Westell Technologies, Inc. (NASDAQ: WSTL), a leading provider of
high-performance network infrastructure solutions, announced
results for its fiscal 2019 second quarter ended September 30,
2018 (2Q19). Management will host a conference call to
discuss 2Q19 results and plans for future growth tomorrow,
Thursday, November 1, 2018, at 9:30 AM Eastern Time (details
below).
Revenue was $10.1 million and comprised $3.6
million from the In-Building Wireless (IBW) segment, $2.6 million
from the Intelligent Site Management (ISM) segment, and $3.8
million from the Communication Network Solutions (CNS)
segment. Cash and short-term investments grew to $28.5
million at September 30, 2018, up from $25.8 million at June 30,
2018, driven by improved working capital, partly offset by an
operating loss and share repurchases.
“We grew cash significantly and continued to
exceed our gross margin target of 40% or greater. While 2Q19
sequential IBW and CNS segment revenues were up slightly, overall
results were affected by lower ISM revenue from one of our larger
customers,” said Stephen John, President and Chief Executive
Officer. “We continue to aggressively pursue growth
opportunities through organic initiatives, partnerships, and
acquisitions. In 2Q19, we received initial customer orders
and recognized our first revenue for the fiber access solutions we
began developing in April of this year. In addition, our
recently announced small cell product agreement positions us to
expand in the market for private LTE networks using the emerging
OnGo spectrum.”
|
|
|
|
|
2Q193 months ended9/30/18 |
1Q193 months ended6/30/18 |
+ increase /- decrease |
Revenue |
$10.1M |
$13.0M |
-$2.9M |
Gross Margin |
41.5% |
45.5% |
-4.0% |
Operating Margin |
-17.4% |
-1.2% |
-16.2% |
Net Income (Loss) |
($1.7M) |
($0.0M) |
-$1.7M |
Earnings (Loss) Per Share |
($0.11) |
($0.00) |
-$0.11 |
Non-GAAP Operating Margin (1) |
-6.2% |
+8.6% |
-14.8% |
Non-GAAP Net Income (Loss) (1) |
($0.5M) |
$1.2M |
-$1.7M |
Non-GAAP Earnings (Loss) Per Share (1) |
($0.03) |
$0.08 |
-$0.11 |
Non-GAAP Adjusted EBITDA (1) |
($0.5M) |
$1.3M |
-$1.8M |
Ending Cash and ST Investments |
$28.5M |
$25.8M |
+$2.7M |
(1) Please refer to the
schedule at the end of this press release for a complete GAAP to
non-GAAP reconciliation and other information related to non-GAAP
financial measures. |
|
In-Building Wireless (IBW)
Segment
IBW’s revenue was up slightly in 2Q19 when
compared to 1Q19, driven primarily by higher sales of DAS
conditioners and passive system components, partly offset by lower
repeater revenue. IBW’s segment profit decrease was due
primarily to the increased R&D expense associated with the OnGo
small cell development.
|
|
|
|
($ in thousands) |
2Q19 3 months ended9/30/18 |
1Q19 3 months ended/30/18 |
+ increase / - decrease |
IBW Segment Revenue |
$3,646 |
$3,557 |
+$89 |
IBW Segment Gross Margin |
46.4% |
46.7% |
-0.3% |
IBW Segment R&D Expense |
$867 |
$522 |
+$345 |
IBW Segment Profit |
$825 |
$1,140 |
-$315 |
|
|
|
|
Intelligent Site Management (ISM)
Segment
ISM’s revenue decrease was due primarily to
lower product revenue as one major domestic customer spent
significantly less on remote monitoring than in previous quarters,
partly offset by increased support services revenue. ISM’s
segment profit decrease was due to the lower revenue.
|
|
|
|
($ in thousands) |
2Q19 3 months ended9/30/18 |
1Q19 3 months ended6/30/18 |
+ increase / - decrease |
ISM Segment Revenue |
$2,646 |
$5,744 |
-$3,098 |
ISM Segment Gross Margin |
53.7% |
51.3% |
+2.4% |
ISM Segment R&D Expense |
$558 |
$569 |
-$11 |
ISM Segment Profit |
$864 |
$2,379 |
-$1,515 |
|
|
|
|
Communication Network Solutions (CNS)
Segment
CNS’s revenue increase was driven primarily by
higher sales of integrated cabinets. CNS’s segment profit
decrease was due primarily to a lower gross margin due to the
revenue mix and slightly higher R&D expense related to product
development activities for the fiber access solutions.
