Casa Systems, Inc. (Nasdaq:CASA), a leading provider of converged
broadband infrastructure technology and access device solutions for
mobile, cable and fixed networks, today announced its financial
results for its fourth quarter and year ended December 31, 2019.
Fourth Quarter 2019 Financial Highlights
- Revenue of $112.9 million
- Gross margin of 52.7%
- GAAP net loss of $25.7 million
- Non-GAAP net income of $13.1 million
- GAAP net loss per fully diluted share of $0.31
- Non-GAAP net income per fully diluted share of $0.15
- Adjusted EBITDA of $18.2 million
2019 Financial Highlights
- Revenue of $282.3 million
- Gross margin of 57.6%
- GAAP net loss of $48.2 million
- Non-GAAP net income of $2.6 million
- GAAP net loss per fully diluted share of $0.57
- Non-GAAP net income per fully diluted share of $0.04
- Adjusted EBITDA of $24.0 million
“I am happy to report that we had a better end to the year than
we anticipated, resulting from stronger fourth quarter revenue,”
said Jerry Guo, Casa’s President and CEO. “A healthier cable
spending environment in the fourth quarter, combined with our
ability to recognize revenue from our wireless backlog, were key
factors that drove our better than expected fourth quarter and full
year results. We are starting 2020 with a strong backlog in
all of our product areas, but see our wireless solutions as a
particularly important growth driver for Casa for the coming
year.”
Scott Bruckner, Casa’s Interim CFO added, “During the fourth
quarter and full year, we saw continued diversification in our
customer and product mix. Wireless and fixed telecom
solutions are now both material contributors to our revenues, in
addition to our long-standing cable business. The GAAP net loss for
the quarter and full year includes a charge of $35.2 million for a
valuation allowance that we recorded against our U.S. deferred tax
assets in the fourth quarter. I am pleased to report that we
achieved profitability on a non-GAAP basis both for the fourth
quarter and the full year.”
To supplement our financial results presented in accordance with
Generally Accepted Accounting Principles (GAAP), we are presenting
non-GAAP financial measures in this press release. A reconciliation
of GAAP to non-GAAP measures has been provided in the financial
statement tables included in this press release. An explanation of
these measures is also included below under the heading “Non-GAAP
Financial Measures”.
Financial Outlook
For the fiscal year 2020 we expect:
- Revenue between $340 million and $360 million
- Gross Margin in a range of 50% and 60%
- GAAP net loss between $4 million and $14 million, and adjusted
EBITDA between $33 million and $43 million
- GAAP diluted net loss per share between $(0.04) and $(0.16) and
Non-GAAP diluted net income per share between $0.00 and $0.12
Guidance for non-GAAP financial measures excludes acquisition
costs and other non-recurring expenses, which are one-time
non-recurring charges; stock-based compensation, which is a
non-cash charge; adjustments to valuation allowances on deferred
tax assets; and the resulting tax effect of these excluded items.
We have not reconciled the non-GAAP metrics as to which we provide
guidance to their most directly comparable GAAP metrics because
certain items that impact these excluded measures are uncertain,
out of our control and/or cannot be reasonably calculated or
predicted at this time. Accordingly, a reconciliation of the
non-GAAP financial metrics included in our guidance to the
corresponding GAAP measures is not available without unreasonable
effort.
Conference Call Information
Casa Systems is hosting a conference call for analysts and
investors to discuss the financial results for its fourth quarter
and year ended December 31, 2019, and its business outlook at 5:00
p.m. Eastern Standard Time today, February 20, 2020. The conference
call can be heard via webcast in the investor relations section of
our website at http://investors.casa-systems.com, or by dialing
877-407-4019 in the United States or 201-689-8337 from
international locations. Callers should ask to be joined to
the Casa Systems call. Shortly after the conclusion of
the conference call, a replay of the audio webcast will be
available in the investor relations section of our website at
http://investors.casa-systems.com for 90 days after the
event.
Safe Harbor Statement
This press release contains forward-looking statements within
the meaning of The Private Securities Litigation Reform Act of
1995. All statements other than statements of historical fact
contained in this press release, including statements regarding the
projected results of operations and financial position of Casa
Systems, Inc. (“Casa” or the “Company”), including financial
targets, business strategy, and plans and objectives for future
operations, are forward-looking statements. The words “anticipate”,
“believe”, “continue”, “could”, “estimate”, “expect”, “intend”,
“may”, “plan”, “potential”, “predict”, “project”, “target”,
“should”, “would”, and similar expressions are intended to identify
forward-looking statements, although not all forward-looking
statements contain these identifying words. We have based these
forward-looking statements on our estimates and assumptions of our
financial results and our current expectations and projections
about future events and financial trends that we believe may affect
our financial condition, results of operations, business strategy,
short-term and long-term business operations and objectives and
financial needs as of the date of this press release. A
number of important risk factors could cause actual results to
differ materially from the results described, implied or projected
in these forward-looking statements. These factors include, without
limitation: (1) any failure by us to successfully anticipate
technological shifts, market needs and opportunities, and develop
new products and product enhancements that meet those technological
shifts, needs and opportunities; (2) the concentration of a
substantial portion of our revenue in our CCAP solutions and in
certain customers; (3) fluctuations in our revenue due to timing of
large orders and seasonality; (4) the length and lack of
predictability of our sales cycle; (5) any difficulties we may face
in expanding our platform into the wireless market; (6) any failure
to fully realize anticipated synergies from our acquisition of
NetComm; and (7) other factors discussed in the “Risk Factors”
section of our public reports filed with the SEC, including our
most recent Quarterly Report on Form 10-Q, which is on file with
the SEC and available in the investor relations section of our
website at http://investors.casa-systems.com and on the SEC’s
website at www.sec.gov. In addition, we operate in a very
competitive and rapidly changing environment. New risks emerge from
time to time. It is not possible for our management to predict all
risks, nor can we assess the impact of all factors on our business
or the extent to which any factor, or combination of factors, may
cause actual results to differ materially from those contained in
any forward-looking statements that we may make. In light of these
risks, uncertainties and assumptions, the forward-looking events
and circumstances discussed in this press release are inherently
uncertain and may not occur, and actual results could differ
materially and adversely from those anticipated or implied in the
forward-looking statements. Accordingly, you should not rely upon
forward-looking statements as predictions of future events. We
disclaim any obligation to update publicly or revise any
forward-looking statements for any reason after the date of this
press release. Any reference to our website address in this press
release is intended to be an inactive textual reference only and
not an active hyperlink.
