SUWANEE, Ga., Aug. 7, 2013 /PRNewswire/ -- ARRIS Group,
Inc. (NASDAQ:ARRS), today announced preliminary and unaudited
financial results for the second quarter 2013.
On April 17, 2013 the Company
closed the acquisition of Motorola Home. As a result,
comparisons to prior periods will be significantly impacted.
Revenues in the second quarter 2013 were $1,000.4 million as compared to second quarter
2012 revenues of $349.3 million and
as compared to first quarter 2013 revenues of $353.7 million. The Company estimates that
prior to the close of the acquisition, Motorola Home recorded
approximately $66 million of revenue
in the second quarter. Through the first two quarters of 2013
and 2012, revenues were $1,354.0
million and $652.2 million,
respectively. As previously disclosed, the first quarter 2013
revenue reflects a $13.2 million
reduction related to Comcast's investment in ARRIS associated with
the Company's acquisition of Motorola Home.
Adjusted net income (a non-GAAP measure) in the second quarter
2013 was $0.46 per diluted share,
compared to $0.25 per diluted share
for the first quarter 2013 and $0.25
per diluted share for the second quarter 2012. The Company
estimates that prior to the close of the acquisition, Motorola
Home generated an operating loss of approximately
$(30) million or an equivalent impact
of $(0.15) per share had that result
been included in the Company's second quarter results. Year
to date, adjusted net income was $0.72 per diluted share for 2013 as compared to
$0.44 per diluted share in 2012.
GAAP net loss in the second quarter 2013 was $(0.37) per diluted share, as compared to second
quarter 2012 GAAP net income of $0.13
per diluted share and first quarter 2013 GAAP net loss of
$(0.13) per diluted share. Year to
date, GAAP net loss was $(0.52) per
diluted share in 2013 as compared to GAAP net income of
$0.18 per diluted share in
2012. A reconciliation of adjusted net income to GAAP net
income per diluted share is attached to this release and also can
be found on the Company's website (www.arrisi.com).
The Company ended the second quarter 2013 with $764.1 million of cash resources, which includes
$741.2 million of cash, cash
equivalents and short-term investments, and $22.9 million of long-term marketable security
investments, as compared to $631.3
million, in the aggregate, at the end of the first quarter
2013. The Company generated $294.0 million of cash from operating activities
during the second quarter 2013 and $344.0
million through the first six months of 2013, which compares
to $30.6 million and $65.9 million generated during the same periods
in 2012. Much of the cash from operating activities relates
to working capital changes, in particular accounts payable and
inventory. Accounts payable was affected by transitional services
provided by Google, following the Motorola Home acquisition. In the
third quarter 2013 the Company anticipates decreasing accounts
payable and accrued liabilities by approximately $200 million. The Company and Google have
settled certain litigation matters for which the Company's maximum
liability is $50 million under the
terms of the acquisition agreement. The Company anticipates
paying the litigation settlement in the third quarter
2013.
Order backlog at the end of the second quarter 2013 was
$534.9 million as compared to
$251.9 million and $282.1 million at the end of the second quarter
2012 and the first quarter 2013, respectively. The Company's
book-to-bill ratio in the second quarter 2013 was 0.95 as compared
to the second quarter 2012 of 0.93 and the first quarter 2013 of
1.17.
"I am very pleased with our second quarter and first half
results. The industry continues to react positively to our Motorola
Home acquisition. Our integration plans are well on their way
and ahead of schedule," said Bob
Stanzione, ARRIS Chairman and CEO. "I am encouraged by
the progress we are making in delivering new products to our
customers and by an improving business climate."
"Our second quarter results were in line with our previously
announced revenue guidance and above our Non GAAP EPS guidance,
reflecting a strong start to our integration actions," said
David Potts, ARRIS EVP &
CFO. "With respect to the third quarter 2013, we now project
that revenues for the Company will be in the range of $1,050 to $1,080 million, with adjusted net
income per diluted share in the range of $0.32 to $0.37 and GAAP net loss per diluted
share in the range of $(0.07) to
$(0.12)."