|
|
|
|
($ in thousands) |
2Q19 3 months ended9/30/18 |
1Q19 3 months ended6/30/18 |
+ increase / - decrease |
CNS Segment Revenue |
$3,814 |
$3,736 |
+$78 |
CNS Segment Gross Margin |
28.3% |
35.5% |
-7.2% |
CNS Segment R&D Expense |
$418 |
$341 |
+$77 |
CNS Segment Profit |
$661 |
$984 |
-$323 |
|
|
|
|
Conference Call
InformationManagement will discuss financial and business
results and plans for future growth during the quarterly conference
call on Thursday, November 1, 2018, at 9:30 AM Eastern
Time. Investors may quickly register online in advance of the
call at 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 November 1,
2018, by calling (877) 875-0056 no later than 8:15
AM Central Time (9:15 AM Eastern Time) and providing the operator
confirmation number 47737770.
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 12:00 PM Eastern Time following the conclusion of the
conference.
About Westell
TechnologiesWestell is a leading provider of
high-performance network 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 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,
and the imposition of new, or changes in existing duties and
tariffs), 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, 2018, 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 |
|
Six months ended |
|
|
|
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
|
September 30, |
|
|
|
2018 |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
|
Revenue |
|
$ |
10,106 |
|
|
$ |
13,037 |
|
|
$ |
17,232 |
|
|
$ |
23,143 |
|
|
$ |
33,806 |
|
|
Cost of revenue |
|
5,913 |
|
|
7,102 |
|
|
9,957 |
|
|
13,015 |
|
|
19,764 |
|
|
Gross profit |
|
4,193 |
|
|
5,935 |
|
|
7,275 |
|
|
10,128 |
|
|
14,042 |
|
|
Gross margin |
|
41.5 |
% |
|
45.5 |
% |
|
42.2 |
% |
|
43.8 |
% |
|
41.5 |
% |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
R&D |
|
1,843 |
|
|
1,432 |
|
|
2,205 |
|
|
3,275 |
|
|
4,481 |
|
|
Sales and
marketing |
|
1,876 |
|
|
2,137 |
|
|
1,992 |
|
|
4,013 |
|
|
4,328 |
|
|
General
and administrative |
|
1,400 |
|
|
1,534 |
|
|
1,809 |
|
|
2,934 |
|
|
3,520 |
|
|
Intangible amortization |
|
832 |
|
|
990 |
|
|
1,048 |
|
|
1,822 |
|
|
2,095 |
|
|
Restructuring |
|
— |
|
|
— |
|
|
165 |
|
(1) |
— |
|
|
165 |
|
(1) |
Total
operating expenses |
|
5,951 |
|
|
6,093 |
|
|
7,219 |
|
|
12,044 |
|
|
14,589 |
|
|
Operating profit
(loss) |
|
(1,758 |
) |
|
(158 |
) |
|
56 |
|
|
(1,916 |
) |
|
(547 |
) |
|
Other income, net |
|
165 |
|
|
119 |
|
|
677 |
|
(2) |
284 |
|
|
720 |
|
(2) |
Income (loss) before
income taxes |
|
(1,593 |
) |
|
(39 |
) |
|
733 |
|
|
(1,632 |
) |
|
173 |
|
|
Income tax benefit
(expense) |
|
(10 |
) |
|
— |
|
|
(13 |
) |
|
(10 |
) |
|
(25 |
) |
|
Net income (loss) from
continuing operations |
|
(1,603 |
) |
|
(39 |
) |
|
720 |
|
|
(1,642 |
) |
|
148 |
|
|
Income (loss) from
discontinued operations (3) |
|
(138 |
) |
|
— |
|
|
— |
|
|
(138 |
) |
|
— |
|
|
Net income (loss) |
|
$ |
(1,741 |
) |
|
$ |
(39 |
) |
|
$ |
720 |
|
|
$ |
(1,780 |
) |
|
$ |
