MILPITAS, Calif., May 2 /PRNewswire/ -- JDSU today reported results
for its fiscal 2007 third quarter ended March 31, 2007. Net revenue
for the third quarter was $361.7 million and net loss was $(14.2)
million, or $(0.07) per share. This compares to net revenue of
$366.3 million and net income of $23.2 million, or $0.10 per
diluted share, reported for the second quarter of fiscal 2007,
which included a $28 million gain on sale of investments. Net
revenue for the third quarter of fiscal 2006 was $314.9 million
with net income of $3.7 million, or $0.02 per diluted share. On a
non-GAAP basis, revenue for the third quarter was $361.8 million
and non-GAAP net income was $12.3 million, or $0.06 per diluted
share. This compares to non-GAAP net revenue of $366.4 million and
non-GAAP net income of $30.0 million, or $0.13 per diluted share,
for the second quarter of fiscal 2007, and to non-GAAP net revenue
of $315.5 million and a non-GAAP net loss of $(2.8) million, or
$(0.01) per share, for the third quarter of fiscal 2006. On an
adjusted EBITDA basis (adjusted Earnings Before Interest, Taxes,
Depreciation and Amortization), the Company earned $17.7 million
for the quarter ended March 31, 2007, which compares to $33.9
million for the second quarter of fiscal 2007, and to $7.9 million
for the third quarter of fiscal 2006. "In terms of revenue, JDSU's
third quarter was stronger than expected, with a much smaller than
anticipated seasonal decline, and year-over-year growth of 15%,"
said Kevin Kennedy, JDSU's Chief Executive Officer. "For the first
time in more than five years, we achieved positive free cash flow,
and we remain committed to focused execution of our profitability
improvement programs." Financial Overview -- Fiscal 2007 Third
Quarter Ended March 31, 2007 -- Communications Test and Measurement
non-GAAP net revenue of $162.9 million was down 3% from last
quarter, and up 28% from the same quarter a year ago. This segment
represented 45% of total revenue. -- Optical Communications
non-GAAP net revenue of $128.7 million was down 3% from last
quarter, and up 1% from the same quarter a year ago, representing
36% of total net revenue. -- Advanced Optical Technologies non-GAAP
net revenue of $45.6 million was up 13% from last quarter, and up
12% from the same quarter a year ago. This segment represented 12%
of total net revenue. -- Reported under the heading of 'All Other,'
the Commercial Lasers business reported non-GAAP net revenue of
$24.6 million, down 2% sequentially and up 19% from the same
quarter a year ago, representing 7% of total net revenue. --
Americas' customers represented 54% of net revenue. European and
Asia- Pacific customers represented 27% and 19% of net revenue,
respectively. -- The Company held $1,223.8 million in cash, cash
equivalents, short-term investments and restricted cash at the end
of the third quarter. Business Outlook The Company expects non-GAAP
net revenue for the fourth quarter of fiscal 2007, ending June 30,
2007, to be in the range of $325 to $345 million. Conference Call
The Company will discuss these results and other related matters at
2:00 p.m. Pacific Time on May 2, 2007 in a live webcast, which will
also be archived for replay on the Company's website at
http://www.jdsu.com/investors. This press release is being
furnished as a Current Report on Form 8-K with the Securities and
Exchange Commission, and will be available at http://www.sec.gov/.
About JDSU JDSU (Nasdaq: JDSU; and TSX: JDU) is committed to
enabling broadband & optical innovation in the communications,
commercial and consumer markets. JDSU is a leading provider of
communications test and measurement solutions and optical products
for telecommunications service providers, cable operators, and
network equipment manufacturers. Furthermore, JDSU is a leading
provider of innovative optical solutions for medical/environmental
instrumentation, semiconductor processing, display, brand
authentication, aerospace and defense, and decorative applications.
More information is available at http://www.jdsu.com/.