ARRIS management will conduct a conference call at 5:00 pm EDT, today, Wednesday, August 7, 2013, to discuss these
results in detail. You may participate in this conference call by
dialing 888-713-4213 or 617-213-4865 for international calls prior
to the start of the call and providing the ARRIS Group, Inc. name,
conference pass code 18982813 and Bob
Puccini as the moderator. Please note that ARRIS will not
accept any calls related to this earnings release until after the
conclusion of the conference call. A replay of the conference call
can be accessed approximately two hours after the call through
August 12, 2013 by dialing
888-286-8010 or 617-801-6888 for international calls and using the
pass code 24874293. A replay also will be made available for a
period of 12 months following the conference call on ARRIS' website
at www.arrisi.com.
About ARRIS
ARRIS is a premier video and broadband technology company that
transforms how service providers worldwide deliver entertainment
and communications without boundaries. Its powerful
end-to-end platforms enable service and content providers to
improve the way people connect – with each other and with their
favorite content. The Company's vision and expertise continue
to drive the industry's innovations, as they have for more than 60
years. Headquartered north of Atlanta, in Suwanee,
Georgia, ARRIS has R&D, sales and support centers
throughout the world. For more information: www.arrisi.com
Forward-looking statements:
Statements made in this press release, including those related
to:
- growth expectations and business prospects;
- revenues and net income for the third quarter 2013, and
beyond;
- the integration of the Motorola Home business
- expected sales levels and acceptance of new ARRIS products;
and
- the general market outlook and industry trends
are forward-looking statements. These statements involve risks
and uncertainties that may cause actual results to differ
materially from those set forth in these statements. Among
other things,
- projected results for the third quarter 2013 as well as the
general outlook for 2013 and beyond are based on preliminary
estimates, assumptions and projections that management believes to
be reasonable at this time, but are beyond management's
control;
- we may encounter difficulties in combining the Motorola Home
operations with ours, including difficulties combining personnel,
facilities, and other operations or preserving customer
relationships;
- ARRIS' customers operate in a capital intensive consumer based
industry, and the current volatility in the capital markets or
changes in customer spending may adversely impact their ability or
willingness to purchase the products that the Company offers;
and
- because the market in which ARRIS operates is volatile, actions
taken and contemplated may not achieve the desired impact relative
to changing market conditions and the success of these strategies
will be dependent on the effective implementation of those plans
while minimizing organizational disruption.
In addition to the factors set forth elsewhere in this release,
other factors that could cause results to differ from current
expectations include: the uncertain current economic climate and
its impact on our customers' plans and access to capital; the
impact of rapidly changing technologies; the impact of competition
on product development and pricing; the ability of ARRIS to react
to changes in general industry and market conditions including
regulatory developments; rights to intellectual property, market
trends and the adoption of industry standards; and consolidations
within the telecommunications industry of both the customer and
supplier base. These factors are not intended to be an
all-encompassing list of risks and uncertainties that may affect
the Company's business. Additional information regarding these and
other factors can be found in ARRIS' reports filed with the
Securities and Exchange Commission, including its Form 10-Q for the
quarter ended March 31, 2013.
In providing forward-looking statements, the Company expressly
disclaims any obligation to update publicly or otherwise these
statements, whether as a result of new information, future events
or otherwise.
ARRIS GROUP,
INC.
