New Focus Sees New Losses
When the optical components firm reported its second-quarter results Wednesday, it said revenues for the quarter ended July 21 were $26.6 million, up from $14.5 million a year ago. But the company acknowledged that it has several months of rough road ahead of it. New Focus executives warned that revenues for the third quarter would be between $16 million and $20 million, a quarter-to-quarter drop of between 25 and 40 percent.
New Focus's pro forma net loss for the quarter was $19.1 million or 26 cents a share. This included a $6.6 million charge against earnings in the form of inventory write-downs and order cancellation fees. Excluding the inventory charge, New Focus's pro forma loss was 17 cents a share, beating Wall Street's estimate by 2 cents.
The company's actual net loss for the quarter -- excluding write-downs it expects to take for goodwill -- was $56.1 million or 77 cents a share. New Focus is using the write-offs to rid its balance sheet of goodwill associated with two acquisitions it announced in October 2000.
Back then, it acquired JCA Technology for $25 million in cash plus $575 million in stock. It also bought Globe Y Technology for $50 million in stock. New Focus executives say they'll incorporate the goodwill write-off in the firm's next filing with the Securities and Exchange Commission.
The company says its pro forma net loss for the third quarter will likely be between $18 million and $21 million, or 24 to 29 cents a share. During the third quarter of fiscal 2000, New Focus's loss was only $1.3 million, or 2 cents a share.
To help curtail its mounting losses, New Focus says it will reduce spending by $6 million, or 18 percent, during the third quarter. It also expects to cut additional jobs and will reduce capital spending for the rest of the year to about $15 million, down from the $42 million it spent during the first half of the year.
New Focus says its headcount now stands at about 1,230, down 41 percent from the 2,100 employees it had earlier this year.
Shares of New Focus fell 0.13 (2.2%) to 5.60 in trading Wednesday.
- Phil Harvey, Senior Editor, Light Reading
http://www.lightreading.com Movers and shakers from more than 100 companies – including New Focus – will be speaking at Opticon 2001, Light Reading’s annual conference, being held in San Jose, California, August 13-16. Check it out at Opticon2001.