Westell Technologies, Inc. (NASDAQ:WSTL), a leading provider of
high-performance wireless infrastructure solutions, announced
results for its fiscal 2018 first quarter ended June 30, 2017
(1Q18). Management will host a conference call to discuss
financial and business results tomorrow, Thursday, August 10,
2017, at 9:30 AM Eastern Time (details below).
Consolidated revenue in 1Q18 was $16.6 million,
and comprised $7.0 million from the In-Building Wireless (IBW)
segment, $4.1 million from the Intelligent Site Management and
Services (ISMS) segment, and $5.5 million from the Communication
Network Solutions (CNS) segment.
Westell’s new President and Chief Executive
Officer Matt Brady stated, “In 1Q18, business grew for the second
consecutive quarter on the strength of our IBW and CNS
segments. IBW achieved its highest revenue level since the
December 2015 quarter, as our Universal DAS Interface Tray (UDIT)
maintained its robust sales pace and our Public Safety revenue
increased. CNS was up significantly as Integrated Cabinets
and our Power Distribution products each recorded their best
quarterly revenue since March 2016.”
|
1Q183 months ended 6/30/17 |
4Q173 months ended 3/31/17 |
+ favorable /- unfavorable |
Revenue |
$16.6M |
$15.4M |
+$1.2M |
Gross Margin |
40.8% |
44.0% |
-3.2% |
Operating Expenses |
$7.4M |
$7.4M |
$— |
Net Income (Loss) |
($0.6M) |
($0.6M) |
$— |
Earnings (Loss) Per Share |
($0.04) |
($0.04) |
$— |
Non-GAAP Operating Expenses (1) |
$6.0M |
$5.9M |
-$0.1M |
Non-GAAP Net Income (1) |
$0.8M |
$1.0M |
-$0.2M |
Non-GAAP Earnings Per Share (1) |
$0.05 |
$0.06 |
-$0.01 |
Non-GAAP Adjusted EBITDA (1) |
$1.0M |
$1.2M |
-$0.2M |
(1) Please refer to the schedule at the end of
this press release for a complete GAAP to non-GAAP reconciliation
and other information related to non-GAAP financial measures. |
“We continued to meet or beat key operating
targets, including gross margin at 40% or greater and non-GAAP
operating expenses at $6.0 million. While the business has
made great progress in recent quarters, our number one goal is
profitable revenue growth, including executing on our initiatives
in the Public Safety market for IBW and on the emerging Centralized
Radio Access Network (CRAN) opportunities for ISMS and CNS,” added
Brady. Cash was $23.7 million at June 30, 2017, compared to
$21.8 million at March 31, 2017. The $1.9 million net
increase comprised $2.4 million of cash generated from operations,
driven by the profitable non-GAAP results and improved working
capital. This was partly offset by $0.5 million of cash used
for share repurchases and capital expenditures.
In-Building Wireless (IBW)
Segment
IBW’s sequential revenue increase was primarily
driven by higher sales of Public Safely solutions. IBW’s
segment gross margin increase was driven primarily by a more
favorable mix and lower overhead costs.
|
1Q18 3 months ended 6/30/17 |
4Q17 3 months ended 3/31/17 |
+ favorable / - unfavorable |
IBW Segment Revenue |
$7.0M |
$6.9M |
+$0.1M |
IBW Segment Gross Margin |
43.3% |
42.2% |
+1.1% |
IBW Segment R&D Expense |
$1.5M |
$1.5M |
$— |
IBW Segment Profit |
$1.6M |
$1.5M |
+$0.1M |
Intelligent Site Management &
Services (ISMS) Segment
ISMS’s sequential revenue decrease was primarily
due to lower sales of Remote units. ISMS’s segment gross
margin decrease was primarily due to higher segment cost of goods
sold.
|
1Q18 3 months ended 6/30/17 |
4Q17 3 months ended 3/31/17 |
+ favorable / - unfavorable |
ISMS Segment Revenue |
$4.1M |
$4.5M |
-$0.4M |
ISMS Segment Gross Margin |
51.5% |
56.2% |
-4.7% |
ISMS Segment R&D Expense |
$0.6M |
$0.6M |
$— |
ISMS Segment Profit |
$1.6M |
$1.9M |
-$0.3M |
Communication Network Solutions (CNS)
Segment
CNS’s sequential revenue increase was primarily
driven by higher sales of Integrated Cabinets and Power
Distribution products. CNS’s gross margin decrease was
primarily due to increased excess inventory costs.
