LITTLE FALLS, New Jersey,
May 7, 2018 /PRNewswire/ --
Ceragon Networks Ltd. (NASDAQ: CRNT), the #1 wireless
backhaul specialist, today reported results for the first quarter
ended March 31, 2018.
First Quarter 2018 Highlights
Revenues - $83.3 million, up 9.5% from the first
quarter of 2017, and down 3.9% from the fourth quarter of 2017.
Gross margin – 33.1%, compared to 29.3% in the first
quarter of 2017 and 33.6% in the fourth quarter of 2017.
Operating income - $5.4 million, compared to
$2.0 million in the first quarter of
2017 and $7.5 million in the fourth
quarter of 2017.
Net income (loss) - net income of $2.1 million, or $0.03 per diluted share for the first quarter of
2018. Net loss for the first quarter of 2017 was $(0.1) million, or $(0.00) per diluted share. Net income for the
fourth quarter of 2017 was $7.2
million or $0.09 per diluted
share.
Non-GAAP results - gross margin was 33.2%, operating
income was $5.7 million, and net
income was $3.0 million, or
$0.04 per diluted share. For
reconciliation of GAAP to non-GAAP results, see the attached
tables.
Cash and cash equivalents - $26.0 million at March 31,
2018, compared to $25.9
million at December 31,
2017.
"We are beginning 2018 with a strong quarter in all respects,"
said Ira Palti, president and CEO of
Ceragon. "We had strong bookings in Q1, with particular strength
coming from India. Revenue
increased 9.5% year over year, and we now have enough visibility to
raise our quarterly run rate expectations to $80 to $85 million
during the balance of this year. We won several important new
projects in Q1 and our objective is to continue to gradually gain
market share. Our financial goal is to make 2018 the fourth
consecutive year of increasing net income, despite facing some
challenges with factors we can't control such as currency headwinds
and shortages of passive components."
Supplemental revenue breakouts by geography:
First quarter 2018:
-
Europe:
12%
- Africa:
2%
- North
America:
11%
- Latin
America:
13%
-
India:
46%
- APAC:
16%
A conference call to discuss the results will begin at
9:00 a.m. EDT. Investors are invited
to join the Company's teleconference by calling USA: (800) 398-9367 or International: +1 (612)
288-0337, from 8:50 a.m. EDT. The
call-in lines will be available on a first-come, first-serve
basis.
Investors can also listen to the call live via the Internet by
accessing Ceragon Networks' website at the investors'
page: https://www.ceragon.com/about-ceragon/investor-relations/events-webcasts/,
selecting the webcast link, and following the registration
instructions.
If you are unable to join us live, the replay numbers are:
USA: (800) 475-6701 or
International +1 (320) 365-3844 Access Code: 446862. A replay of
both the call and the webcast will be available through
June 7, 2018.
About Ceragon Networks Ltd.
Ceragon Networks Ltd. (NASDAQ: CRNT) is the world's #1
wireless backhaul specialist. We help operators and other service
providers worldwide increase operational efficiency and enhance end
customers' quality of experience with innovative wireless backhaul
solutions. Our customers include wireless service providers, public
safety organizations, government agencies and utility companies,
which use our solutions to deliver 4G, mission-critical multimedia
services and other applications at high reliability and speed.
Ceragon's unique multicore technology provides highly reliable,
high-capacity 4G wireless backhaul with minimal use of spectrum,
power and other resources. It enables increased productivity, as
well as simple and quick network modernization. We deliver a range
of professional services that ensure efficient network rollout and
optimization to achieve the highest value for our customers. Our
solutions are deployed by more than 460 service providers, as well
as hundreds of private network owners, in more than 130
countries.
Join the Discussion:
LinkedIn: https://www.linkedin.com/company/ceragon-networks
Facebook: https://www.facebook.com/CeragonNetworks
Twitter: https://twitter.com/Ceragon
YouTube: https://www.youtube.com/user/CeragonNetworks?feature=mhum
Blog: http://blog.ceragon.com/blog
Ceragon Networks® and FibeAir® are registered trademarks of
Ceragon Networks Ltd. in the United
States and other countries. CERAGON ® is a trademark of
Ceragon Networks Ltd., registered in various countries. Other names
mentioned are owned by their respective holders.
