property, plant and equipment.  Management also views it as a measure of cash available to pay debt and return cash to stockholders.  Free cash flow is not a GAAP financial measure and should not be considered superior to or a substitute for operating cash flow or other cash flow data prepared in accordance with GAAP.

Safe Harbor

This press release contains forward-looking information within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and is subject to the safe harbor created by those sections.  These forward-looking statements include statements concerning third quarter fiscal 2012 guidance and future performance, expectations regarding diversification of our revenue streams, customer demand, our strategic initiatives and focus on profitable growth as well as the information regarding the usefulness of the non-GAAP financial information.  The statements in this press release are made as of the date of this press release, even if subsequently made available by Symmetricom on its website or otherwise.  Symmetricom expressly disclaims any obligation to update or revise any forward-looking statement contained herein, whether as a result of a change in its expectations, a change in any events, conditions or circumstances on which a forward-looking statement is based, or otherwise.  Symmetricom's actual results could differ materially from those projected or suggested in these forward-looking statements.  Factors that could cause future actual results to differ materially from the results projected in or suggested by such forward-looking statements include: but are not limited to, risks relating to general economic conditions in the markets we address and the telecommunications market in general, risks related to the development of our new products and services, reliance on our contract manufacturer for the manufacturing previously carried out at our Puerto Rico facility and by other third party vendors, the effects of increasing competition and competitive pricing pressure, uncertainties associated with changing intellectual property laws, developments in and expenses related to litigation, the inability to obtain sufficient amounts of key components, the rescheduling or cancellation of key customer orders, the loss of a key customer, the effects of new and emerging technologies, the risk that excess inventory may result in write-offs, price erosion and decreased demand, fluctuations in the rate of exchange of foreign currency, changes in our effective tax rate, market acceptance of our new products and services, technological advancements, undetected errors or defects in our products, the risks associated with our international sales, potential short-term investment losses and other risks due to credit market dislocation, geopolitical risks and risk of terrorist activities, the risks associated with attempting to integrate other companies and businesses we acquire, and the risk factors listed from time to time in Symmetricom's reports filed with the Securities and Exchange Commission, including the annual report on Form 10-K for the fiscal year ended July 3, 2011 and subsequent Form 8-K's.

SYMM-F


SYMMETRICOM, INC.


CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


(In thousands, except per share amounts)


(unaudited)


















Three months ended


Six months ended





January 1,


October 2,


December 26,


January 1,


December 26,





2012


2011


2010


2012


2010















Net revenue



$  58,294


$  56,378


$        41,844


$ 114,672


$        96,223


Cost of sales:













    Cost of products and services



32,225


29,830


23,222


62,055


49,828


    Amortization of intangible assets



185


186


267


371


554


    Restructuring charges



674


417


3,910


1,091


7,657


        Total cost of sales



33,084


30,433


27,399


63,517


58,039


        Gross profit



25,210


25,945


14,445


51,155


38,184


        Gross margin



43.2%


46.0%


34.5%


44.6%


39.7%


Operating expenses:













    Research and development



6,548


6,898


6,738


13,446


13,344


    Selling, general and administrative



14,864


14,810


13,596


29,674


26,395


    Amortization of intangible assets



52


52


61


104


123


    Restructuring charges



103


96


38


199


(843)


         Total operating expenses



21,567


21,856


20,433


43,423


39,019


         Operating income (loss)



3,643


4,089


(5,988)


7,732


(835)


Interest income, net of amortization (accretion) of premium (discount) on investments



(296)


66


331


(230)


223


Interest expense



-


-


-


-


(55)


     Income (loss) from continuing operations before taxes



3,347


4,155


(5,657)


7,502


(667)


Income tax provision (benefit)



902


1,406


(2,181)


2,308


(285)


     Income (loss) from continuing operations



2,445


2,749


(3,476)


5,194


(382)


Income (loss) from discontinued operations, net of tax



-


-


(49)


-


78


     Net income (loss)



$    2,445


$    2,749


$        (3,525)


$     5,194


$           (304)















Earnings (loss) per share - basic:













   Income (loss) from continuing operations



$      0.06


$      0.06


$          (0.08)


$       0.12


$          (0.01)


   Income (loss) from discontinued operations



-


-


-


-


-


Net income (loss)



$      0.06


$      0.06


$          (0.08)


$       0.12


$          (0.01)















Weighted average shares outstanding - basic



42,292


42,687


43,272


42,490


43,351















Earnings (loss) per share - diluted:













    Income (loss) from continuing operations



$      0.06


$      0.06


$          (0.08)


$       0.12


$          (0.01)


    Income (loss) from discontinued operations



-


-


-


-


-


Net income (loss)



$      0.06


$      0.06


$          (0.08)


$       0.12


$          (0.01)















Weighted average shares outstanding - diluted



42,762


43,294


43,272


42,989


43,351



SYMMETRICOM, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(unaudited)








January 1,


July 3,



2012


2011






ASSETS




Current assets:





Cash and cash equivalents

$   22,794


$   20,318


Short-term investments

35,352


43,340


Accounts receivable, net

36,539


40,511


Inventories

62,469


62,622


Prepaids and other current assets

17,861


14,004


    Total current assets

175,015


180,795

Property, plant and equipment, net

22,715


23,255

Intangible assets, net

1,954


2,429

Deferred taxes and other assets

27,418


29,361


         Total assets

$ 227,102


$ 235,840






LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities:





Accounts payable

$     8,568


$   16,113


Accrued compensation

12,932


13,743


Accrued warranty

1,835


1,601


Other accrued liabilities

11,120


14,683


    Total current liabilities

34,455


46,140

Long-term obligations

5,588


5,212

Deferred income taxes

334


334


    Total liabilities

40,377


51,686

Stockholders' equity:





Common stock

198,646


201,002


Accumulated other comprehensive income (loss)

(296)


(29)


Accumulated deficit

(11,625)


(16,819)


    Total stockholders' equity

186,725


184,154


         Total liabilities and stockholders' equity

$ 227,102


$ 235,840



SYMMETRICOM, INC.