|
1Q18 3 months ended 6/30/17 |
4Q17 3 months ended 3/31/17 |
+ favorable / - unfavorable |
CNS Segment Revenue |
$5.5M |
$3.9M |
+$1.6M |
CNS Segment Gross Margin |
29.6% |
32.7% |
-3.1% |
CNS Segment R&D Expense |
$0.2M |
$0.3M |
+$0.1M |
CNS Segment Profit |
$1.4M |
$1.0M |
+$0.4M |
Conference Call
InformationManagement will discuss financial and business
results during the quarterly conference call on Thursday,
August 10, 2017, at 9:30 AM Eastern Time. Investors may
quickly register online in advance of the call at
https://www.conferenceplus.com/Westell. After registering,
participants receive dial-in numbers, a passcode and a registration
ID that is used to uniquely identify their presence and
automatically join them into the audio conference. A
participant may also register by telephone on August 10, 2017,
by calling 888-206-4065 no later than 8:15 AM
Central Time (9:15 AM Eastern Time) and providing the operator
confirmation number 45285112.
This news release and related information that
may be discussed on the conference call will be posted on the
Investor Relations section of Westell's website:
http://ir.westell.com. A digital recording of the entire conference
will be available for replay on Westell's website by approximately
1:00 PM Eastern Time following the conclusion of the
conference.
About Westell
TechnologiesWestell is a leading provider of
high-performance wireless infrastructure solutions focused on
innovation and differentiation at the edge of communication
networks where end users connect. The Company's portfolio of
products and solutions enable service providers and network
operators to improve performance and reduce operating
expenses. With millions of products successfully deployed
worldwide, Westell is a trusted partner for transforming networks
into high-quality reliable systems. For more information, please
visit www.westell.com.
“Safe Harbor” Statement under the Private
Securities Litigation Reform Act of 1995
Certain statements contained herein that are not
historical facts or that contain the words “believe,” “expect,”
“intend,” “anticipate,” “estimate,” “may,” “will,” “plan,”
“should,” or derivatives thereof and other words of similar meaning
are forward-looking statements that involve risks and
uncertainties. Actual results may differ materially from
those expressed in or implied by such forward-looking
statements. Factors that could cause actual results to differ
materially include, but are not limited to, product demand and
market acceptance risks, customer spending patterns, need for
financing and capital, economic weakness in the United States
(“U.S.”) economy and telecommunications market, the effect of
international economic conditions and trade, legal, social and
economic risks (such as import, licensing and trade restrictions),
the impact of competitive products or technologies, competitive
pricing pressures, customer product selection decisions, product
cost increases, component supply shortages, new product
development, excess and obsolete inventory, commercialization and
technological delays or difficulties (including delays or
difficulties in developing, producing, testing and selling new
products and technologies), the ability to successfully consolidate
and rationalize operations, the ability to successfully identify,
acquire and integrate acquisitions, the effect of the Company's
accounting policies, retention of key personnel and other risks
more fully described in the Company's SEC filings, including the
Form 10-K for the fiscal year ended March 31, 2017, under
Item 1A - Risk Factors. The Company undertakes no
obligation to publicly update these forward-looking statements to
reflect current events or circumstances after the date hereof, or
to reflect the occurrence of unanticipated events, or
otherwise.
