RadiSys Reports Q4
In addition, the Company announced that it expects to deliver its industry leading Promentum-6000 ATCA system to a number of tier one customers during the first quarter of 2005. RadiSys' ATCA systems are designed to provide customers higher capacity, greater scalability, and higher density solutions that are more manageable than prior generation products. The Promentum-6000 will provide customers a highly reliable managed platform on which to build their new voice and data offerings and enables them to do this faster, and at a lower total cost than previous proprietary solutions. "Our Promentum-6000 system deliveries this quarter will mark a critical milestone in advancing the Company's strategy of providing integrated platform solutions to a broad set of communications equipment makers," said Scott Grout, President and CEO. RadiSys' ATCA solutions are primarily directed at the Service Provider market, and the Company's revenues in that market experienced 40% revenue growth in 2004.
Furthermore, in the first quarter the Company plans to announce a new series of modular computing solutions for its Commercial markets. These new modular products are in development now and will provide a family of high density, flexible solutions that will enable Commercial customers to achieve more rapid time to market with cost effective designs. The Company's revenues in the Commercial market realized growth of 19% year over year.
In 2004 the Company also made significant progress in its strategy to increase its global presence and operations. The Company successfully established and grew its Asia-based supply chain capability and increased its overall global outsourced supply from 30% to 65%. In addition, in the year the Company launched, staffed and began product development in its new Shanghai R&D center. This new design center, combined with the new Asia-based supply-chain, positions the Company well to grow its sales into this dynamic and growing region. For the year, Asia Pacific revenues increased 61% over 2003 and total international revenues grew from 51% to 61% of sales as the Company continued to execute its global expansion strategies.
As previously disclosed, the results for the fourth quarter also included a $1.4 million end of life component inventory sale at cost as well as a $1.4 million net restructuring charge. The restructuring charge consisted primarily of severance and related expenses for 61 employees, driven in part by the Company's shift in skills toward developing and marketing platform products and, in part, by the Company's continued progress in global manufacturing outsourcing.
"We continue to make excellent progress on expanding our strengths in developing and delivering new turn-key platforms like ATCA, and on expanding our global operations and presence," stated Scott Grout, CEO. "We closed out a strong 2004 from a financial, customer and strategic standpoint, and I'm very proud of what our team has accomplished."
The following statements are based on current expectations. These statements are forward-looking, and actual results may differ materially.
Commenting on the outlook, Scott Grout, CEO, said, "We have a strong and growing position with leading customers across our end markets. We believe that the markets we serve will continue to see growth in 2005 and that our position in these markets will continue to strengthen with our commitment to provide leading embedded solutions. We currently believe our combined addressable markets will experience mid to high single digit growth rates in 2005 and that we will grow faster than these markets for the year. We currently expect to see first quarter revenues in the range of $58 to $60 million and diluted earnings per share about equal to or slightly up from the fourth quarter."
In closing, Mr. Grout stated, "We are making excellent progress on our new platforms and modular products and are excited to be delivering our first Promentum-6000 ATCA systems to a number of our most coveted customers over the next few weeks as we execute our strategy of enabling our customers to bring better products to market, faster and at a lower total cost."