Light Reading
First-quarter revenues up 1.4% year-on-year at optical networking vendor.

ADVA Revenues Edge Up in Q1

Light Reading
News Wire Feed
Light Reading
4/24/2014
50%
50%

MARTINSRIED/MUNICH, Germany -- ADVA Optical Networking (FSE: ADV) announced Q1 2014 financial results for the quarter ended on March 31, 2014, and prepared in accordance with International Financial Reporting Standards (IFRS).

Q1 2014 IFRS FINANCIAL RESULTS
Revenues totaled EUR 78.1 million in Q1 2014 and were at the upper end of guidance of between EUR 74 million and EUR 79 million. This is up 1.4% vs. Q1 2013 at EUR 77.0 million and up 2.5% vs. EUR 76.2 million in Q4 2013. IFRS pro forma operating income, excluding stock-based compensation and amortization & impairment of goodwill & acquisition-related intangible assets, amounted to EUR 0.4 million or 0.5% of revenues, and was in line with guidance of between -2% and +2% of revenues. This compares to EUR 0.8 million or 1.0% of revenues in Q1 2013 and EUR 2.3 million or 3.0% of revenues in Q4 2013. These developments are largely due to lower gross margins adversely impacted by product and customer mix, higher amortization charges for capitalized development projects and reduced income from capitalization of development expenses.

IFRS operating income amounted to EUR 0.1 million in Q1 2014, after EUR 0.4 million in Q1 2013. The key driver for this unfavorable development is the above-mentioned decrease of pro forma operating income. The decline in part is offset by lower stock compensation expenses, which amounted to EUR 0.1 million in Q1 2014 after EUR 0.3 million in Q1 2013.

Q1 2014 IFRS net loss amounted to EUR 0.4 million, after a net income of EUR 0.8 million in Q1 2013. The reduction was largely driven by the development of the operating result described above, as well as higher interest expenses of EUR 0.4 million after EUR 0.2 million in Q1 2013.

Basic and diluted IFRS net earnings per share were EUR -0.01 each in Q1 2014 after EUR 0.02 each in Q1 2013.

"Q1 2014 revenue at EUR 78.1 million was at the upper end of guidance. This is an increase of 1.4% vs. Q1 2013 and an increase of 2.5% vs. Q4 2013. The increase in revenue mainly relates to stronger enterprise business in the Americas and EMEA regions. Our pro forma gross margin decreased from 39.3% in Q4 2013 to 35.4% in Q1 2014, due to variations in product and customer mix and higher quarter-on-quarter amortization of capitalized development projects. Prior to amortization of capitalized development projects, pro forma gross margin decreased from 45.9% in Q4 2013 to 42.7% in Q1 2014. Our pro forma operating margin came in at 0.5%, also in line with guidance, and demonstrates our focus on managing operational costs. Also, operating cash flow at EUR 4.8 million in Q1 2014 remained positive, and our high quarter-end cash & cash equivalents and net liquidity of EUR 77.1 million and EUR 38.5 million, respectively, demonstrate ongoing financial strength," commented Jaswir Singh, chief financial officer & chief operating officer of ADVA Optical Networking.

Q2 2014 OUTLOOK
In Q2 2014, ADVA Optical Networking expects revenues to range between EUR 84 million and EUR 89 million, and anticipates pro forma operating income of between -2% and +2% of revenues. As a matter of caution, ADVA Optical Networking notes that it will continue to perform quarterly reviews of the expected business development with respect to all intangible assets, including capitalized development expenses. In case of highly adverse business prospects, these reviews may result in non-cash impairment charges in Q2 2014 and beyond. The pro forma operating income guidance provided above excludes any such potential impairment charges. ADVA Optical Networking will hold its annual shareholders' meeting on June 5, 2014, in Meiningen, Germany, and will publish its Q2 2014 financial results on July 24, 2014.

"Although, we are seeing signs of the telecommunications industry slowly returning to growth in Europe, the broader sentiment remains cautious as the shift to software-centric networks and architectural changes is deferring service provider investment decisions in the short-term. In order to support the exponential increase of high-capacity data and video applications, the drive toward Long Term Evolution-Advanced (LTE-A) networks and small cells is creating pressure on both mobile network operators and backhaul service providers, and thus both are continuing to evolve their networks to packet-based solutions. Precise timing and synchronization is critical for this development. The acquisition of Oscilloquartz is a strategic milestone for us and provides ADVA Optical Networking with a complete end-to-end solution for the delivery and, most importantly, assurance of highly accurate timing - a first within the industry; thereby allowing our rapid expansion into the synchronization business for next-generation networks. The next few years will clearly highlight the strategic vision of this acquisition, heightening our revenue growth potential, margin opportunity, and increasing shareholder value," stated Brian Protiva, chief executive officer of ADVA Optical Networking.