Westell Technologies,
Inc.Condensed Consolidated Statement of
Operations(Amounts in thousands, except per share
amounts)(Unaudited) |
|
|
|
Three months ended |
|
|
|
June 30, |
|
March 31, |
|
June 30, |
|
|
|
2017 |
|
2017 |
|
2016 |
|
Revenue: |
|
|
|
|
|
|
|
Products |
|
$ |
15,545 |
|
|
$ |
14,290 |
|
|
$ |
13,613 |
|
|
Services |
|
1,029 |
|
|
1,096 |
|
|
1,203 |
|
|
Total revenue |
|
16,574 |
|
|
15,386 |
|
|
14,816 |
|
|
Cost of
revenue: |
|
|
|
|
|
|
|
Products |
|
9,424 |
|
|
8,331 |
|
|
9,601 |
|
|
Services |
|
383 |
|
|
292 |
|
|
650 |
|
|
Total cost of
revenue |
|
9,807 |
|
|
8,623 |
|
|
10,251 |
|
|
Gross profit |
|
6,767 |
|
|
6,763 |
|
|
4,565 |
|
|
Gross margin |
|
40.8 |
% |
|
44.0 |
% |
|
30.8 |
% |
|
Operating
expenses: |
|
|
|
|
|
|
|
R&D |
|
2,276 |
|
|
2,349 |
|
|
4,277 |
|
|
Sales and
marketing |
|
2,336 |
|
|
2,124 |
|
|
3,381 |
|
|
General
and administrative |
|
1,711 |
|
|
1,651 |
|
|
2,345 |
|
|
Intangible amortization |
|
1,047 |
|
|
1,151 |
|
|
1,200 |
|
|
Restructuring |
|
— |
|
|
100 |
|
(1 |
) |
(36 |
) |
|
Long-lived assets impairment |
|
— |
|
|
— |
|
|
1,181 |
|
(2 |
) |
Total
operating expenses |
|
7,370 |
|
|
7,375 |
|
|
12,348 |
|
|
Operating profit
(loss) |
|
(603 |
) |
|
(612 |
) |
|
(7,783 |
) |
|
Other income (expense),
net |
|
43 |
|
|
94 |
|
|
17 |
|
|
Income (loss) before
income taxes |
|
(560 |
) |
|
(518 |
) |
|
(7,766 |
) |
|
Income tax benefit
(expense) |
|
(12 |
) |
|
(38 |
) |
|
(2 |
) |
|
Net income (loss) |
|
$ |
(572 |
) |
|
$ |
(556 |
) |
|
$ |
(7,768 |
) |
|
|
|
|
|
|
|
|
|
Net income (loss) per
share: |
|
|
|
|
|
|
|
Basic net
income (loss) |
|
$ |
(0.04 |
) |
|
$ |
(0.04 |
) |
(3 |
) |
$ |
(0.51 |
) |
(3 |
) |
Diluted
net income (loss) |
|
$ |
(0.04 |
) |
|
$ |
(0.04 |
) |
(3 |
) |
$ |
(0.51 |
) |
(3 |
) |
Weighted-average number
of common shares outstanding: |
|
|
|
|
|
|
|
Basic |
|
15,481 |
|
|
15,431 |
|
(3 |
) |
15,254 |
|
(3 |
) |
Diluted |
|
15,481 |
|
|
15,431 |
|
(3 |
) |
15,254 |
|
(3 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The Company recorded restructuring expense primarily
relating to abandonment of excess office space in New
Hampshire. |
(2) Non-cash impairment related to long-lived assets
associated with the previously announced strategic decision related
to the discontinuation of ClearLink DAS. |
(3) All common stock, equity, share and per share amounts have
been retroactively adjusted to reflect a one-for-four reverse stock
split which was effective June 7, 2017. |
Westell Technologies,
Inc.Condensed Consolidated Balance
Sheet(Amounts in thousands) |
|
|
|
|
|
|
|
June 30, 2017 (Unaudited) |
|
March 31, 2017 |
Assets |
|
|
|
|
Cash and cash
equivalents |
|
$ |
23,688 |
|
|
$ |
21,778 |
|
Accounts receivable,
net |
|
10,337 |
|
|
12,075 |
|
Inventories |
|
12,190 |
|
|
12,511 |
|
Prepaid expenses and
other current assets |
|
1,181 |
|
|
1,409 |
|
Total
current assets |
|
47,396 |
|
|
47,773 |
|
Land, property and
equipment, net |
|
1,910 |
|
|
1,984 |
|