This press release contains statements concerning
Ceragon's future prospects that are "forward-looking statements" as
defined in the Private Securities Litigation Reform Act of
1995. Such forward-looking statements are based on the current
beliefs, expectations and assumptions of Ceragon's management.
Examples of forward-looking statements include: projections of
revenues, net income, gross margin, capital expenditures and
liquidity, competitive pressures, growth prospects, product
development, financial resources, cost savings and other financial
matters. You may identify these and other forward-looking
statements by the use of words such as "may", "plans",
"anticipates", "believes", "estimates", "targets", "expects",
"intends", "potential" or the negative of such terms, or other
comparable terminology. These forward-looking statements
are subject to risks and uncertainties that may cause actual
results to differ materially, including risks associated
with a decline in revenues due to our focus on a single market
segment; risks relating to the concentration of Ceragon's business
in certain geographic regions such as India, and in other developing nations;
political, economic and regulatory risks from doing business in
those developing regions, including potential currency restrictions
and fluctuations; risks related to our ability to meet the demand
for our products due shortages in raw materials including certain
passive components; risks associated with a change in Ceragon's
gross margin as a result of changes in the geographic mix of
revenues and/or as a results of increase in costs of raw material,
including certain passive components; risks associated with the
loss of a single customer or customer group, which represents a
significant portion of Ceragon's revenues; risks associated with
Ceragon's failure to effectively compete with other wireless
equipment providers; and other risks and uncertainties detailed
from time to time in Ceragon's Annual Report on Form 20-F and
Ceragon's other filings with the Securities and Exchange Commission
that represent our views only as of the date they are made and
should not be relied upon as representing our views as of any
subsequent date. We do not assume any obligation to update any
forward-looking statements.
-tables follow-
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
(U.S. dollars in
thousands, except share and per share data)
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
March
31,
|
|
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
83,275
|
|
$
76,021
|
|
|
Cost of
revenues
|
|
55,671
|
|
53,717
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
27,604
|
|
22,304
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
Research and
development, net
|
|
7,214
|
|
6,107
|
|
|
Selling and
marketing
|
|
10,562
|
|
9,735
|
|
|
General and
administrative
|
|
4,459
|
|
4,505
|
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
|
$
22,235
|
|
$
20,347
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
5,369
|
|
1,957
|
|
|
Financial expenses,
net
|
|
2,034
|
|
1,598
|
|
|
|
|
|
|
|
|
|
Income before
taxes
|
|
3,335
|
|
359
|
|
|
|
|
|
|
|
|
|
Taxes on
income
|
|
1,265
|
|
487
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$
2,070
|
|
$
(128)
|
|
|
|
|
|
|
|
|
|
Basic net
income (loss) per share
|
|
$
0.03
|
|
$
(0.00)
|
|
|
Diluted net
income (loss) per share
|
|
$
0.03
|
|
$
(0.00)
|
|
|
Weighted average number
of shares used in
computing basic net income (loss) per share
