8K – Arris Posts Prelim Q4 Net Sales of $1.75B to $1.8B
SUWANEE, Ga. -- Preliminary estimates of net sales and certain other measures of ARRIS International plc (“ARRIS”) for the quarter and year ended December 31, 2018, based on currently available information are set forth in the table below.
|Preliminary Estimates ($ in millions)||Quarter ended December 31, 2018 (unaudited)||Year ended December 31, 2018 (unaudited)|
|Net Sales||$1,775 to $1,800||$6,730 to $6,755|
|Adjusted Direct Contribution(1)||$194 to $209||$772 to $787|
|Adjusted EBITDA(2)||$192 to $207||$795 to $810|
(1) Adjusted Direct Contribution is defined as operating income, adjusted to eliminate the effect of amortization of intangible assets, impairment of goodwill and intangible assets, integration, acquisition, restructuring and other costs, stock-based compensation, and depreciation.
(2) Adjusted EBITDA is defined as earnings before income taxes, adjusted to eliminate the effect of interest, depreciation, amortization, integration, acquisition, restructuring and other costs, stock-based compensation, pension settlement charges, gain on disposal of product line, remeasurement of deferred taxes, and acquisition impacts related to deferred revenue and inventory.
These estimates are subject to completion of financial closing procedures for the quarter and year ended December 31, 2018. Moreover, these estimates have been prepared solely on the basis of currently available information. As a result, actual results could be materially different from these estimates due to the completion of financial closing procedures, final adjustments, completion of the review of the financial statements and other developments that arise between now and the time the financial statements are issued. Ernst & Young LLP, which serves as ARRIS’ independent registered public accounting firm, has not performed any procedures with respect to this financial information, nor have they expressed any opinion or other form of assurance with respect to the estimated ranges presented or their achievability.
As previously announced, on November 8, 2018, ARRIS entered into a Bid Conduct Agreement (the “Acquisition Agreement”) with CommScope Holding Company, Inc. (“CommScope”) providing for the acquisition of all of the ordinary shares of ARRIS by CommScope (the “Acquisition”). The Acquisition has not yet closed. ARRIS understands that CommScope historically has calculated Adjusted EBITDA differently than ARRIS. As used by CommScope, Adjusted EBITDA is defined as operating income, adjusted to eliminate amortization, depreciation, restructuring costs, asset impairments, equity-based compensation, integration and transaction costs and other items that they believe are useful to exclude in the evaluation of operating performance from period to period because these items are not representative of their core business. Using the CommScope definition, the preliminary estimate of Adjusted EBITDA for ARRIS would be $196 million to $211 million and $802 million to $817 million for the quarter and year ended December 31, 2018, respectively.
Arris Group Inc. (Nasdaq: ARRS)