Intangible assets,
net |
|
14,576 |
|
|
15,624 |
|
Other non-current
assets |
|
153 |
|
|
160 |
|
Total
assets |
|
$ |
64,035 |
|
|
$ |
65,541 |
|
Liabilities and
Stockholders’ Equity |
|
|
|
|
Accounts payable |
|
$ |
5,027 |
|
|
$ |
4,163 |
|
Accrued expenses |
|
3,678 |
|
|
4,273 |
|
Accrued
restructuring |
|
738 |
|
|
1,171 |
|
Deferred revenue |
|
1,776 |
|
|
2,359 |
|
Total
current liabilities |
|
11,219 |
|
|
11,966 |
|
Deferred revenue
non-current |
|
1,008 |
|
|
1,102 |
|
Deferred income tax
liability |
|
7 |
|
|
— |
|
Accrued restructuring
non-current |
|
15 |
|
|
63 |
|
Other non-current
liabilities |
|
228 |
|
|
236 |
|
Total
liabilities |
|
12,477 |
|
|
13,367 |
|
Total
stockholders’ equity |
|
51,558 |
|
|
52,174 |
|
Total
liabilities and stockholders’ equity |
|
$ |
64,035 |
|
|
$ |
65,541 |
|
Westell Technologies,
Inc.Condensed Consolidated Statement of Cash
Flows(Amounts in thousands)(Unaudited) |
|
|
|
|
|
|
Three
months ended June
30, |
|
|
|
2017 |
|
2016 |
|
Cash flows from operating activities: |
|
|
|
Net income (loss) |
|
$ |
(572 |
) |
|
$ |
(7,768 |
) |
|
Reconciliation of net loss to net cash used in operating
activities: |
|
|
|
|
|
Depreciation and amortization |
|
1,277 |
|
|
1,585 |
|
|
Long-lived assets impairment |
|
— |
|
|
1,181 |
|
(1 |
) |
Stock-based compensation |
|
330 |
|
|
406 |
|
|
Restructuring |
|
— |
|
|
(36 |
) |
|
Deferred
taxes |
|
7 |
|
|
2 |
|
|
Other
loss (gain) |
|
(4 |
) |
|
6 |
|
|
Changes
in assets and liabilities: |
|
|
|
|
|
Accounts
receivable |
|
1,748 |
|
|
5,470 |
|
|
Inventory |
|
321 |
|
|
(234 |
) |
|
Accounts
payable and accrued expenses |
|
(220 |
) |
|
(4,144 |
) |
|
Deferred
revenue |
|
(677 |
) |
|
(448 |
) |
|
Other |
|
235 |
|
|
128 |
|
|
Net cash
provided by (used in) operating activities |
|
2,445 |
|
|
(3,852 |
) |
|
Cash flows from
investing activities: |
|
|
|
|
|
Net
maturity (purchase) of short-term investments and debt
securities |
|
— |
|
|
465 |
|
|
Purchases
of property and equipment, net |
|
(155 |
) |
|
(396 |
) |
|
Net cash
provided by (used in) investing activities |
|
(155 |
) |
|
69 |
|
|
Cash flows from
financing activities: |
|
|
|
|
|
Purchase
of treasury stock |
|
(374 |
) |
|
(84 |
) |
|
Payment
of contingent consideration |
|
— |
|
|
(127 |
) |
|
Net cash
provided by (used in) financing activities |
|
(374 |
) |
|
(211 |
) |
|
(Gain) loss of
exchange rate changes on cash |
|
(6 |
) |
|
3 |
|
|
Net increase
(decrease) in cash and cash equivalents |
|
1,910 |
|
|
(3,991 |
) |
|
Cash and cash
equivalents, beginning of period |
|
21,778 |
|
|
19,169 |
|
|
Cash and cash
equivalents, end of period |
|
$ |
23,688 |
|
|
$ |
15,178 |
|
(2 |
) |
|
|
|
|
|
|
|
|
|
|
|
(1)
Non-cash impairment related to long-lived assets associated with
the previously announced strategic decision related to the
discontinuation of ClearLink DAS. |
(2) As of
June 30, 2016, the Company has $10.1 million of short-term
investments in addition to cash and cash equivalents. |
Westell Technologies,