Forward-Looking Statements This press release contains, and the
discussions in our subsequent conference call will contain,
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. These statements include: (i) any anticipation or
guidance as to future financial performance, including future
revenue, gross margin, operating expense, operating margin, EBITDA
and other financial metrics; and (ii) the Company's beliefs
regarding the purpose, usefulness and efficacy of non-GAAP results
and the measures and items the Company includes in the same, as
well as any benefits to investors the Company believes its non-GAAP
measures provide. These forward-looking statements involve risks
and uncertainties that could cause actual results to differ
materially from those projected. In particular, the Company's
ability to predict future financial performance continues to be
difficult due to, among other things: (a) continuing general
limited visibility across many of our product lines; (b) the
ongoing potential for significant quarter-over-quarter product mix
fluctuations, which can materially impact profitability measures
due to the broad gross margin range across our portfolio; (c)
continuing consolidation affecting our customer base, which, in the
shorter term limits demand visibility, and, in the longer term,
could reduce our business potential; (d) average selling prices
continue to decline across our traditional Optical Communications
and our Advanced Optical Technologies and Commercial Lasers
businesses; (e) we and many of our Optical Communications suppliers
continue to experience execution and delivery challenges which
limit our revenue and impair our profitability; (f) our
Communications Test and Measurement business is notable for
seasonality and a significant level of in-quarter book-and-ship
business, further limiting our forecasting abilities; (g) we are
currently engaged in various product and manufacturing transfers,
site consolidations and product discontinuances; and (h) Optical
Communications customer supply chain and inventory rationalization
initiatives are further limiting our demand visibility. For more
information on these and other risks affecting the Company's
business, please refer to the "Risk Factors" section included in
the Company's Quarterly Report on Form 10-Q for the quarter ended
December 31, 2006 filed with the Securities and Exchange
Commission, as well as in other filings on Forms 10-Q and 10-K. The
forward-looking statements contained in this news release are made
as of the date hereof and the Company does not assume any
obligation to update the reasons why actual results could differ
materially from those projected in the forward-looking statements.
Contact Information Investors: Jacquie Ross, 408-546-4445 or The
following financial tables are presented in accordance with GAAP,
unless otherwise specified. JDS UNIPHASE CORPORATION CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except per
share data) (unaudited) Three Months Nine Months Ended Ended March
31, April 1, March 31, April 1, 2007 2006 2007 2006 Net revenue
$361.7 $314.9 $1,046.1 $886.1 Cost of sales 226.9 199.4 656.3 614.8
Amortization of acquired developed technologies 9.8 9.6 29.7 26.5
Gross profit 125.0 105.9 360.1 244.8 Operating expenses: Research
and development 43.4 41.3 126.2 115.7 Selling, general and
administrative 95.7 88.2 273.1 241.9 Amortization of other
intangibles 6.6 6.7 19.9 17.7 Acquired in-process research and
development -- 0.1 -- 20.0 Reduction of intangibles and loss on
long-lived assets 3.8 (0.2) 6.9 4.4 Restructuring charges (0.1) 8.8
10.6 28.5 Total operating expenses 149.4 144.9 436.7 428.2 Loss
from operations (24.4) (39.0) (76.6) (183.4) Interest and other
income 16.4 8.7 51.5 16.4 Interest expense (2.1) (0.8) (5.1) (2.3)
Gain (loss) on sale of investments (0.1) 37.7 28.4 72.8 Income
(loss) before income taxes (10.2) 6.6 (1.8) (96.5) Provision for
income taxes 4.0 2.9 6.6 8.9 Net income (loss) $(14.2) $3.7 $(8.4)
$(105.4) Net income (loss) per share Basic $(0.07) $0.02 $(0.04)
$(0.51) Diluted $(0.07) $0.02 $(0.04) $(0.51) Shares used in per
share calculation Basic 211.3 209.9 211.1 204.8 Diluted 211.3 224.3
211.1 204.8 JDS UNIPHASE CORPORATION CONDENSED CONSOLIDATED BALANCE
SHEETS (in millions, unaudited) March 31, July 1, 2007 2006 ASSETS
Current assets: Cash and cash equivalents $452.6 $364.9 Short-term
investments 756.4 857.3 Restricted cash 14.8 16.4 Accounts
receivable, net 255.2 232.3 Inventories, net 220.9 202.2 Refundable
income taxes 5.0 23.9 Other current assets 95.6 108.0 Total current