|
PRELIMINARY
CONSOLIDATED BALANCE SHEETS
|
(in
thousands)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
March
31,
|
|
December
31,
|
|
September
30,
|
|
June
30,
|
|
|
|
2013
|
|
2013
|
|
2012
|
|
2012
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
610,502
|
|
$
423,551
|
|
$
131,703
|
|
$
188,653
|
|
$
199,395
|
|
Short-term
investments, at fair value
|
|
130,723
|
|
184,838
|
|
398,414
|
|
359,753
|
|
340,166
|
|
Total
cash, cash equivalents and short term investments
|
|
741,225
|
|
608,389
|
|
530,117
|
|
548,406
|
|
539,561
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restricted
cash
|
|
3,801
|
|
4,689
|
|
4,722
|
|
4,665
|
|
3,942
|
|
Accounts receivable,
net
|
|
662,156
|
|
206,236
|
|
188,581
|
|
171,143
|
|
179,371
|
|
Other
receivables
|
|
11,007
|
|
3,743
|
|
350
|
|
578
|
|
1,414
|
|
Inventories,
net
|
|
320,778
|
|
126,530
|
|
133,848
|
|
137,496
|
|
102,361
|
|
Prepaid income
taxes
|
|
38,186
|
|
10,703
|
|
9,235
|
|
8,300
|
|
4,090
|
|
Prepaids
|
|
17,296
|
|
13,227
|
|
11,682
|
|
12,408
|
|
12,124
|
|
Current deferred
income tax assets
|
|
127,225
|
|
25,927
|
|
24,944
|
|
20,787
|
|
21,972
|
|
Other current
assets
|
|
283,491
|
|
13,674
|
|
16,413
|
|
10,607
|
|
12,676
|
|
Total
current assets
|
|
2,205,165
|
|
1,013,118
|
|
919,892
|
|
914,390
|
|
877,511
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
404,157
|
|
54,109
|
|
54,378
|
|
54,593
|
|
56,175
|
|
Goodwill
|
|
807,142
|
|
193,976
|
|
194,115
|
|
194,469
|
|
194,626
|
|
Intangible assets,
net
|
|
1,372,196
|
|
86,926
|
|
94,529
|
|
102,258
|
|
110,000
|
|
Investments
|
|
78,733
|
|
55,938
|
|
86,164
|
|
57,483
|
|
70,967
|
|
Noncurrent deferred
income tax assets
|
|
12,340
|
|
52,410
|
|
47,431
|
|
49,589
|
|
47,228
|
|
Other
assets
|
|
55,476
|
|
11,089
|
|
9,385
|
|
9,913
|
|
10,575
|
|
|
|
$
4,935,209
|
|
$
1,467,566
|
|
$
1,405,894
|
|
$
1,382,695
|
|
$
1,367,082
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
485,291
|
|
$
47,783
|
|
$
45,719
|
|
$
49,061
|
|
$
44,800
|
|
Accrued compensation,
benefits and related taxes
|
|
88,382
|
|
36,791
|
|
29,773
|
|
35,066
|
|
28,165
|
|
Accrued
warranty
|
|
40,206
|
|
2,768
|
|
2,882
|
|
3,036
|
|
2,995
|
|
Deferred
revenue
|
|
80,254
|
|
61,431
|
|
44,428
|
|
50,859
|
|
63,023
|
|
Current portion of LT
debt
|
|
289,990
|
|
225,368
|
|
222,124
|
|
-
|
|
-
|
|
Current income taxes
liability
|
|
8,887
|
|
350
|
|
853
|
|
-
|
|
56
|
|
Other accrued
liabilities
|
|
498,788
|
|
59,055
|
|
24,942
|
|
21,768
|
|
23,924
|
|
Total
current liabilities
|
|
1,491,798
|
|
433,546
|
|
370,721
|
|
159,790
|
|
162,963
|
|
Long-term debt, net
of current portion
|
|
1,837,952
|
|
-
|
|
-
|
|
218,943
|
|
215,823
|
|
Accrued
pension
|
|
60,216
|
|
27,200
|
|
26,883
|
|
26,172
|
|
25,696
|
|
Accrued severance
liability, net of current portion
|
|
3,782
|
|
4,262
|
|
4,119
|
|
3,895
|
|
3,758
|
|
Noncurrent income
taxes payable
|
|
35,320
|
|
30,168
|
|
24,389
|
|
24,434
|
|
26,676
|
|
Noncurrent deferred
income tax liabilities
|
|
190,176
|
|
351
|
|
351
|
|
334
|
|
340
|
|
Other noncurrent
liabilities
|
|
48,196
|
|
18,836
|
|
19,043
|
|
20,362
|
|
21,039
|
|
Total
liabilities
|
|
3,667,440
|
|
514,363
|
|
445,506
|
|
453,930
|
|
456,295
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
|
|
|
|
|
Preferred
stock
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Common
stock
|
|
1,726
|
|
1,509
|
|
1,488
|
|
1,479
|
|
1,473
|
|
Capital in excess of
par value
|
|
1,657,383
|
|
1,292,971
|
|
1,285,575
|
|
1,270,561
|
|
1,259,946
|
|
Treasury stock at
cost
|
|
(306,330)
|
|
(306,330)
|
|
(306,330)
|
|
(306,330)
|
|
(295,960)
|
|
Unrealized gain
(loss) on marketable securities
|
|
(19)
|
|
288
|
|
206
|
|
74
|
|
211
|
|
Unfunded pension
liability
|
|
(8,558)
|
|
(8,592)
|
|
(8,558)
|
|
(10,231)
|
|
(10,231)
|
|
Accumulated
deficit
|
|
(76,736)
|
|
(26,459)
|
|
(11,809)
|
|
(26,604)
|
|
(44,468)
|
|
Cumulative
translation adjustments
|
|
303
|
|
(184)
|
|
(184)
|
|
(184)
|
|
(184)
|
|
Total
stockholders' equity
|
|
1,267,769
|
|
953,203
|
|
960,388
|
|
928,765
|
|
910,787
|
|
|
|
$
4,935,209
|
|
$
1,467,566
|
|
$
1,405,894
|
|
$
1,382,695
|
|
$
1,367,082
|
|
ARRIS GROUP,
INC.
