STLW Stratos Intl (MM)

Reports Q4 Revenues of $26 Million, a 26% Increase over Prior Year CHICAGO, June 14 /PRNewswire-FirstCall/ -- Stratos International, Inc. (NASDAQ:STLW), today announced financial results for its fourth quarter and fiscal year ended April 30, 2007. Sales for the fourth quarter of fiscal 2007 were $25.5 million. Stratos also recorded license fees and royalty income of $0.6 million. Total revenues were $26.0 million in the fourth quarter of fiscal 2007, a 26% increase over total revenues of $20.7 million in the fourth quarter of fiscal 2006. The net income attributable to common stockholders for the fourth quarter of fiscal 2007 was $0.6 million, or $0.04 per share on a diluted basis. By comparison, in the fourth quarter of fiscal 2006, Stratos reported a net loss attributable to common stockholders of $1.3 million or $0.09 per share on a diluted basis. Andy Harris, President and Chief Executive Officer of Stratos, remarked, "Our fourth quarter results reflect the strength of the company we have built over the last several years. Our goal has been to continue to unlock value in this company by improving operations and turning this company profitable." Full Year Results Sales for the fiscal year ended April 30, 2007 were $91.7 million. Stratos also recorded license fees and royalty income of $1.1 million. For comparison, sales for the fiscal year ended April 30, 2006 were $79.0 million, and license fees and royalties were $0.5 million. The net income attributable to common stockholders for the fiscal year ended April 30, 2007 was $1.3 million, or $0.09 per share. By comparison, for the fiscal year ended April 30, 2006, Stratos reported a net loss attributable to common stockholders of $4.0 million or $0.29 per share. Common shares outstanding as of April 30, 2007 were 14,500,494 shares. Cash and short-term investments at April 30, 2007 were $33.6 million compared to $30.7 million at April 30, 2006. Capital expenditures were $0.3 million in the fourth quarter of fiscal 2007, and $1.1 million in the full fiscal year 2007, compared to $0.2 million in the fourth quarter of fiscal 2006, and $1.0 million in the full fiscal year 2006. Fourth quarter and fiscal year results are preliminary, as the company's auditors have not completed their year-end audit. Webcast of Investor Call Available Today at 4:00PM Central Time President and Chief Executive Officer, Andy Harris, and Chief Financial Officer, Barry Hollingsworth will hold a conference call to discuss Stratos' earnings and operations Thursday, June 14, 2007 at 4:00 p.m. Central Time. Investors and other interested parties may listen to the live web cast by visiting the investor relations section of the Stratos International website at http://www.stratosinternational.com/. An audio replay of the call will be accessible to the public two hours after the call's completion by calling (800) 642-1687 or (706) 645-9291 and then following the prompts to enter conference ID 3494946. The replay will be available for two days following the call. A web cast replay will also be available on Stratos' website. About Stratos International Stratos International, Inc. is a leading designer, developer and manufacturer of RF and microwave, as well as optical subsystems, components and interconnect products used in telecom, enterprise, military and video markets. Stratos has a rich history of optical and mechanical packaging expertise and has been a pioneer in developing several optical devices using innovative form-factors for telecom, datacom and harsh environment applications. This expertise, coupled with several strategic acquisitions, has allowed Stratos to amass a broad range of products and build a strong IP portfolio of more than 150 US patents issued and pending. Stratos currently serves more than 1,300 active customers, primarily in the telecom/datacom, military/aerospace and video markets. Safe Harbor Statement This press release contains predictions and other forward-looking statements. All forward-looking statements in this press release are based on information available to Stratos as of the date hereof, and we assume no obligation to update any such forward-looking statements. Forward-looking statements are subject to risks and uncertainties and actual results may differ materially from any future performance suggested. These factors include rapid technological change in the optical communications industry; fluctuations in operating results; Stratos' dependence on a few large customers; and competition. Other risk factors that may affect the Company's performance are listed in Stratos' annual report on Form 10-K and other reports filed from time to time with the Securities and Exchange Commission (the "SEC"). STRATOS INTERNATIONAL INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (In thousands, except per share amounts and shares outstanding) Three Months Ended Twelve Months Ended April 30 April 30 2007 2006 2007 2006 Revenues: Net sales 25,452 $20,620 91,654 $79,042 License fees and royalties 596 129 1,090 540 Total revenues 26,048 20,749 92,744 79,582 Cost of revenues 15,368 13,071 58,028 50,090 Gross profit 10,680 7,678 34,716 29,492 41.0% 37.0% 37.4% 37.1% Operating expenses Research and development 2,117 2,128 8,177 8,270 Sales and marketing 3,282 2,739 11,141 10,212 General and administrative 5,314 3,993 16,693 15,781 Restructuring and other charges 182 1,023 Litigation settlements, net (400) (1,100) Total operating expenses 10,713 8,642 36,011 34,186 Income (loss) from operations (33) (964) (1,295) (4,694) Interest income, net 383 332 1,821 1,219 Other income 251 440 1,118 838 Income (loss) before income taxes 601 (192) 1,644 (2,637) Income tax provision 3 (226) (14) (194) Net income (loss) 604 (418) 1,630 (2,831) Preferred Stock Dividends (17) ($884) (346) ($1,147) Net income (loss) attributable to Common shareholders (Basic and Diluted) 587 (1,302) 1,284 (3,978) Net incomeloss per share attributable to common shareholders (Basic) $0.04 ($0.09) $0.09 ($0.29) (Diluted) $0.04 ($0.09) $0.09 ($0.29) Weighted average number of Common Shares outstanding: Basic 13,678,000 13,827,000 13,672,000 13,888,000 Weighted average number of Common Shares outstanding: Diluted 14,587,000 13,827,000 14,602,000 13,888,000 STRATOS INTERNATIONAL INC. CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (In thousands, except per share amounts and shares outstanding) April 30 April 30 2007 2006 Assets Current assets Cash and cash equivalents $14,070 $11,742 Short term investments 19,500 19,000 Accounts receivable -- net 15,915 13,606 Inventories 19,092 15,482 Prepaid expenses and other current assets 457 2,427 Total current assets 69,034 62,257 Property plant and equipment, net 11,524 16,437 Intangible assets, net of amortization 10,566 11,832 Goodwill and other long lived assets 5,664 5,664 Assets held for sale 2,600 2,864 Other assets 111 100 Total assets $99,499 $99,154 Liabilities and shareholders' equity: Current liabilities Accounts payable $5,282 $4,724 Accrued expenses 6,371 6,028 Income taxes payable 176 216 Total current liabilities 11,829 10,968 Redeemable Preferred Stock 982 1,979 Total liabilities 12,811 12,947 Shareholders' equity Preferred stock, $0.01 par value: Authorized 1,000,000 shares, issued and outstanding 9,820 and 19,790 shares of Series B redeemable preferred stock at April 30, 2007 and April 30, 2006, respectively -- -- Common stock, $0.01 par value: Authorized 20,000,000 shares, 15,083,302 shares issued and 14,500,494 shares outstanding at April 30, 2007; 14,942,164 shares issued and 14,640,643 shares outstanding at April 30, 2006. 151 149 Cost of shares in treasury (3,723) (1,871) Additional paid in capital 319,847 318,207 Accumulated other comprehensive income (602) (9) Accumulated deficit (228,985) (230,269) Total shareholders' equity 86,688 86,207 Total liabilities and shareholders' equity $99,499 $99,154 DATASOURCE: Stratos International CONTACT: Barry Hollingsworth, Vice President & Chief Financial Officer of Stratos International, +1-708-457-2379, Web site: http://www.stratosinternational.com/

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