SAN JOSE, Calif., Oct. 21, 2013 /PRNewswire/ -- Symmetricom, Inc.
(NASDAQ:SYMM), a worldwide leader in precision time and frequency
technologies, today reported financial results for its first
quarter of fiscal year 2014 ended September
29, 2013.
(Logo:
http://photos.prnewswire.com/prnh/20110829/AQ59077LOGO)
In a separate announcement earlier today, Symmetricom and
Microsemi Corporation announced that they have entered into a
definitive agreement whereby Microsemi will acquire Symmetricom for
$7.18 per share, in a transaction
valued at approximately $230 million,
net of Symmetricom's projected cash balance at closing.
As a result of this pending transaction Symmetricom has accelerated
the release of its first quarter fiscal 2014 earnings, suspended
its prior practice of providing quarterly financial guidance and
cancelled its conference call to discuss first quarter fiscal 2014
results scheduled for Tuesday, October
22, at 1:30 p.m. Pacific
Time.
Net revenue for the first quarter of fiscal 2014 was
$48.0 million, compared to
$56.4 million reported for the first
quarter of fiscal 2013. Symmetricom reported a net loss of
$1.0 million, or $0.02 per share, for the first quarter of fiscal
2014, compared to net loss of $0.2
million, or $0.01 per share,
in the first quarter of fiscal 2013.
Non-GAAP net income for the first quarter of fiscal 2014 was
$0.9 million, or $0.02 per share, compared to $1.6 million, or $0.04 per share, reported for the first quarter
of fiscal 2013.
Cash, cash equivalents and short-term investments totaled
$79.8 million as of September 29, 2013 compared to $75.5 million reported as of June 30, 2013. Net cash provided by operating
activities in the first quarter was $4.3
million, and property, plant and equipment purchases were
approximately $1.6 million, resulting
in free cash flow of $2.7
million.
"We made significant progress executing our business plan in the
quarter, as we delivered results in-line with our expectations,"
said Liz Fetter, Chief Executive
Officer of Symmetricom.
Business Segment Revenue Results
Revenue in the Communications Business in the first quarter of
fiscal 2014 was $23.6 million,
compared to $31.4 million reported in
the first quarter of fiscal 2013. Revenue in the Government
and Enterprise Business in the first quarter of fiscal 2014 was
$24.5 million, compared to
$25.0 million reported in the first
quarter of fiscal 2013.
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 DOCSISĀ®
timing. Symmetricom is based in San
Jose, California, with offices worldwide. For more
information, visit: http://www.symmetricom.com or join the dialogue
at http://www.twitter.com/symmetricom.
Important Information and Where To Find It
The
transaction referred to above will be effected through a tender
offer which has not yet commenced. No statement in this
document is an offer to purchase or a solicitation of an offer to
sell any shares of the common stock of Symmetricom or any other
securities. At the time the Offer is commenced, Microsemi
Corporation ("Microsemi") and PETT Acquisition Corp., a wholly
owned subsidiary of Microsemi, will file a tender offer statement
on Schedule TO with the United States Securities and Exchange
Commission (the "SEC"), and Symmetricom will file a
Solicitation/Recommendation Statement on Schedule 14D-9 with the
SEC. Any offers to purchase or solicitations of offers to
sell may be made only pursuant to such tender offer
statement. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ
BOTH THE TENDER OFFER STATEMENT (INCLUDING AN OFFER TO PURCHASE, A
LETTER OF TRANSMITTAL AND RELATED DOCUMENTS) AND THE
SOLICITATION/RECOMMENDATION STATEMENT REGARDING THE OFFER WHEN THEY
BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION. These materials, when prepared and ready for
release, will be made available to Symmetricom's stockholders at no
expense to them. In addition, investors and security holders
may obtain a free copy of such materials (when available) and other
documents filed with the SEC at the website maintained by the SEC
at www.sec.gov or by directing such requests to the Information
Agent for the tender offer, which will be named in the tender offer
statement.