|
PRELIMINARY
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(in thousands,
except per share data)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
For the Three
Months
|
|
For the Six
Months
|
|
Ended June
30,
|
|
Ended June
30,
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
|
|
|
|
|
|
|
Net sales
|
$1,000,362
|
|
$
349,327
|
|
$1,354,012
|
|
$
652,227
|
Cost of
sales
|
769,285
|
|
230,801
|
|
1,014,409
|
|
424,793
|
Gross
margin
|
231,077
|
|
118,526
|
|
339,603
|
|
227,434
|
Operating
expenses:
|
|
|
|
|
|
|
|
Selling, general, and
administrative expenses
|
87,774
|
|
40,135
|
|
127,900
|
|
79,678
|
Research and
development expenses
|
123,400
|
|
42,881
|
|
167,482
|
|
87,028
|
Acquisition and other
costs
|
19,392
|
|
102
|
|
26,582
|
|
709
|
Loss on sale of
product line
|
-
|
|
-
|
|
-
|
|
337
|
Restructuring
charges
|
32,257
|
|
1,039
|
|
32,266
|
|
6,242
|
Amortization of
intangible assets
|
58,130
|
|
7,444
|
|
65,733
|
|
14,823
|
|
320,953
|
|
91,601
|
|
419,963
|
|
188,817
|
Operating
income
|
(89,876)
|
|
26,925
|
|
(80,360)
|
|
38,617
|
Other expense
(income):
|
|
|
|
|
|
|
|
Interest
expense
|
18,612
|
|
4,422
|
|
23,243
|
|
8,772
|
Loss (gain) on
investments
|
(728)
|
|
356
|
|
(1,293)
|
|
(605)
|
Loss on foreign
currency
|
206
|
|
540
|
|
1,027
|
|
1,348
|
Interest
income
|
(640)
|
|
(729)
|
|
(1,478)
|
|
(1,484)
|
Other (income)
expense, net
|
(7,735)
|
|
(226)
|
|
11,681
|
|
(662)
|
Income (loss) from
continuing operations before income taxes
|
(99,591)
|
|
22,562
|
|
(113,540)
|
|
31,248
|
Income tax expense
(benefit)
|
(49,314)
|
|
7,561
|
|
(48,613)
|
|
10,448
|
Net
income (loss)
|
$
(50,277)
|
|
$
15,001
|
|
$
(64,927)
|
|
$
20,800
|
|
|
|
|
|
|
|
|
Net income (loss) per
common share:
|
|
|
|
|
|
|
|
Basic
|
$
(0.37)
|
|
$
0.13
|
|
$
(0.52)
|
|
$
0.18
|
Diluted
|
$
(0.37)
|
|
$
0.13
|
|
$
(0.52)
|
|
$
0.18
|
|
|
|
|
|
|
|
|
Weighted average
common shares:
|
|
|
|
|
|
|
|
Basic
|
134,626
|
|
113,842
|
|
124,940
|
|
114,457
|
Diluted
|
134,626
|
|
115,111
|
|
124,940
|
|
116,352
|
ARRIS GROUP,
INC.