assets 1,800.5 1,805.0 Property, plant and equipment, net 208.8
201.2 Deferred income taxes 3.5 2.3 Goodwill 679.8 656.7 Other
intangibles, net 342.5 362.0 Long-term investments 4.3 10.8 Other
non-current assets 24.8 27.1 Total assets $3,064.2 $3,065.1
LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts
payable $107.0 $126.6 Accrued payroll and related expenses 58.3
60.6 Income taxes payable 104.4 81.2 Deferred income taxes 1.3 --
Restructuring accrual 5.1 19.8 Warranty accrual 9.6 11.5 Other
current liabilities 111.2 122.7 Total current liabilities 396.9
422.4 Long-term debt 881.0 900.0 Other non-current liabilities
157.1 159.1 Stockholders' equity 1,629.2 1,583.6 Total liabilities
and stockholders' equity $3,064.2 $3,065.1 JDS UNIPHASE CORPORATION
REPORTABLE SEGMENT INFORMATION (in millions, unaudited) Three
Months Nine Months Ended Ended March 31, April 1, March 31, April
1, 2007 2006 2007 2006 Net revenue: Optical Communications $128.7
$127.4 $399.4 $337.5 Communications Test & Measurement 162.9
126.8 447.9 368.2 Advanced Optical Technologies 45.6 40.7 125.3
126.1 All Other, Commercial Lasers 24.6 20.6 73.8 57.9 Deferred
revenue related to purchase accounting adjustment (0.1) (0.6) (0.3)
(3.6) Net revenue $361.7 $314.9 $1,046.1 $886.1 Operating income
(loss): Optical Communications $(1.3) $2.2 $0.8 $(24.7)
Communications Test and Measurement 22.1 15.3 64.7 61.4 Advanced
Optical Technologies 15.8 8.2 39.5 27.4 All Other, Commercial
Lasers 0.5 -- 4.4 (0.7) Corporate (33.8) (32.8) (93.6) (92.9) Total
segment operating income (loss) 3.3 (7.1) 15.8 (29.5) Unallocated
amounts: Stock based compensation (7.5) (4.1) (22.8) (10.7)
Acquisition-related charges and amortization of intangibles (16.4)
(18.9) (50.5) (106.4) Reduction of other long-lived assets (3.8)
0.2 (6.9) (4.4) Restructuring charges 0.1 (8.8) (10.6) (28.5) Other
realignment charges (0.1) (0.3) (1.6) (3.9) Interest and other
income 16.4 8.7 51.5 16.4 Interest expense (2.1) (0.8) (5.1) (2.3)
Gain on sale of investments (0.1) 37.7 28.4 72.8 Income (loss)
before income taxes $(10.2) $6.6 $(1.8) $(96.5) Use of Non-GAAP
(Adjusted) Financial Measures The Company provides non-GAAP
revenue, non-GAAP net income (loss), non- GAAP net income (loss)
per share, EBITDA and adjusted EBITDA financial measures as
supplemental information regarding the Company's operational
performance. The Company evaluates Company-wide segment performance
using, among other things, the measures disclosed in this release
for the purposes of evaluating the Company's historical and
prospective financial performance, as well as its performance
relative to its competitors. Specifically, management uses these
items to further its own understanding of the Company's core
operating performance. The Company believes its "core operating
performance" represents the Company's performance in the ordinary,
ongoing and customary course of its operations. Accordingly,
management excludes from "core operating performance" those items,
such as those relating to restructuring, investing, stock-based
compensation expense and non-cash activities that management does
not believe are reflective of such ordinary, ongoing and customary
course activities. The Company believes that providing this
information to its investors, in addition to the GAAP presentation,
allows investors to see Company results "through the eyes" of
management. The Company further believes that providing this
information allows Company investors to both better understand the
Company's financial performance and, importantly, to evaluate the
efficacy of the methodology and information used by management to
evaluate and measure such performance. The non-GAAP adjustments
described in this release have historically been excluded by the
Company from its non-GAAP measures. The non-GAAP adjustments, and
the basis for excluding them, are outlined below. Restructuring
Activities Cost of goods sold, costs of research and development
and costs of selling, general and administrative related to
restructuring events: The Company has incurred periodic expenses,
included in its GAAP presentation of gross margin and operating
expenses primarily due to additional depreciation from changes in
estimated useful life and the write-down of certain property and
equipment that has been identified for disposal but remained in use
until the date of disposal, workforce related charges such as
retention bonuses and employee relocation costs related to a formal
restructuring plan, building costs for facilities not required for