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,
acquisition-related costs, amortization of intangible assets,
restructuring charges, executive transition costs and off-shore
development 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 the expected closing of
the acquisition, and future performance and 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 associated with uncertainties as to the
timing of the tender offer and the subsequent merger; uncertainties
as to how many of Symmetricom's stockholders will tender their
shares of common stock in the tender offer; the possibility that
competing offers or acquisition proposals will be made; the
possibility that various conditions to the consummation of the
offer or the merger may not be satisfied or waived, including that
a governmental entity may prohibit, delay or refuse to grant
approval for the consummation of the offer or the merger; the
effects of disruption from the transactions on Symmetricom's
business and the fact that the announcement and pendency of the
transactions may make it more difficult to establish or maintain
relationships with employees, suppliers and other business
partners; the risk that stockholder litigation in connection with
the tender offer or the merger may result in significant costs of
defense, indemnification and liability; and other risks and
uncertainties pertaining to the business of Symmetricom, including,
the extent and magnitude of customer orders received and shipped
within the same quarter, risks relating to general economic
conditions in the markets we address and the telecommunications and
government markets in general, risks related to the development of
our new products and services, reliance on our contract
manufacturer, the effects of increasing competition and competitive
pricing pressure, uncertainties associated with changing
intellectual property laws or misappropriation of intellectual
property, 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, design flaws, defects in our
products or start-up manufacturing difficulties, 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 June 30, 2013
and subsequent Forms 10-Q and 8-K.
SYMM-F
Contact:
Justin Spencer
Chief Financial Officer
+1-408-428-7801
jspencer@symmetricom.com
|
|
|
|
|
|
|
|
SYMMETRICOM,
INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In thousands, except
per share amounts)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
|
September
29,
|
|
June 30,
|
|
September
30,
|
|
|
|
2013
|
|
2013
|
|
2012
|
|
|
|
|
|
|
|
|
Net
revenue
|
|
|
$ 48,044
|
|
$ 52,099
|
|
$ 56,391
|
Cost of
sales:
|
|
|
|
|
|
|
|
Cost of products and
services
|
|
|
27,382
|
|
27,538
|
|
31,900
|
Amortization of
purchased technology
|
|
|
194
|
|
475
|
|
234
|
Restructuring
charges
|
|
|
8
|
|
572
|
|
(45)
|
Total cost of
sales
|
|
|
27,584
|
|
28,585
|
|
32,089
|
Gross
profit
|
|
|
20,460
|
|
23,514
|
|
24,302
|
Gross
margin
|
|
|
42.6%
|
|
45.1%
|
|
43.1%
|
Operating
expenses:
|
|
|
|
|
|
|
|
Research and
development
|
|
|
6,795
|
|
7,975
|
|
8,313
|
Selling, general and
administrative
|
|
|
14,161
|
|
15,119
|
|
16,227
|
Amortization of
intangible assets
|
|
|
86
|
|
87
|
|
86
|
Restructuring
charges
|
|
|
962
|
|
2,650
|
|
55
|
Total operating
expenses
|
|
|
22,004
|
|
25,831
|
|
24,681
|
Operating income
(loss)
|
|
|
(1,544)
|
|
(2,317)
|
|
(379)
|
Interest income, net
of amortization (accretion) of premium (discount) on
investments
|
|
|
88
|
|
204
|
|
(36)
|
Income (loss) before
income taxes
|
|
|
(1,456)
|
|
(2,113)
|
|
(415)
|
Income tax provision
(benefit)
|
|
|
(456)
|
|
(567)
|
|
(212)
|
Net income
(loss)
|
|
|
$ (1,000)
|
|
$ (1,546)
|
|
$ (203)
|
|
|
|
|
|
|
|
|
Earnings (loss) per
share:
|
|
|
|
|
|
|
|
Basic
|
|
|
$ (0.02)
|
|
$ (0.04)
|
|
$ (0.01)
|
Diluted
|
|
|
$ (0.02)
|
|
$ (0.04)
|
|
$ (0.01)
|
|
|
|
|
|
|
|
|
Shares used in
computing earnings (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding - basic
|
|
|
40,863
|
|
40,661
|
|
40,510
|
Weighted average
shares outstanding - diluted
|
|
|
40,863
|
|
40,661
|
|
40,510
|
|
|
|
|
|
|
|
|
SYMMETRICOM,
INC.