148 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income (loss)
per share: |
|
|
|
|
|
|
|
|
|
|
|
Basic net
income (loss) |
|
$ |
(0.11 |
) |
|
$ |
— |
|
|
$ |
0.05 |
|
|
$ |
(0.11 |
) |
|
$ |
0.01 |
|
|
Diluted
net income (loss) |
|
$ |
(0.11 |
) |
|
$ |
— |
|
|
$ |
0.05 |
|
|
$ |
(0.11 |
) |
|
$ |
0.01 |
|
|
Weighted-average number
of common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
15,583 |
|
|
15,632 |
|
|
15,461 |
|
|
15,602 |
|
|
15,471 |
|
|
Diluted |
|
15,583 |
|
|
15,632 |
|
|
15,672 |
|
|
15,602 |
|
|
15,638 |
|
|
(1) During the quarter ended September 30, 2017,
the Company recorded restructuring expense related to severance
costs for terminated employees.(2) During the quarter ended
September 30, 2017, the Company dissolved the NoranTel legal entity
which triggered a one-time $0.6 million foreign currency gain with
the reversal of the cumulative translation adjustment.(3)
During the quarter ended September 30, 2018, the Company recorded
indemnification expense related to probable loss contingencies
associated with a major customer contract related to a business
which was previously sold and therefore is presented as
discontinued operations.
|
|
|
|
|
Westell Technologies,
Inc.Condensed Consolidated Balance
Sheet(Amounts in thousands) |
|
|
|
|
|
|
|
September 30, 2018(Unaudited) |
|
March 31, 2018 |
Assets |
|
|
|
|
Cash and cash equivalents |
|
$ |
28,471 |
|
|
$ |
24,963 |
|
Short-term investments |
|
— |
|
|
2,779 |
|
Accounts receivable, net |
|
6,957 |
|
|
8,872 |
|
Inventories |
|
10,370 |
|
|
9,222 |
|
Prepaid expenses and other current assets |
|
1,131 |
|
|
816 |
|
Total current assets |
|
46,929 |
|
|
46,652 |
|
Land, property and equipment, net |
|
1,463 |
|
|
1,601 |
|
Intangible assets, net |
|
9,613 |
|
|
11,435 |
|
Tax receivable, non-current |
|
697 |
|
|
697 |
|
Other non-current assets |
|
73 |
|
|
74 |
|
Total assets |
|
$ |
58,775 |
|
|
$ |
60,459 |
|
Liabilities and Stockholders’ Equity |
|
|
|
|
Accounts payable |
|
$ |
2,822 |
|
|
$ |
1,903 |
|
Accrued expenses |
|
3,235 |
|
|
3,328 |
|
Accrued restructuring |
|
— |
|
|
63 |
|
Deferred revenue |
|
1,095 |
|
|
1,790 |
|
Total current liabilities |
|
7,152 |
|
|
7,084 |
|
Deferred revenue non-current |
|
557 |
|
|
846 |
|
Other non-current liabilities |
|
241 |
|
|
234 |
|
Total liabilities |
|
7,950 |
|
|
8,164 |
|
Total stockholders’ equity |
|
50,825 |
|
|
52,295 |
|
Total liabilities and stockholders’ equity |
|
$ |
58,775 |
|
|
$ |
60,459 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Westell Technologies,
Inc.Condensed Consolidated Statement of Cash
Flows(Amounts in thousands)(Unaudited) |
|
|
|
|
|
|
|
|
Three monthsendedSeptember 30, |
|
Six
months endedSeptember
30, |
|
|
|
2018 |
|
2018 |
|
2017 |
|
Cash flows from operating
activities: |
|
|
|
Net income (loss) |
|
$ |
(1,741 |
) |
|
$ |
(1,780 |
) |
|
$ |
148 |
|
|
Reconciliation of net income (loss) to net cash used
in operating activities: |
|
|
|
|
|
|
|
Depreciation and amortization |
|
971 |
|
|
2,113 |
|
|
2,526 |