ongoing operations, and costs related to the relocation of certain
facilities and equipment from buildings which the Company has
disposed of or plans to dispose. The Company excludes these items,
for the purposes of calculating non-GAAP net income (loss),
non-GAAP net income (loss) per share, EBITDA and adjusted EBITDA,
when it evaluates the continuing operational performance of the
Company. The Company believes that these items do not reflect
expected future gross profits or operating expenses nor does the
Company believe that they provide a meaningful evaluation of
current versus past core operational performance. Investment
Activities Gain or loss on sale of available for-sale investments
and reduction in the fair value of investments: The Company has
sold investments or adjusted the value of investments from time to
time based on market conditions. The Company's activities in this
respect are included in the Company's GAAP presentation of net
income (loss) and net income (loss) per share. The Company's core
business does not include making financial investments in third
parties, and such investments do not constitute a material portion
of the Company's assets. Moreover, the amount and timing of gains
and losses and adjustments to the value of investments are
unpredictable. Consequently, the Company believes that gains or
losses on these sales and adjustments to the value of investments
are not related to the ongoing core business and operating
performance of the Company. The Company excludes these items, for
the purposes of calculating non-GAAP net income (loss), non-GAAP
net income (loss) per share, EBITDA and adjusted EBITDA, when it
evaluates the continuing operational performance of the Company.
The Company believes the GAAP measure is not indicative of the
Company's core operating performance. Gain or loss on equity method
investments: The Company records gains or losses on its equity
investments based on our pro-rata share of gains or the net losses
of the investment. The Company's activities in this respect are
included in the Company's GAAP presentation of net income (loss)
and net income (loss) per share. The Company's core business is not
making financial investments in third parties, and such investments
do not constitute a material portion of the Company's assets.
Moreover, the timing and magnitude of gains or losses are
unpredictable, as they are inherently based on the performance of
the third party subject of a particular investment. The Company
excludes these items, for the purposes of calculating non-GAAP net
income (loss), non-GAAP net income (loss) per share, EBITDA and
adjusted EBITDA, when it evaluates the continuing operational
performance of the Company. The Company believes the GAAP measure
is not indicative of its core operating performance. Stock-based
compensation expense: Non-GAAP net income (loss) and net income
(loss) per share excludes stock-based compensation expense under
SFAS 123R for fiscal 2006, and under APB 25 for earlier comparative
periods. The Company excludes this item, for the purposes of
calculating non-GAAP net income (loss), non-GAAP net income (loss)
per share, EBITDA and adjusted EBITDA, when it evaluates the
continuing operational performance of the Company. The Company
believes this GAAP measure is not indicative of its core operating
performance. Non-Cash Activities Amortization of intangibles from
acquisitions: The Company incurs amortization of intangibles,
included in its GAAP presentation of cost of goods sold and
operating expense, related to the various acquisitions it has made.
Management excludes these items, for the purposes of calculating
non- GAAP net income (loss), non-GAAP net income (loss) per share,
EBITDA and adjusted EBITDA, when it evaluates the continuing
operational performance of the Company. The Company believes that
eliminating this expense from operating income is useful to
investors because it believes the GAAP measure, alone, is not
indicative of its core cost of goods sold and operating expenses
and performance. Reduction of goodwill and other long-lived assets:
The Company incurs costs, included in its GAAP presentation of
operating expense, related to the reduction of the carrying value
of goodwill and other long-lived assets primarily related to SFAS
142 and SFAS 144 adjustments, respectively. SFAS 142 and SFAS 144
adjustments typically occur when the financial performance of the
business utilizing the affected assets falls below certain
thresholds or certain assets are designated as held for sale.