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(In
thousands)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
29,
|
|
June 30,
|
|
|
|
|
|
2013
|
|
2013
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
|
$ 31,965
|
|
$ 29,358
|
|
Short-term
investments
|
|
|
|
47,881
|
|
46,131
|
|
Accounts receivable,
net
|
|
|
|
35,743
|
|
38,756
|
|
Inventories,
net
|
|
|
|
41,219
|
|
44,516
|
|
Prepaids and other
current assets
|
|
|
20,158
|
|
18,389
|
|
Total current
assets
|
|
|
|
176,966
|
|
177,150
|
Property, plant and
equipment, net
|
|
|
23,286
|
|
23,869
|
Intangible assets,
net
|
|
|
|
2,678
|
|
2,958
|
Deferred taxes and
other assets
|
|
|
|
27,340
|
|
26,951
|
|
Total
assets
|
|
|
|
$ 230,270
|
|
$ 230,928
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts
payable
|
|
|
|
$ 8,635
|
|
$ 7,813
|
|
Accrued
compensation
|
|
|
|
11,255
|
|
13,702
|
|
Accrued
warranty
|
|
|
|
1,626
|
|
1,550
|
|
Other accrued
liabilities
|
|
|
|
11,391
|
|
12,483
|
|
Total current
liabilities
|
|
|
|
32,907
|
|
35,548
|
Long-term
obligations
|
|
|
|
4,833
|
|
5,264
|
Deferred income
taxes
|
|
|
|
334
|
|
334
|
|
Total
liabilities
|
|
|
|
38,074
|
|
41,146
|
Stockholders'
equity:
|
|
|
|
|
|
|
|
Common
stock
|
|
|
|
201,521
|
|
198,227
|
|
Accumulated other
comprehensive loss
|
|
|
(156)
|
|
(276)
|
|
Accumulated
deficit
|
|
|
|
(9,169)
|
|
(8,169)
|
|
Total stockholders'
equity
|
|
|
|
192,196
|
|
189,782
|
|
Total liabilities and
stockholders' equity
|
|
$ 230,270
|
|
$ 230,928
|
|
|
|
|
|
|
SYMMETRICOM,
INC.
|
RECONCILIATION OF
GAAP TO NON-GAAP RESULTS
|
(In thousands, except
per share amounts)
|
(unaudited)
|
|
|
|
|
|
|
|
Three months
ended
|
|
September
29,
|
|
June 30,
|
|
September
30,
|
|
2013
|
|
2013
|
|
2012
|
Reconciliation from
GAAP to Non-GAAP
|
|
|
|
|
|
GAAP Net income
(loss)
|
$ (1,000)
|
|
$ (1,546)
|
|
$ (203)
|
|
|
|
|
|
|
Add Non-GAAP
adjustments:
|
|
|
|
|
|
Equity-based
compensation expense:
|
|
|
|
|
|
Cost of products and
services
|
239
|
|
222
|
|
291
|
Research and
development
|
176
|
|
219
|
|
361
|
Selling, general and
administrative
|
1,139
|
|
1,425
|
|
1,120
|
Total equity-based
compensation expense
|
1,554
|
|
1,866
|
|
1,772
|
|
|
|
|
|
|
Amortization of
intangible assets:
|
|
|
|
|
|
Cost of products and
services
|
194
|
|
475
|
|
234
|
Operating
expenses
|
86
|
|
87
|
|
86
|
Total amortization of
intangible assets
|
280
|
|
562
|
|
320
|
Restructuring
charges
|
970
|
|
3,222
|
|
10
|
Executive transition
costs
|
77
|
|
1,376
|
|
-
|
Off-shore development
transition costs
|
-
|
|
-
|
|
729
|
Income tax effect of
Pretax Non-GAAP adjustments
|
(980)
|
|
(2,452)
|
|
(1,070)
|
Non-GAAP Net
income
|
$ 901
|
|
$ 3,028
|
|
$ 1,558
|
|
|
|
|
|
|
Earnings (loss) per
share-diluted:
|
|
|
|
|
|
GAAP income
(loss)
|
$ (0.02)
|
|
$ (0.04)
|
|
$ (0.01)
|
Non-GAAP
income
|
$ 0.02
|
|
$ 0.07
|
|
$ 0.04
|
Weighted average
shares outstanding - diluted
|
41,217
|
|
41,015
|
|
41,675
|
|
|
|
|
|
|
|
|
|
SYMMETRICOM,
INC.