|
PRELIMINARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(in
thousands)
|
(unaudited)
|
|
|
|
|
|
For the Three
Months
|
|
For the Six
Months
|
|
|
|
|
|
Ended June
30,
|
|
Ended June
30,
|
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Activities:
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
(50,277)
|
|
$
15,001
|
|
$
(64,927)
|
|
$
20,800
|
|
|
Depreciation
|
|
15,609
|
|
6,982
|
|
22,118
|
|
14,177
|
|
|
Amortization of
intangible assets
|
|
58,130
|
|
7,444
|
|
65,733
|
|
14,823
|
|
|
Amortization of
deferred finance fees
|
|
2,077
|
|
160
|
|
2,237
|
|
320
|
|
|
Non-cash interest
expense
|
|
3,308
|
|
3,058
|
|
6,552
|
|
6,057
|
|
|
Deferred income tax
provision (benefit)
|
|
(35,202)
|
|
(5,085)
|
|
(41,197)
|
|
(9,720)
|
|
|
Stock compensation
expense
|
|
7,180
|
|
7,867
|
|
13,924
|
|
14,516
|
|
|
Reduction in revenue
related to Comcast investment in ARRIS
|
|
-
|
|
-
|
|
13,182
|
|
-
|
|
|
Mark-to-market fair
value adjustment related to Comcast investment in ARRIS
|
(6,159)
|
|
-
|
|
13,189
|
|
-
|
|
|
Provision for
doubtful accounts
|
|
-
|
|
-
|
|
-
|
|
54
|
|
|
Loss on sale of
product line
|
|
-
|
|
-
|
|
-
|
|
337
|
|
|
Loss (gain) on
disposal of fixed assets
|
|
(34)
|
|
3
|
|
(38)
|
|
6
|
|
|
Gain on
investments
|
|
(428)
|
|
356
|
|
(992)
|
|
(605)
|
|
|
Gain on equity
investments
|
|
(301)
|
|
-
|
|
(301)
|
|
-
|
|
|
Excess tax benefits
from stock-based compensation plans
|
|
(1,111)
|
|
(806)
|
|
(5,770)
|
|
(2,460)
|
|
Changes in operating
assets & liabilities, net of effects of acquisitions and
disposals:
|
|
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
1,141
|
|
4,056
|
|
(16,514)
|
|
(27,743)
|
|
|
Other
receivables
|
|
(3,238)
|
|
3,700
|
|
(7,127)
|
|
7,393
|
|
|
Inventory
|
|
85,314
|
|
2,753
|
|
92,632
|
|
9,996
|
|
|
Income taxes
payable/recoverable
|
|
(20,441)
|
|
2,087
|
|
(16,633)
|
|
8,452
|
|
|
Accounts payable and
accrued liabilities
|
|
223,282
|
|
(17,262)
|
|
251,296
|
|
5,136
|
|
|
Other, net
|
|
15,102
|
|
279
|
|
16,645
|
|
4,327
|
|
|
|
Net cash provided
by operating activities
|
|
293,952
|
|
30,593
|
|
344,009
|
|
65,866
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing
Activities:
|
|
|
|
|
|
|
|
|
|
Purchases of
investments
|
|
(58,021)
|
|
(62,587)
|
|
(58,021)
|
|
(140,353)
|
|
Disposals of
investments
|
|
113,310
|
|
31,253
|
|
358,021
|
|
83,161
|
|
Purchases of property
& equipment, net
|
|
(15,113)
|
|
(5,494)
|
|
(21,402)
|
|
(9,256)
|
|
Sale of property
& equipment
|
|
37
|
|
-
|
|
90
|
|
-
|
|
Cash paid for
acquisition, net of cash acquired
|
|
(2,159,762)
|
|
-
|
|
(2,159,762)
|
|
-
|
|
Sale of product
line
|
|
-
|
|
-
|
|
-
|
|
3,249
|
|
|
|
Net cash used in
investing activities
|
|
(2,119,549)
|
|
(36,828)
|
|
(1,881,074)
|
|
(63,199)
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing
Activities:
|
|
|
|
|
|
|
|
|
|
Proceeds from
issuance of debt
|
|
1,925,000
|
|
-
|
|
1,925,000
|
|
-
|
|
Cash paid for debt
discount
|
|
(9,853)
|
|
-
|
|
(9,853)
|
|
-
|
|
Payment of debt
obligations
|
|
(15,813)
|
|
-
|
|
(15,813)
|
|
-
|
|
Early redemption of
long-term debt
|
|
(79)
|
|
-
|
|
(79)
|
|
-
|
|
Deferred financing
costs paid
|
|
(42,207)
|
|
-
|
|
(42,207)
|
|
-
|
|
Repurchase of common
stock
|
|
-
|
|
(15,236)
|
|
-
|
|
(41,551)
|
|
Excess income tax
benefits from stock-based compensation plans
|
|
1,111
|
|
806
|
|
5,770
|
|
2,460
|
|
Repurchase of shares
to satisfy employee tax withholdings
|
|
(415)
|
|
(19)
|
|
(12,407)
|
|
(8,052)
|
|
Fees and proceeds
from issuance of common stock, net
|
|
154,804
|
|
4,271
|
|
165,453
|
|
7,996
|
|
|
|
Net cash used in
financing activities
|
|
2,012,548
|
|
(10,178)
|
|
2,015,864
|
|
(39,147)
|
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
186,951
|
|
(16,413)
|
|
478,799
|
|
(36,480)
|
Cash and cash
equivalents at beginning of period
|
|
423,551
|
|
215,808
|
|
131,703
|
|
235,875
|
Cash and cash
equivalents at end of period
|
|
$
610,502
|
|
$
199,395
|
|
$
610,502
|
|
$
199,395
|
ARRIS GROUP,
INC.