Accordingly, SFAS 142 and SFAS 144 related asset value reductions
are non-recurring and generally unpredictable. The Company believes
that eliminating this item, for the purposes of calculating
non-GAAP net income (loss), non-GAAP net income (loss) per share,
EBITDA and adjusted EBITDA, is useful to investors. We believe this
non-GAAP adjustment will assist investors to compare current versus
past performance. The Company's historical adjustments to the
carrying value of certain of its assets under SFAS 142 and SFAS
144, as well as the methodology used by the Company in assessing
the same, are more particularly described in its quarterly reports
on form 10-Q and annual reports on Form 10-K. Interest, taxes, and
depreciation expense: The Company incurs depreciation expense in
its operating results. The Company's calculation of adjusted EBITDA
excludes items as a result of interest, taxes, depreciation and
amortization. Management believes adjusted EBITDA is indicative of
the Company's core operational cash flow. Acquired In-Process
Research and Development: The Company recorded charges for acquired
in-process research and development, included in its GAAP
presentation of operating expense, in connection with its
acquisitions. These amounts were expensed on the acquisition dates
as the acquired technology had not yet reached technological
feasibility and had no future alternative uses. There can be no
assurance that acquisition of businesses, products or technologies
in the future will not result in substantial charges for acquired
IPR&D. Accordingly, acquired IPR&D are non-recurring and
generally unpredictable. The Company believes that eliminating this
expense, for the purposes of calculating non-GAAP net income
(loss), non-GAAP net income (loss) per share, EBITDA and adjusted
EBITDA, is useful to investors. Non-GAAP financial measures are not
in accordance with, or an alternative for, generally accepted
accounting principles in the United States. The GAAP measure most
directly comparable to non-GAAP net income (loss) is net income
(loss). The GAAP measure most directly comparable to non-GAAP net
income (loss) per share is net income (loss) per share. The GAAP
measure most directly comparable to adjusted EBITDA is income
(loss) from operations. The Company believes that these GAAP
measures alone are not indicative of its core operating expenses
and performance. The following tables reconcile the non-GAAP
revenue, net income (loss), net income (loss) per share and
adjusted EBITDA financial measures to GAAP: JDS UNIPHASE
CORPORATION NON-GAAP INFORMATION AND RECONCILIATION TO COMPARABLE
GAAP FINANCIAL MEASURES (in millions, except per share data)
(unaudited) Three Months Ended March 31, April 1, 2007 2006 Net
income Basic Net income Basic (loss) EPS (loss) EPS GAAP measures
$(14.2) $(0.07) $3.7 $0.02 Items reconciling GAAP net income (loss)
& EPS to Non-GAAP net income (loss) & EPS: Related to net
revenues: Deferral of revenues related to acquisition activities
0.1 - 0.6 - Related to cost of sales: Acquisition-related expenses
0.3 - 1.3 0.01 Stock-based compensation expenses 1.0 - 0.9 -
Amortization of acquired developed technologies 9.8 0.05 9.6 0.05
Total related to gross profit 11.2 0.05 12.4 0.06 Related to
operating expenses: Research and development: Stock-based
compensation expenses 2.1 0.01 1.0 - Other non-recurring charges
(0.1) - 0.9 0.01 Selling, general and administrative: Stock-based
compensation expenses 4.4 0.02 2.1 0.01 Other non-recurring charges