|
|
78,080,146
|
|
77,796,425
|
|
|
Weighted average number
of shares used in
computing diluted net income (loss) per share
|
|
80,065,171
|
|
77,796,425
|
|
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(U.S. dollars in
thousands)
|
|
|
|
|
|
|
March
31, 2018
|
|
December
31, 2017
|
ASSETS
|
|
Unaudited
|
|
Audited
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
25,956
|
|
$
25,877
|
Trade receivables,
net
|
|
116,002
|
|
113,719
|
Other accounts
receivable and prepaid expenses
|
|
14,081
|
|
17,052
|
Inventories
|
|
49,676
|
|
54,164
|
|
|
|
|
|
Total current
assets
|
|
205,715
|
|
210,812
|
|
|
|
|
|
NON-CURRENT
ASSETS:
|
|
|
|
|
Long-term bank
deposits
|
|
996
|
|
996
|
Deferred tax
assets
|
|
505
|
|
988
|
Severance pay and pension funds
|
|
5,445
|
|
5,459
|
Property
and equipment, net
|
|
29,367
|
|
29,870
|
Intangible assets, net
|
|
2,656
|
|
2,199
|
Other non-current
assets
|
|
3,506
|
|
3,269
|
|
|
|
|
|
Total non-current
assets
|
|
42,475
|
|
42,781
|
|
|
|
|
|
Total assets
|
|
$
248,190
|
|
$
253,593
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
|
|
|
|
Trade
payables
|
|
$
63,007
|
|
$
75,476
|
Deferred
revenues
|
|
6,130
|
|
5,193
|
Other accounts payable
and accrued expenses
|
|
28,548
|
|
24,781
|
|
|
|
|
|
Total current
liabilities
|
|
97,685
|
|
105,450
|
|
|
|
|
|
LONG-TERM
LIABILITIES:
|
|
|
|
|
Deferred tax
liability
|
|
132
|
|
141
|
Accrued severance pay
and pension
|
|
10,279
|
|
10,085
|
Other long term
payables
|
|
4,033
|
|
4,019
|
|
|
|
|
|
Total long-term
liabilities
|
|
14,444
|
|
14,245
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY:
|
|
|
|
|
Share
capital:
|
|
|
|
|
Ordinary shares
|
|
214
|
|
214
|
Additional paid-in
capital
|
|
411,270
|
|
410,817
|
Treasury shares at
cost
|
|
(20,091)
|
|
(20,091)
|
Other comprehensive
loss
|
|
(7,601)
|
|
(7,171)
|
Accumulated
deficits
|
|
(247,731)
|
|
(249,871)
|
|
|
|
|
|
Total shareholders' equity
|
|
136,061
|
|
133,898
|
|
|
|
|
|
Total liabilities
and shareholders' equity
|
|
$
248,190
|
|
$
253,593
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOW
|
(U.S. dollars, in
thousands)
|
(Unaudited)
|
|
|
|
Three months
ended
|
|
|
March
31,
|
|
|
2018
|
|
2017
|
Cash flow from
operating activities:
|
|
|
|
|
Net Income
(loss)
|
|
$
2,070
|
|
$
(128)
|
Adjustments to
reconcile net income (loss) to net cash
provided
by operating activities:
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
1,511
|
|
2,345
|
Stock-based
compensation expense
|
|
353
|
|
358
|
Decrease in trade and
other receivables, net
|
|
183
|
|
7,231
|
Decrease (increase)
in inventory, net of write-off
|
|
4,488
|
|
(4,984)
|
Decrease (increase)
in deferred tax asset, net
|
|
474
|
|
(15)
|
Increase (decrease)
in trade payables and accrued
liabilities
|
|
(5,854)
|
|
3,997
|
Increase (decrease)
in deferred revenues
|
|
940
|
|
(1,035)
|
Other
adjustments
|
|
208
|
|
12
|
Net cash provided
by operating activities
|
$
4,373
|
|
$
7,781
|
|
|
|
|
|
Cash flow from
investing activities:
|
|
|
|
|
Purchase of property
and equipment, net
|
|
(3,299)
|
|
(2,309)
|
Purchase of
intangible assets, net
|
|
(1,086)
|
|
-
|
Net cash used in
investing activities
|
|
$
(4,385)
|
|
$
(2,309)
|
|
|
|
|
|
Cash flow from
financing activities:
|
|
|
|
|
Repayment of loans
from financial institutions
|
-
|
|
(5,500)
|
Proceeds from
exercise of options
|
100
|
|
74
|
Net cash provided
by (used in) financing activities
|
|
$
100
|
|
$
(5,426)
|
|
|
|
|
|
Translation