|
PRELIMINARY
SUPPLEMENTAL SALES & NET INCOME RECONCILIATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except
per share data)
|
Q1 2013
|
|
Q2 2013
|
|
YTD 2013
|
|
|
|
|
Per
Diluted
|
|
|
|
Per
Diluted
|
|
|
|
|
|
|
Amount
|
|
Share
|
|
Amount
|
|
Share
|
|
Amount
|
|
|
|
Sales
|
$
353,650
|
|
|
|
$
1,000,362
|
|
|
|
$
1,354,012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Highlighted
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
Reduction in revenue related to Comcast investment in
ARRIS
|
13,182
|
|
|
|
-
|
|
|
|
13,182
|
|
|
|
Purchase
accounting impacts of deferred revenue
|
-
|
|
|
|
2,417
|
|
|
|
2,417
|
|
|
|
Sales excluding
highlighted items
|
$
366,832
|
|
|
|
$
1,002,779
|
|
|
|
$
1,369,611
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1 2013
|
|
Q2 2013
|
|
YTD 2013
|
|
|
|
|
Per
Diluted
|
|
|
|
Per
Diluted
|
|
|
|
Per
Diluted
|
|
|
Amount
|
|
Share
|
|
Amount
|
|
Share
|
|
Amount
|
|
Share
|
|
Net income
(loss)
|
$
(14,650)
|
|
$
(0.13)
|
|
$
(50,277)
|
|
$
(0.37)
|
|
$
(64,927)
|
|
$
(0.52)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Highlighted
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
Impacting
gross margin:
|
|
|
|
|
|
|
|
|
|
|
|
|
Reduction in revenue related
to Comcast investment in ARRIS
|
13,182
|
|
0.11
|
|
-
|
|
-
|
|
13,182
|
|
0.10
|
|
Acquisition accounting
impacts related to Motorola Home fair value of inventory
|
-
|
|
-
|
|
57,600
|
|
0.42
|
|
57,600
|
|
0.45
|
|
Product
rationalization
|
-
|
|
-
|
|
13,582
|
|
0.10
|
|
13,582
|
|
0.11
|
|
Stock compensation
expense
|
831
|
|
0.01
|
|
866
|
|
0.01
|
|
1,697
|
|
0.01
|
|
Acquisition accounting
impacts related to Motorola Home deferred revenue
|
-
|
|
-
|
|
1,472
|
|
0.01
|
|
1,472
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impacting
operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition costs and
other
|
7,190
|
|
0.06
|
|
19,392
|
|
0.14
|
|
26,582
|
|
0.21
|
|
Restructuring
|
9
|
|
-
|
|
32,257
|
|
0.24
|
|
32,266
|
|
0.25
|
|
Amortization of intangible
assets
|
7,603
|
|
0.06
|
|
58,130
|
|
0.43
|
|
65,733
|
|
0.51
|
|
Stock compensation
expense
|
5,913
|
|
0.05
|
|
6,314
|
|
0.05
|
|
12,227
|
|
0.10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impacting
other (income) / expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash interest
expense
|
3,244
|
|
0.03
|
|
3,308
|
|
0.02
|
|
6,552
|
|
0.05
|
|
Credit facility - ticking
Fees
|
388
|
|
-
|
|
477
|
|
-
|
|
865
|
|
0.01
|
|
Mark to market FV adjustment
related to Comcast investment in ARRIS
|
19,348
|
|
0.16
|
|
(6,159)
|
|
(0.05)
|
|
13,189
|
|
0.10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impacting
income tax expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments of income tax
valuation allowances and other
|
(7,516)
|
|
(0.06)
|
|
-
|
|
-
|
|
(7,516)
|
|
(0.06)
|
|
Tax related
to highlighted items above
|
(5,735)
|
|
(0.05)
|
|
(74,784)
|
|
(0.55)
|
|
(80,520)
|
|