(0.2) - 0.1 - Amortization of intangibles 6.6 0.03 6.7 0.03
Acquired in-process research and development - - 0.1 - Reduction of
goodwill - - - - Reduction of intangibles & other long-lived
assets 3.8 0.02 (0.2) - Restructuring charges (0.1) - 8.8 0.04
Total related to operating expenses 16.5 0.08 19.5 0.09 Interest
and other income (1.3) - (0.2) - (Gain) loss on sale of investments
0.1 - (37.7) (0.18) Income tax expenses - - (0.5) - Total related
to net income (loss) & EPS 26.5 0.13 (6.5) (0.03) Non-GAAP
measures $12.3 $0.06 $(2.8) $(0.01) Nine Months Ended March 31,
April 1, 2007 2006 Net income Basic Net income Basic (loss) EPS
(loss) EPS GAAP measures $(8.4) $(0.04) $(105.4) $(0.51) Items
reconciling GAAP net income (loss) & EPS to Non-GAAP net income
(loss) & EPS: Related to net revenues: Deferral of revenues
related to acquisition activities 0.3 - 3.6 0.02 Related to cost of
sales: Acquisition-related expenses 2.2 0.01 37.3 0.18 Stock-based
compensation expenses 3.1 0.01 2.5 0.01 Amortization of acquired
developed technologies 29.7 0.14 26.5 0.13 Total related to gross
profit 35.3 0.16 69.9 0.34 Related to operating expenses: Research
and development: Stock-based compensation expenses 5.7 0.03 2.8
0.01 Other non-recurring charges 0.5 - 1.2 0.01 Selling, general
and administrative: Stock-based compensation expenses 14.0 0.07 5.4
0.03 Other non-recurring charges (0.5) - 4.0 0.02 Amortization of
intangibles 19.9 0.09 17.7 0.08 Acquired in-process research and
development - - 20.0 0.10 Reduction of goodwill - - - - Reduction
of intangibles & other long-lived assets 6.9 0.03 4.4 0.02
Restructuring charges 10.6 0.05 28.5 0.14 Total related to
operating expenses 57.1 0.27 84.0 0.41 Interest and other income
(6.5) (0.03) 1.6 0.01 (Gain) loss on sale of investments (28.4)
(0.13) (72.8) (0.36) Income tax expenses - - 1.0 - Total related to
net income (loss) & EPS 57.5 0.27 83.7 0.40 Non-GAAP measures
$49.1 $0.23 $(21.7) $(0.11) JDS UNIPHASE CORPORATION NON-GAAP
INFORMATION AND RECONCILIATION TO COMPARABLE GAAP FINANCIAL
MEASURES (in millions, except per share data) (unaudited) Three
Months Nine Months Ended Ended March 31, April 1, March 31, April
1, 2007 2006 2007 2006 GAAP net revenue $361.7 $314.9 $1,046.1
$886.1 Deferral of revenues related to acquisition activities 0.1
0.6 0.3 3.6 Non-GAAP net revenue $361.8 $315.5 $1,046.4 $889.7
Three Months Nine Months Ended Ended March 31, April 1, March 31,
April 1, 2007 2006 2007 2006 GAAP net income (loss) $(14.2) $3.7
$(8.4) $(105.4) Interest and other income (16.4) (8.7) (51.5)
(16.4) Interest expense 2.1 0.8 5.1 2.3 (Gain) loss on sale of
investments 0.1 (37.7) (28.4) (72.8) Provision for income taxes 4.0
2.9 6.6 8.9 Depreciation 14.4 15.0 45.4 41.2 Amortization 16.4 16.3
49.6 44.2 EBITDA 6.4 (7.7) 18.4 (98.0) Costs related to
restructuring events (0.1) 8.8 10.6 28.5 Costs related to stock
based compensation expense 7.5 4.0 22.8 10.7 Costs related to
acquisition activities 0.4 1.8 2.5 40.3 Costs related to other non-
recurring activities (0.3) 1.1 - 5.8 Reduction in intangibles and
other long lived assets 3.8 (0.2) 6.9 4.4 Acquired in-process
research and development - 0.1 - 20.0 Adjusted EBITDA $17.7 $7.9
$61.2 $11.7
http://www.newscom.com/cgi-bin/prnh/20050913/SFTU125LOGO
http://photoarchive.ap.org/ DATASOURCE: JDSU CONTACT: Investors:
Jacquie Ross, +1-408-546-4445, or , or Press: Kathleen Greene,
+1-408-546-5852, or , both of JDSU Web site: http://www.jdsu.com/
Copyright