adjustments on cash and cash equivalents
|
$
(9)
|
|
$
76
|
|
|
|
|
|
Increase in cash
and cash equivalents
|
$
79
|
|
$
122
|
|
|
|
|
|
Cash and cash
equivalents at the beginning of the period
|
25,877
|
|
36,338
|
|
|
|
|
|
Cash and cash
equivalents at the end of the period
|
$
25,956
|
|
$
36,460
|
RECONCILIATION OF
GAAP TO NON-GAAP FINANCIAL RESULTS
|
|
(U.S. dollars in
thousands, except share and per share data)
|
|
(Unaudited)
|
|
|
|
|
|
Three months
ended
March
31,
|
|
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
GAAP cost
of revenues
|
|
$
55,671
|
|
$
53,717
|
|
Amortization of
intangible assets
|
|
-
|
|
(303)
|
|
Stock based
compensation expenses
|
|
(17)
|
|
(20)
|
|
Changes in
pre-acquisition indirect tax positions
|
|
(15)
|
|
(162)
|
|
Non-GAAP cost
of revenues
|
|
$
55,639
|
|
$
53,232
|
|
|
|
|
|
|
|
GAAP gross
profit
|
|
$
27,604
|
|
$
22,304
|
|
Gross profit
adjustments
|
|
32
|
|
485
|
|
Non-GAAP gross
profit
|
|
$
27,636
|
|
$
22,789
|
|
|
|
|
|
|
|
GAAP Research and
development expenses
|
|
$
7,214
|
|
$
6,107
|
|
Stock based
compensation expenses
|
|
(60)
|
|
(78)
|
|
Non-GAAP Research and
development expenses
|
|
$
7,154
|
|
$
6,029
|
|
|
|
|
|
|
|
GAAP Sales and
Marketing expenses
|
|
$
10,562
|
|
$
9,735
|
|
Amortization of
intangible assets
|
|
-
|
|
(71)
|
|
Stock based
compensation expenses
|
|
(144)
|
|
(78)
|
|
Non-GAAP Sales and
Marketing expenses
|
|
$
10,418
|
|
$
9,586
|
|
|
|
|
|
|
|
GAAP General and
Administrative expenses
|
|
$
4,459
|
|
$
4,505
|
|
Stock based
compensation expenses
|
|
(132)
|
|
(182)
|
|
Non-GAAP General and
Administrative expenses
|
|
$
4,327
|
|
$
4,323
|
|
|
|
|
|
|
|
GAAP taxes on
income
|
|
$
1,265
|
|
$
487
|
|
Non-cash tax
adjustments
|
|
(564)
|
|
(98)
|
|
Non-GAAP taxes on
income
|
|
$
701
|
|
$
389
|
|
RECONCILIATION
OF GAAP TO NON-GAAP FINANCIAL RESULTS
|
|
(U.S. dollars in
thousands, except share and per share data)
|
|
(Unaudited)
|
|
|
|
|
|
Three months
ended
|
|
|
March
31,
|
|
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
|
|
GAAP net income
(loss)
|
|
$
2,070
|
|
$
(128)
|
|
|
Stock based
compensation expenses
|
|
353
|
|
358
|
|
|
Amortization of
intangible assets
|
|
-
|
|
374
|
|
|
Changes in
pre-acquisition indirect tax positions
|
|
15
|
|
162
|
|
|
Non-cash tax
adjustment
|
|
564
|
|
98
|
|
|
|
|
$
3,002
|
|
$
864
|
|
|
Non-GAAP net
income
|
|
|
|
|
|
|
|
|
GAAP basic net income
(loss) per share
|
|
$
0.03
|
|
$
(0.00)
|
|
|
|
|
|
|
|
|
|
$
0.03
|
|
$
(0.00)
|
|
|
|
|
|
|
|
|
GAAP diluted net
income (loss) per share
|
|
|
|
|
|
|
|
|
|
$
0.04
|
|
$
0.01
|
|
|
|
|
|
|
|
|
Non-GAAP basic and
diluted net income per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in computing
|
|
|
|
|
|
|
|
GAAP basic net income (loss) per share
|
|
78,080,146
|
|
77,796,425
|
|
|
|
|
|
|
|
|
|
|
80,065,171
|
|
77,796,425
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in
computing
|
|
|
|
|
|
|
|
GAAP diluted net income (loss) per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in computing
Non-GAAP basic and diluted net income per
share
|
|
80,377,797
|
|
80,751,956
|
|
|
|
|
|
|
|
|
Investors:
|
|
|
Doron
Arazi
|
or
|
Claudia
Gatlin
|
+972-3-5431-660
|
|
+1-212-830-9080
|
dorona@ceragon.com
|
|
claudiag@ceragon.com
|
|
|
|
|
|
|
Media:
|
|
|
Tanya
Solomon
|
|
|
+972-3-5431163
|
|
|
tanyas@ceragon.com
|
|
|
View original
content:http://www.prnewswire.com/news-releases/ceragon-networks-reports-first-quarter-2018-financial-results-300643446.html
SOURCE Ceragon Networks Ltd