|
|
RECONCILIATION OF
GAAP TO NON-GAAP RESULTS
|
|
(In thousands, except
per share amounts)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
|
September
29,
|
|
June 30,
|
|
September
30,
|
|
|
|
2013
|
|
2013
|
|
2012
|
|
|
|
|
|
|
|
|
GAAP
Revenue
|
|
$
48,044
|
|
$
52,099
|
|
$
56,391
|
|
|
|
|
|
|
|
|
Reconciliation from
GAAP to Non-GAAP Gross Profit:
|
|
|
|
|
|
|
GAAP Gross
profit
|
(A)
|
$
20,460
|
|
$
23,514
|
|
$
24,302
|
|
GAAP Gross
margin
|
|
42.6%
|
|
45.1%
|
|
43.1%
|
|
|
|
|
|
|
|
|
Non-GAAP
adjustments:
|
|
|
|
|
|
|
|
Equity-based
compensation expense
|
|
239
|
|
222
|
|
291
|
|
Amortization of
purchased technology
|
|
194
|
|
475
|
|
234
|
|
Restructuring
charges
|
|
8
|
|
572
|
|
(45)
|
Non-GAAP Gross
profit
|
(B)
|
$
20,901
|
|
$
24,783
|
|
$
24,782
|
|
Non-GAAP Gross
margin
|
|
43.5%
|
|
47.6%
|
|
43.9%
|
|
|
|
|
|
|
|
|
Reconciliation from
GAAP to Non-GAAP Operating Expense:
|
|
|
|
|
|
GAAP Operating
expenses
|
(C)
|
$
22,004
|
|
$
25,831
|
|
$
24,681
|
|
Operating expense %
to revenue
|
|
45.8%
|
|
49.6%
|
|
43.8%
|
|
|
|
|
|
|
|
|
Non-GAAP
adjustments:
|
|
|
|
|
|
|
|
Equity-based
compensation expense
|
|
(1,315)
|
|
(1,644)
|
|
(1,481)
|
|
Amortization of
intangible assets
|
|
(86)
|
|
(87)
|
|
(86)
|
|
Restructuring
charges
|
|
(962)
|
|
(2,650)
|
|
(55)
|
|
Executive transition
costs
|
|
(77)
|
|
(1,376)
|
|
-
|
|
Off-shore development
transition costs
|
|
-
|
|
-
|
|
(729)
|
Non-GAAP operating
expenses
|
(D)
|
$
19,564
|
|
$
20,074
|
|
$
22,330
|
|
Non-GAAP operating
expenses % to revenue
|
|
40.7%
|
|
38.5%
|
|
39.6%
|
|
|
|
|
|
|
|
|
Reconciliation from
GAAP to Non-GAAP Operating Income:
|
|
|
|
|
|
GAAP Operating
income
|
(A) - (C)
|
$
(1,544)
|
|
$
(2,317)
|
|
$
(379)
|
|
Operating income % to
revenue
|
|
-3.2%
|
|
-4.4%
|
|
-0.7%
|
|
|
|
|
|
|
|
|
Non-GAAP Operating
income
|
(B) - (D)
|
$
1,337
|
|
$
4,709
|
|
$
2,452
|
|
Non-GAAP Operating
income % to revenue
|
|
2.8%
|
|
9.0%
|
|
4.3%
|
SOURCE Symmetricom, Inc.