ADVA Optical Networking (Frankfurt: ADV)

(0)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Educational Resources
sponsor supplied content
Educational Resources Archive
Flash Poll
From The Founder
Is your network built on 'The Old IP,' or are you part of 'The New IP' revolution?
LRTV Documentaries
A Cultural Shift for an OTT World

9|26|14   |   01:41   |   (3) comments


Telcos need to embrace a new approach to partnerships if they are to generate extra revenues quickly and give customers what they want.
LRTV Documentaries
New Skills Needed as Telecom, IT Collide

9|26|14   |   4:07   |   (1) comment


As telecom and IT collide, new technologies are emerging, new skills are needed and new opportunities for women are arising.
UBB Forum News
Do IP Networks Need An Overhaul?

9|25|14   |   02:01   |   (0) comments


As traffic levels ramp, do IP networks need new technologies and topologies?
LRTV Documentaries
Sprint Wields Its Influence in the Valley

9|25|14   |   3:09   |   (11) comments


Anne-Louise Kardas, Sprint's connection to startups in the Valley, explains how telcos can be innovative and find new opportunities with partners.
LRTV Documentaries
SDN, NFV & The Future of XO's Network

9|25|14   |   3:47   |   (0) comments


XO Communications COO Don MacNeil explains how cloud, SDN and NFV are altering its network requirements as well as changing data centers of the future.
UBB Forum News
The OTT Conundrum

9|24|14   |   01:39   |   (0) comments


What is holding back prosperous partnerships between telcos and the OTT players?
LRTV Documentaries
Putting Broadband to Work

9|24|14   |   01:26   |   (0) comments


High-speed broadband network rollout is key to telco strategies, but it's what happens after the network is built that counts.
Light Reedy
Light Reading's Women in Telecom Recap

9|24|14   |   0:55   |   (4) comments


Our first Women in Telecom breakfast was a huge success, and we hope you'll join us in London for the next event on November 6.
UBB Forum News
Monetizing Ultra-Broadband

9|24|14   |   01:43   |   (2) comments


Ultra-broadband networks need to be built, with fiber-to-the-premises the ultimate goal, but they need to be monetized, too.
LRTV Huawei Video Resource Center
Sales Director of INIT on Plug & Play Switch Devices

9|19|14   |   3:21   |   (0) comments


INIT Italy uses both the Huawei S5700 and S7700 series switches for the campus LAN environment. Sales Director Andrea Curti says their company chose these Huawei devices over others because of their performance, flexible scalability and plug-and-play features.
LRTV Huawei Video Resource Center
Saudi Arabia Upgrades Vocational Training System

9|19|14   |   3:31   |   (0) comments


The Technical and Vocational Training Corporation (TVTC) has 100,000 students, 150 government-owned institutions and oversees 1000 private institutes. The CIO of TVTC explains that Huawei devices have allowed them to manage multiple datacenters using just one software program, scientifically tracking the progress of students and teachers, saving them millions.
LRTV Huawei Video Resource Center
Huawei's Media Solutions Are Here to Stay

9|19|14   |   4:35   |   (0) comments


The current media revolution requires rapid upgrades in technology. New formats (HD, 3D, 4K etc.) and the subsequent explosion of file sizes demand sophisticated network and storage architecture. Social media and the multiple distribution channels require a robust asset management system. Gartner analyst Venecia Liu speaks about the current technological trends in ...
Upcoming Live Events
October 29, 2014, New York City
November 6, 2014, Santa Clara
November 11, 2014, Atlanta, GA
December 2, 2014, New York City
December 3, 2014, New York City
December 9-10, 2014, Reykjavik, Iceland
June 9-10, 2015, Chicago, IL
Infographics
Half of the world's population will be connected to the Internet by 2017, but not just by smartphones and desktops.
Hot Topics
Facebook Pokes Around LTE Direct
Sarah Reedy, Senior Editor, 9/25/2014
Sprint Wields Its Influence in the Valley
Sarah Reedy, Senior Editor, 9/25/2014
Is Redbox Instant Shutting Down?
Mari Silbey, Independent Technology Editor, 9/30/2014
US Ignite Cultivates Gigabit Apps
Jason Meyers, Senior Editor, Utility Communications/IoT, 9/25/2014
Like Us on Facebook
Twitter Feed