|
|
Stock-based compensation |
|
295 |
|
|
586 |
|
|
672 |
|
|
Loss on sale of fixed assets |
|
1 |
|
|
1 |
|
|
8 |
|
|
Restructuring |
|
— |
|
|
— |
|
|
165 |
|
|
Gain on disposal of foreign operations |
|
— |
|
|
— |
|
|
(608 |
) |
(1) |
Exchange rate loss (gain) |
|
(9 |
) |
|
1 |
|
|
(6 |
) |
|
Changes in assets and liabilities: |
|
|
|
|
|
|
|
Accounts receivable |
|
3,619 |
|
|
1,914 |
|
|
1,025 |
|
|
Inventory |
|
(643 |
) |
|
(1,148 |
) |
|
2,528 |
|
|
Accounts payable and accrued expenses |
|
746 |
|
|
770 |
|
|
(2,306 |
) |
|
Deferred revenue |
|
(463 |
) |
|
(655 |
) |
(2) |
(1,477 |
) |
|
Prepaid expenses and other current assets |
|
152 |
|
|
(315 |
) |
|
375 |
|
|
Other assets |
|
1 |
|
|
1 |
|
|
73 |
|
|
Net cash provided by (used in) operating
activities |
|
2,929 |
|
|
1,488 |
|
|
3,123 |
|
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
Net maturity (purchase) of short-term
investments |
|
1,346 |
|
|
2,779 |
|
|
(5,011 |
) |
|
Purchases of property and equipment, net |
|
(103 |
) |
|
(153 |
) |
|
(254 |
) |
|
Net cash provided by (used in) investing
activities |
|
1,243 |
|
|
2,626 |
|
|
(5,265 |
) |
|
Cash flows from financing activities: |
|
|
|
|
|
|
|
Purchase of treasury stock |
|
(200 |
) |
|
(605 |
) |
|
(456 |
) |
|
Net cash provided by (used in) financing
activities |
|
(200 |
) |
|
(605 |
) |
|
(456 |
) |
|
Gain (loss) of exchange rate changes on cash |
|
2 |
|
|
(1 |
) |
|
20 |
|
|
Net increase (decrease) in cash and cash
equivalents |
|
3,974 |
|
|
3,508 |
|
|
(2,578 |
) |
|
Cash and cash equivalents, beginning of
period |
|
24,497 |
|
(3) |
24,963 |
|
(3) |
21,778 |
|
|
Cash and cash equivalents, end of period |
|
$ |
28,471 |
|
|
$ |
28,471 |
|
|
$ |
19,200 |
|
(3) |
(1) During the quarter ended September 30, 2017, the
Company dissolved the NoranTel legal entity which triggered a
one-time $0.6 million foreign currency gain with the reversal of
the cumulative translation adjustment.(2) Includes the
cumulative effect adjustment of the ASC 606 adoption.(3) As of June
30, 2018, March 31, 2018, and September 30, 2017, the Company had
$1.3 million, $2.8 million and $5.0 million, respectively, 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
September 30, 2018 |
|
Three months ended June 30,
2018 |
|
|
IBW |
|
ISM |
|
CNS |
|
Total |
|
IBW |
|
ISM |
|
CNS |
|
Total |
Total revenue |
|
$ |
3,646 |
|
|
$ |
2,646 |
|
|
$ |
3,814 |
|
|
$ |
10,106 |
|
|
$ |
3,557 |
|
|
$ |
5,744 |
|
|
$ |
3,736 |
|
|
$ |
13,037 |
|
Gross profit |
|
1,692 |
|
|
1,422 |
|
|
1,079 |
|
|
4,193 |
|
|
1,662 |
|
|
2,948 |
|
|
1,325 |
|
|
5,935 |
|
Gross margin |
|
46.4 |
% |
|
53.7 |
% |
|
28.3 |
% |
|
41.5 |
% |
|
46.7 |
% |
|
51.3 |
% |
|
35.5 |
% |
|
45.5 |
% |
R&D expenses |
|
867 |
|
|
558 |
|
|
418 |
|
|
1,843 |
|
|
522 |
|
|
569 |
|
|
341 |
|
|
1,432 |
|
Segment profit |
|
$ |
825 |
|
|
$ |
864 |
|
|
$ |
661 |
|
|
$ |
2,350 |
|
|
$ |
1,140 |
|
|
$ |
2,379 |
|
|
$ |
984 |
|
|
$ |
4,503 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year-over-Year Quarter