Inc.Segment Statement of
Operations(Amounts in thousands)(Unaudited) |
|
Sequential Quarter Comparison |
|
|
|
Three months ended June 30, 2017 |
|
Three months ended March 31, 2017 |
|
|
IBW |
|
ISMS |
|
CNS |
|
Total |
|
IBW |
|
ISMS |
|
CNS |
|
Total |
Total revenue |
|
$ |
6,956 |
|
|
$ |
4,130 |
|
|
$ |
5,488 |
|
|
$ |
16,574 |
|
|
$ |
6,944 |
|
|
$ |
4,548 |
|
|
$ |
3,894 |
|
|
$ |
15,386 |
|
Gross profit |
|
3,014 |
|
|
2,126 |
|
|
1,627 |
|
|
6,767 |
|
|
2,933 |
|
|
2,557 |
|
|
1,273 |
|
|
6,763 |
|
Gross margin |
|
43.3 |
% |
|
51.5 |
% |
|
29.6 |
% |
|
40.8 |
% |
|
42.2 |
% |
|
56.2 |
% |
|
32.7 |
% |
|
44.0 |
% |
R&D
expenses |
|
1,463 |
|
|
565 |
|
|
248 |
|
|
2,276 |
|
|
1,473 |
|
|
619 |
|
|
257 |
|
|
2,349 |
|
Segment profit |
|
$ |
1,551 |
|
|
$ |
1,561 |
|
|
$ |
1,379 |
|
|
$ |
4,491 |
|
|
$ |
1,460 |
|
|
$ |
1,938 |
|
|
$ |
1,016 |
|
|
$ |
4,414 |
|
Year-over-Year Quarter Comparison |
|
|
|
|
|
|
|
Three months ended June 30, 2017 |
|
Three months ended June 30, 2016 |
|
|
IBW |
|
ISMS |
|
CNS |
|
Total |
|
IBW |
|
ISMS |
|
CNS |
|
Total |
|
Total revenue |
|
$ |
6,956 |
|
|
$ |
4,130 |
|
|
$ |
5,488 |
|
|
$ |
16,574 |
|
|
$ |
6,121 |
|
|
$ |
4,139 |
|
|
$ |
4,556 |
|
|
$ |
14,816 |
|
|
Gross profit |
|
3,014 |
|
|
2,126 |
|
|
1,627 |
|
|
6,767 |
|
|
994 |
|
|
2,019 |
|
|
1,552 |
|
|
4,565 |
|
|
Gross margin (1) |
|
43.3 |
% |
|
51.5 |
% |
|
29.6 |
% |
|
40.8 |
% |
|
16.2 |
% |
|
48.8 |
% |
|
34.1 |
% |
|
30.8 |
% |
|
R&D
expenses |
|
1,463 |
|
|
565 |
|
|
248 |
|
|
2,276 |
|
|
2,364 |
|
|
1,294 |
|
|
619 |
|
|
4,277 |
|
|
Segment profit
(loss) |
|
$ |
1,551 |
|
|
$ |
1,561 |
|
|
$ |
1,379 |
|
|
$ |
4,491 |
|
|
$ |
(1,370 |
) |
|
$ |
725 |
|
|
$ |
933 |
|
|
$ |
288 |
|
|
|
(1)
1Q17 IBW Adjusted Segment Gross Margin was 39.0% when excluding a
charge of $1.4 million related to the previously announced
discontinuation of the ClearLink DAS and stock-based
compensation. Please refer to the GAAP to non-GAAP
reconciliation of IBW segment gross margin at the end of the
Segment Statement of Operations section. |
Reconciliation of GAAP to non-GAAP IBW Segment Gross
Margin |
|
|
|
|
|
|
|
|
|
Three months ended June
30, 2017 |
|
Three months endedMarch 31, 2017 |
|
Three months endedJune 30, 2016 |
|
|
Revenue |
|
Gross Profit |
|
Gross Margin |
|
Revenue |
|
Gross Profit |
|
Gross Margin |
|
Revenue |
|
Gross Profit |
|
Gross Margin |
GAAP - IBW segment |
|
$ |
6,956 |
|
|
$ |
3,014 |
|
|
43.3 |
% |
|
$ |
6,944 |
|
|
$ |
2,933 |
|
|
42.2 |
% |
|
$ |
6,121 |
|
|
$ |
994 |
|
|
16.2 |
% |
ClearLink DAS E&O
(1) |
|
— |
|
|
— |
|
|
|
|
— |
|
|
— |
|
|
|
|
— |
|
|
1,389 |
|
|
|
Stock-based
compensation (2) |
|
— |
|
|
8 |
|
|
|
|
— |
|
|
(10 |
) |
|
|
|
— |
|
|
3 |
|
|
|
Non-GAAP - IBW
segment |
|
$ |
6,956 |
|
|
$ |
3,022 |
|
|
43.4 |
% |
|
$ |
6,944 |
|
|
$ |
2,923 |
|
|
42.1 |
% |
|
$ |
6,121 |
|
|
$ |
2,386 |
|
|
39.0 |
% |
|
(1) Excess and Obsolete inventory charges on
ClearLink DAS inventory and firm purchase commitments. |