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

(In thousands, except per share amounts)

(unaudited)












Three months ended


Six months ended


January 1,


October 2,


December 26,


January 1,


December 26,


2012


2011


2010


2012


2010

Reconciliation from GAAP to Non-GAAP










GAAP Net income (loss)

$    2,445


$    2,749


$        (3,525)


$    5,194


$           (304)











Non-GAAP adjustments:










Equity-based compensation expense:










    Cost of products and services

215


$       119


230


334


253

    Research and development

295


289


184


584


322

    Selling, general and administrative

1,170


755


704


1,925


995

Total equity-based compensation expense

1,680


1,163


1,118


2,843


1,570











Amortization of intangible assets:










    Cost of products and services

185


186


267


371


554

    Operating expenses

52


52


61


104


123

Total amortization of intangible assets

237


238


328


475


677











Restructuring charges

777


513


3,948


1,290


6,814

Manufacturing transition costs

-


-


2,041


-


2,041

Income tax effect of Non-GAAP adjustments

(934)


(536)


(2,551)


(1,470)


(3,728)

Non-GAAP Net income

$    4,205


$    4,127


$          1,359


$    8,332


$          7,070











Earnings (loss) per share - diluted:










    GAAP Net income (loss)

$      0.06


$      0.06


$          (0.08)


$      0.12


$          (0.01)

    Non-GAAP Net income

$      0.10


$      0.10


$            0.03


$      0.19


$            0.16











Weighted average shares outstanding - diluted

42,762


43,294


43,972


42,989


43,862




SYMMETRICOM, INC.


RECONCILIATION OF GAAP TO NON-GAAP RESULTS


(In thousands, except per share amounts)


(unaudited)




























Three months ended


Six months ended




January 1,


October 2,


December 26,


January 1,


December 26,




2012


2011


2010


2012


2010













GAAP Revenue


$  58,294


$  56,378


$        41,844


$ 114,672


$        96,223













Reconciliation from GAAP to Non-GAAP Gross Profit:











GAAP Gross profit

(A)

$  25,210


$  25,945


$        14,445


$   51,155


$        38,184


GAAP Gross margin


43.2%


46.0%


34.5%


44.6%


39.7%













Non-GAAP adjustments:












Equity-based compensation expense


215


119


230


334


253


Amortization of intangible assets


185


186


267


371


554


Restructuring charges


674


417


3,910


1,091


7,657


Manufacturing transition costs






2,041




2,041

Non-GAAP Gross profit

(B)

$  26,284


$  26,667


$        20,893


$   52,951


$        48,689


Non-GAAP Gross margin


45.1%


47.3%


49.9%


46.2%


50.6%













Reconciliation from GAAP to Non-GAAP Operating Expense:











GAAP Operating expenses

(C)

$  21,567


$  21,856


$        20,433


$   43,423


$        39,019


Operating expense % to revenue


37.0%


38.8%


48.8%


37.9%


40.6%













Non-GAAP adjustments:












Equity-based compensation expense


(1,465)


(1,044)


(888)


(2,509)


(1,317)


Amortization of intangible assets


(52)


(52)


(61)


(104)


(123)


Restructuring charges


(103)


(96)


(38)


(199)


843













Non-GAAP operating expenses

(D)

$  19,947


$  20,664


$        19,446


$   40,611


$        38,422


Non-GAAP operating expenses % to revenue


34.2%


36.7%


46.5%


35.4%


39.9%













Reconciliation from GAAP to Non-GAAP Operating Income (loss):











GAAP Operating income (loss)

(A) - (C)

$    3,643


$    4,089


$        (5,988)


$     7,732


$           (835)


Operating income % to revenue


6.2%


7.3%


-14.3%


6.7%


-0.9%













Non-GAAP Operating income

(B) - (D)

$    6,337


$    6,003


$          1,447


$   12,340


$        10,267


Operating income % to revenue


10.9%


10.6%


3.5%


10.8%


10.7%



SYMMETRICOM, INC.

RECONCILIATION OF FORWARD-LOOKING GUIDANCE FOR GAAP REVENUE AND EPS

TO NON-GAAP GUIDANCE FOR REVENUE AND EPS

(In thousands, except per share amounts)

(Unaudited)
























Three Months Ending April 1, 2012



Revenue


Earnings Per Share



From

To


From

To








GAAP Guidance

$ 56,000

$ 62,000


$ 0.04

$ 0.10








Estimated Non-GAAP Adjustments







Equity-based compensation expense




0.04

0.03


Income tax effect of non-GAAP adjustments




(0.01)

(0.01)


Total Non-GAAP Adjustments




0.03

0.02








Non-GAAP Guidance

$ 56,000

$ 62,000


$ 0.07

$ 0.12



Contact:
Dan Madden
VP Finance & Investor Relations
+1-408-428-7929
dmadden@symmetricom.com

SOURCE Symmetricom, Inc.