Comparison |
|
|
|
|
|
|
|
Three months ended
September 30, 2018 |
|
Three months ended September 30,
2017 |
|
|
IBW |
|
ISM |
|
CNS |
|
Total |
|
IBW |
|
ISM |
|
CNS |
|
Total |
Total revenue |
|
$ |
3,646 |
|
|
$ |
2,646 |
|
|
$ |
3,814 |
|
|
$ |
10,106 |
|
|
$ |
7,919 |
|
|
$ |
4,730 |
|
|
$ |
4,583 |
|
|
$ |
17,232 |
|
Gross profit |
|
1,692 |
|
|
1,422 |
|
|
1,079 |
|
|
4,193 |
|
|
3,650 |
|
|
2,219 |
|
|
1,406 |
|
|
7,275 |
|
Gross margin |
|
46.4 |
% |
|
53.7 |
% |
|
28.3 |
% |
|
41.5 |
% |
|
46.1 |
% |
|
46.9 |
% |
|
30.7 |
% |
|
42.2 |
% |
R&D expenses |
|
867 |
|
|
558 |
|
|
418 |
|
|
1,843 |
|
|
1,443 |
|
|
523 |
|
|
239 |
|
|
2,205 |
|
Segment profit |
|
$ |
825 |
|
|
$ |
864 |
|
|
$ |
661 |
|
|
$ |
2,350 |
|
|
$ |
2,207 |
|
|
$ |
1,696 |
|
|
$ |
1,167 |
|
|
$ |
5,070 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Westell Technologies,
Inc.Reconciliation of GAAP to non-GAAP Financial
Measures(Amounts in thousands, except per share
amounts)(Unaudited) |
|
|
|
|
|
|
|
Three months
ended |
|
Six months
ended |
|
|
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
|
September 30, |
|
|
2018 |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
GAAP consolidated operating expenses |
|
$ |
5,951 |
|
|
$ |
6,093 |
|
|
$ |
7,219 |
|
|
$ |
12,044 |
|
|
$ |
14,589 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
Stock-based compensation (1) |
|
(284 |
) |
|
(279 |
) |
|
(345 |
) |
|
(563 |
) |
|
(650 |
) |
Amortization of intangibles (2) |
|
(832 |
) |
|
(990 |
) |
|
(1,048 |
) |
|
(1,822 |
) |
|
(2,095 |
) |
Restructuring, separation, and transition (3) |
|
— |
|
|
— |
|
|
(165 |
) |
|
— |
|
|
(165 |
) |
Total adjustments |
|
(1,116 |
) |
|
(1,269 |
) |
|
(1,558 |
) |
|
(2,385 |
) |
|
(2,910 |
) |
Non-GAAP consolidated operating expenses |
|
$ |
4,835 |
|
|
$ |
4,824 |
|
|
$ |
5,661 |
|
|
$ |
9,659 |
|
|
$ |
11,679 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended |
|
Six months
ended |
|
|
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
|
September 30, |
|
|
2018 |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
GAAP consolidated net income (loss) |
|
$ |
(1,741 |
) |
|
$ |
(39 |
) |
|
$ |
720 |
|
|
$ |
(1,780 |
) |
|
$ |
148 |
|
Less: |
|
|
|
|
|
|
|
|
|
|
Income tax benefit (expense) |
|
(10 |
) |
|
— |
|
|
(13 |
) |
|
(10 |
) |
|
(25 |
) |
Other income, net |
|
165 |
|
|
119 |
|
|
677 |
|
|
284 |
|
|
720 |
|
Discontinued operations (4) |
|
(138 |
) |
|
$ |
— |
|
|
$ |
— |
|
|
(138 |
) |
|
$ |
— |
|
GAAP consolidated operating profit (loss) |
|
$ |
(1,758 |
) |
|
$ |
(158 |
) |
|
$ |
56 |
|
|
$ |
(1,916 |
) |
|
$ |
(547 |
) |
Adjustments: |
|
|
|
|
|
|
|
|
|
|
Stock-based compensation (1) |
|
295 |
|
|
291 |
|
|
342 |
|
|
586 |
|
|
672 |
|
Amortization of intangibles (2) |
|
832 |
|
|
990 |
|
|
1,048 |
|
|
1,822 |
|
|
2,095 |
|
Restructuring, separation, and transition (3) |
|
— |
|
|
— |
|
|
165 |
|
|
— |
|
|
165 |
|
Total adjustments |
|
1,127 |
|
|
1,281 |
|
|
1,555 |
|
|
2,408 |
|
|
2,932 |
|