(2) Stock-based compensation is a non-cash expense
incurred in accordance with share-based compensation accounting
standards. |
Westell Technologies,
Inc.Reconciliation of GAAP to non-GAAP Financial
Measures(Amounts in thousands, except per share
amounts)(Unaudited) |
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
|
June 30, |
|
March 31, |
|
June 30, |
|
|
|
2017 |
|
2017 |
|
2016 |
|
GAAP consolidated
operating expenses |
|
$ |
7,370 |
|
|
$ |
7,375 |
|
|
$ |
12,348 |
|
|
Adjustments: |
|
|
|
|
|
|
|
Stock-based compensation (3) |
|
(305 |
) |
|
(238 |
) |
|
(400 |
) |
|
Long-lived asset impairment (4) |
|
— |
|
|
— |
|
|
(1,181 |
) |
|
Amortization of intangibles (5) |
|
(1,047 |
) |
|
(1,151 |
) |
|
(1,200 |
) |
|
Restructuring, separation, and transition (6) |
|
— |
|
|
(100 |
) |
|
36 |
|
|
Total
adjustments |
|
(1,352 |
) |
|
(1,489 |
) |
|
(2,745 |
) |
|
Non-GAAP consolidated
operating expenses |
|
$ |
6,018 |
|
|
$ |
5,886 |
|
|
$ |
9,603 |
|
|
|
|
Three months ended |
|
|
|
June 30, |
|
March 31, |
|
June 30, |
|
|
|
2017 |
|
2017 |
|
2016 |
|
GAAP consolidated net
income (loss) |
|
$ |
(572 |
) |
|
$ |
(556 |
) |
|
$ |
(7,768 |
) |
|
Income tax benefit
(expense) |
|
(12 |
) |
|
(38 |
) |
|
(2 |
) |
|
Other income (expense),
net |
|
43 |
|
|
94 |
|
|
17 |
|
|
GAAP consolidated
operating profit (loss) |
|
$ |
(603 |
) |
|
$ |
(612 |
) |
|
$ |
(7,783 |
) |
|
Adjustments: |
|
|
|
|
|
|
|
Deferred
revenue adjustment (1) |
|
— |
|
|
64 |
|
|
63 |
|
|
ClearLink
DAS E&O (2) |
|
— |
|
|
— |
|
|
1,389 |
|
|
Stock-based compensation (3) |
|
330 |
|
|
248 |
|
|
406 |
|
|
Long-lived asset impairment (4) |
|
— |
|
|
— |
|
|
1,181 |
|
|
Amortization of intangibles (5) |
|
1,047 |
|
|
1,151 |
|
|
1,200 |
|
|
Restructuring, separation, and transition (6) |
|
— |
|
|
100 |
|
|
(36 |
) |
|
Total
adjustments |
|
1,377 |
|
|
1,563 |
|
|
4,203 |
|
|
Non-GAAP consolidated
operating profit (loss) |
|
$ |
774 |
|
|
$ |
951 |
|
|
$ |
(3,580 |
) |
|
Depreciation |
|
230 |
|
|
279 |
|
|
385 |
|
|
Non-GAAP consolidated
Adjusted EBITDA (7) |
|
$ |
1,004 |
|
|
$ |
1,230 |
|
|
$ |
(3,195 |
) |
|
|
|
Three months ended |
|
|
|
June 30, |
|
March 31, |
|
June 30, |
|
|
|
2017 |
|
2017 |
|
2016 |
|
GAAP consolidated net
income (loss) |
|
$ |
(572 |
) |
|
$ |
(556 |
) |
|
$ |
(7,768 |
) |
|
Adjustments: |
|
|
|
|
|
|
|
Deferred
revenue adjustment (1) |
|
— |
|
|
64 |
|
|
63 |
|
|
ClearLink
DAS E&O (2) |
|
— |
|
|
— |
|
|
1,389 |
|
|
Stock-based compensation (3) |
|
330 |
|
|
248 |
|
|
406 |
|
|
Long-lived asset impairment (4) |
|
— |
|
|
— |
|
|
1,181 |
|
|
Amortization of intangibles (5) |
|
1,047 |
|
|
1,151 |
|
|
1,200 |
|
|
Restructuring, separation, and transition (6) |
|
— |
|
|
100 |
|
|
(36 |
) |
|
Total
adjustments |
|
1,377 |
|
|
1,563 |
|
|
4,203 |
|
|
Non-GAAP consolidated
net income (loss) |
|
$ |
805 |
|
|
$ |
1,007 |
|
|
$ |
(3,565 |
) |
|
GAAP consolidated net
income (loss) per common share: |
|
|
|
|
|
|
|
Diluted |
|
$ |
(0.04 |
) |
|
$ |