(0.63)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total highlighted
items
|
44,457
|
|
0.37
|
|
112,455
|
|
0.82
|
|
156,911
|
|
1.23
|
|
Net income excluding
highlighted items
|
$
29,807
|
|
$
0.25
|
|
$
62,178
|
|
$
0.46
|
|
$
91,984
|
|
$
0.72
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares - basic
|
|
|
115,150
|
|
|
|
134,626
|
|
|
|
124,940
|
|
Weighted average
common shares - diluted
|
|
|
119,022
|
|
|
|
136,626
|
|
|
|
127,731
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except
per share data)
|
Q1 2012
|
|
Q2 2012
|
|
YTD 2012
|
|
|
|
|
Per
Diluted
|
|
|
|
Per
Diluted
|
|
|
|
|
|
|
Amount
|
|
Share
|
|
Amount
|
|
Share
|
|
Amount
|
|
|
|
Sales
|
$
302,901
|
|
|
|
$
349,327
|
|
|
|
$
652,228
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Highlighted
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase accounting impacts
of deferred revenue
|
1,258
|
|
0.01
|
|
663
|
|
-
|
|
1,921
|
|
|
|
Sales excluding
highlighted items
|
$
304,159
|
|
|
|
$
349,990
|
|
|
|
$
654,149
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1 2012
|
|
Q2 2012
|
|
YTD 2012
|
|
|
|
|
Per
Diluted
|
|
|
|
Per
Diluted
|
|
|
|
Per
Diluted
|
|
|
Amount
|
|
Share
|
|
Amount
|
|
Share
|
|
Amount
|
|
Share
|
|
Net income
|
$
5,799
|
|
$
0.05
|
|
$
15,001
|
|
$
0.13
|
|
$
20,800
|
|
$
0.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Highlighted
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
Impacting
gross margin:
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition accounting
impacts related to Motorola Home deferred revenue
|
1,258
|
|
0.01
|
|
663
|
|
-
|
|
1,921
|
|
0.02
|
|
Stock compensation
expense
|
750
|
|
0.01
|
|
809
|
|
0.01
|
|
1,559
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impacting
operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition costs and
other
|
944
|
|
0.01
|
|
102
|
|
-
|
|
1,046
|
|
0.01
|
|
Restructuring
|
5,203
|
|
0.04
|
|
1,039
|
|
0.01
|
|
6,242
|
|
0.05
|
|
Amortization of
intangible assets
|
7,379
|
|
0.06
|
|
7,444
|
|
0.05
|
|
14,823
|
|
0.12
|
|
Stock compensation
expense
|
5,899
|
|
0.05
|
|
7,058
|
|
0.05
|
|
12,957
|
|
0.10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impacting
other (income) / expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash interest
expense
|
2,999
|
|
0.03
|
|
3,058
|
|
0.02
|
|
6,057
|
|
0.05
|
|
Impairment of
investment
|
-
|
|
-
|
|
466
|
|
-
|
|
466
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax related
to highlighted items above
|
(8,121)
|
|
(0.07)
|
|
(6,749)
|
|
(0.05)
|
|
(14,870)
|
|
(0.12)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total highlighted
items
|
16,311
|
|
0.14
|
|
13,890
|
|
0.12
|
|
30,201
|
|
0.26
|
|
Net income excluding
highlighted items
|
$
22,110
|
|
$
0.19
|
|
$
28,891
|
|
$
0.25
|
|
$
51,001
|
|
$
0.44
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares - diluted
|
|
|
117,597
|
|
|
|
115,111
|
|
|
|
116,514
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE ARRIS Group, Inc.