Non-GAAP consolidated operating profit (loss) |
|
$ |
(631 |
) |
|
$ |
1,123 |
|
|
$ |
1,611 |
|
|
$ |
492 |
|
|
$ |
2,385 |
|
Depreciation |
|
139 |
|
|
152 |
|
|
201 |
|
|
291 |
|
|
431 |
|
Non-GAAP consolidated Adjusted EBITDA (5) |
|
$ |
(492 |
) |
|
$ |
1,275 |
|
|
$ |
1,812 |
|
|
$ |
783 |
|
|
$ |
2,816 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended |
|
Six months
ended |
|
|
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
|
September 30, |
|
|
2018 |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
GAAP consolidated net income (loss) |
|
$ |
(1,741 |
) |
|
$ |
(39 |
) |
|
$ |
720 |
|
|
$ |
(1,780 |
) |
|
$ |
148 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
Stock-based compensation (1) |
|
295 |
|
|
291 |
|
|
342 |
|
|
586 |
|
|
672 |
|
Amortization of intangibles (2) |
|
832 |
|
|
990 |
|
|
1,048 |
|
|
1,822 |
|
|
2,095 |
|
Restructuring, separation, and transition
(3) |
|
— |
|
|
— |
|
|
165 |
|
|
— |
|
|
165 |
|
Discontinued operations (4) |
|
138 |
|
|
— |
|
|
— |
|
|
138 |
|
|
— |
|
Foreign currency translation adjustment (6) |
|
— |
|
|
— |
|
|
(608 |
) |
|
— |
|
|
(608 |
) |
Total adjustments |
|
1,265 |
|
|
1,281 |
|
|
947 |
|
|
2,546 |
|
|
2,324 |
|
Non-GAAP consolidated net income (loss) |
|
$ |
(476 |
) |
|
$ |
1,242 |
|
|
$ |
1,667 |
|
|
$ |
766 |
|
|
$ |
2,472 |
|
GAAP consolidated net income (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
Diluted |
|
$ |
(0.11 |
) |
|
$ |
— |
|
|
$ |
0.05 |
|
|
$ |
(0.11 |
) |
|
$ |
0.01 |
|
Non-GAAP consolidated net income (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
Diluted |
|
$ |
(0.03 |
) |
|
$ |
0.08 |
|
|
$ |
0.11 |
|
|
$ |
0.05 |
|
|
$ |
0.16 |
|
Average number of common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
Diluted |
|
15,583 |
|
|
15,748 |
|
|
15,672 |
|
|
15,713 |
|
|
15,638 |
|
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) Stock-based compensation is a non-cash
expense incurred in accordance with share-based compensation
accounting standards.(2) Amortization of intangibles is a
non-cash expense arising from previously acquired intangible
assets.(3) Restructuring, separation, and transition
expenses are not directly related to the ongoing performance of our
fundamental business operations.(4) During the quarter ended
September 30, 2018, the Company recorded indemnification expense
related to probable loss contingencies associated with a major
customer contract related to a business which was previously sold
and therefore is presented as discontinued operations.(5)
EBITDA is a non-GAAP measure that represents Earnings Before
Interest, Taxes, Depreciation, and Amortization. The Company
presents Adjusted EBITDA.(6) Non-recurring foreign currency
translation gain related to the wind-up of the NoranTel legal
entity during the quarter ended September 30, 2017.
For additional information, contact:
Tom Minichiello Chief Financial Officer Westell Technologies,
Inc. +1 (630) 375 4740tminichiello@westell.com
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