(0.04 |
) |
|
$ |
(0.51 |
) |
|
Non-GAAP consolidated
net income (loss) per common share: |
|
|
|
|
|
|
|
Diluted |
|
$ |
0.05 |
|
|
$ |
0.06 |
|
|
$ |
(0.23 |
) |
|
Average number of
common shares outstanding: |
|
|
|
|
|
|
|
Diluted |
|
15,617 |
|
|
15,528 |
|
|
15,254 |
|
|
The Company conforms to U.S. Generally Accepted
Accounting Principles (GAAP) in the preparation of its financial
statements. The schedules above reconcile the Company's
non-GAAP financial measures to the most directly comparable GAAP
measure. The adjustments share one or more of the following
characteristics: they are unusual and the Company does not expect
them to recur in the ordinary course of its business; they do not
involve the expenditure of cash; they are unrelated to the ongoing
operation of the business in the ordinary course; or their
magnitude and timing is largely outside of the Company's
control. Management believes that the non-GAAP financial
information provides meaningful supplemental information to
investors. Management also believes the non-GAAP financial
information reflects the Company's core ongoing operating
performance and facilitates comparisons across reporting
periods. The Company uses these non-GAAP measures when
evaluating its financial results. Non-GAAP measures should
not be viewed as a substitute for the Company's GAAP results.
Footnotes:
(1) On April 1, 2013, the Company
purchased Kentrox. The acquisition required the step-down on
acquired deferred revenue, which resulted in lower revenue that
will not recur once those liabilities have fully settled. The
adjustment removes the step-down on acquired deferred revenue that
was recognized.(2) Non-recurring excess and obsolete inventory
charges on inventory and firm purchase commitments associated with
the previously announced strategic decision related to the
discontinuation of ClearLink DAS.(3) Stock-based compensation
is a non-cash expense incurred in accordance with share-based
compensation accounting standards.(4) Non-cash impairment
related to tangible long-lived assets associated with the
previously announced strategic decision related to the
discontinuation of ClearLink DAS.(5) Amortization of
intangibles is a non-cash expense arising from previously acquired
intangible assets.(6) Restructuring expenses are not directly
related to the ongoing performance of our fundamental business
operations, including costs relating to abandonment of excess
office space at our headquarters and in New Hampshire, and
severance costs for terminated employees. This adjustment also
includes severance benefits related to the departure of certain
former executives.(7) EBITDA is a non-GAAP measure that
represents Earnings Before Interest, Taxes, Depreciation, and
Amortization. The Company presents Adjusted EBITDA.
For additional information, contact:
Tom Minichiello
Chief Financial Officer
Westell Technologies, Inc.
+1 (630) 375 4740
tminichiello@westell.com
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