Non-GAAP Financial Measures
To supplement our financial results presented in accordance with
Generally Accepted Accounting Principles (GAAP), we are presenting
the following non-GAAP financial measures in this press release and
the related earnings conference call: non-GAAP net income,
non-GAAP diluted net income per share, adjusted EBITDA and free
cash flow. These non-GAAP financial measures are not based on any
standardized methodology prescribed by GAAP and are not necessarily
comparable to similarly titled measures presented by other
companies.
Non-GAAP net income and non-GAAP diluted net income per
share. We define non-GAAP net income as net (loss) income
as reported in our condensed consolidated statements of operations,
excluding the impact of stock-based compensation expense and
amortization of acquired intangible assets, which are non-cash
charges; acquisition-related expenses, reversal of write-up to fair
value of acquired inventory, restructuring expenses and other
non-recurring expenses and purchase accounting adjustments, which
are one-time non-recurring charges; the follow-on public offering
expenses, which is a one-time non-recurring charge; adjustments to
valuation allowances on deferred tax assets; and the tax effect on
these excluded items. The tax effect of the excluded items for 2019
amounts were calculated based on specific calculations of each
item’s effect on the 2019 tax provision. The tax effect of the
excluded items for 2018 amounts were calculated using our effective
income tax rate for the period, excluding the discrete tax benefits
generated from the exercise of non-qualified stock options and the
disqualifying disposition of incentive stock options. We believe
that excluding these discrete tax benefits from our effective
income tax rate results in more useful disclosure to investors and
others regarding income tax effects of the excluded items as these
amounts may vary from period to period independent of the operating
performance of our business. We define non-GAAP diluted net income
per share as diluted net (loss) income per share reported in our
condensed consolidated statements of operations, excluding the
impact of items that we exclude in calculating non-GAAP net income.
We have presented non-GAAP net income and non-GAAP diluted net
income per share because they are key measures used by our
management and board of directors to understand and evaluate our
operating performance, to establish budgets and to develop
operational goals for managing our business. The presentation of
non-GAAP net income and non-GAAP diluted net income per share also
allows our management and board of directors to make additional
comparisons of our results of operations to other companies in our
industry.
Adjusted EBITDA. We define adjusted EBITDA as
our net (loss) income, excluding the impact of stock-based
compensation expense; acquisition-related expenses; reversal of
write-up to fair value of acquired inventory; restructuring
expenses; other non-recurring expenses and purchase accounting
adjustments; the follow-on public offering expenses; other income
(expense), net; depreciation and amortization expense; and our
provision for (benefit from) income taxes. We have presented
adjusted EBITDA because it is a key measure used by our management
and board of directors to understand and evaluate our operating
performance, to establish budgets and to develop operational goals
for managing our business. In particular, we believe that excluding
the impact of these expenses in calculating adjusted EBITDA can
provide a useful measure for period-to-period comparisons of our
core operating performance.
Free cash flow. We define free cash flow as net
cash provided by operating activities minus capital expenditures.
We believe free cash flow to be a liquidity measure that provides
useful information to management and investors about the amount of
cash generated by our business that, after purchases of property
and equipment, can be used for strategic opportunities, including
investing in our business, making strategic acquisitions and
strengthening our balance sheet.
We use these non-GAAP financial measures to evaluate our
operating performance and trends and make planning decisions. We
believe that each of these non-GAAP financial measures helps
identify underlying trends in our business that could otherwise be
masked by the effect of the expenses that we exclude in the
calculations of each non-GAAP financial measure. Accordingly, we
believe that these financial measures provide useful information to
investors and others in understanding and evaluating our operating
results, enhancing the overall understanding of our past
performance and future prospects.
Our non-GAAP financial measures are not prepared in accordance
with GAAP, and should not be considered in isolation of, or as an
alternative to, measures prepared in accordance with GAAP. There
are a number of limitations related to the use of these non-GAAP
financial measures rather than the most directly comparable
financial measures calculated and presented in accordance with
GAAP. Some of these limitations are:
- we exclude stock-based compensation expense and amortization of
acquired intangible assets from each of non-GAAP net income,
non-GAAP diluted net income per share and adjusted EBITDA as it has
recently been, and will continue to be for the foreseeable future,
a significant recurring non-cash expense for our
business;
- we exclude the discrete tax benefits generated from the
exercise of non-qualified stock options and the disqualifying
disposition of incentive stock options, which are not related to
the operating performance of our business, in calculating the
effective tax rate used to determine the tax effect of the items
excluded from our non-GAAP net income and non-GAAP diluted net
income per share; these discrete tax benefits will result in a
reduction in our income taxes and cash paid for income
taxes;
- we exclude adjustments to our valuation allowance against
deferred tax assets from our non-GAAP net income, non-GAAP
effective tax rate and non-GAAP diluted net income per share, as we
do not believe the charges are reflective of our underlying
operating performance;
- we exclude acquisition-related expenses, reversal of write-up
to fair value of acquired inventory, restructuring expenses and
other non-recurring expenses and purchase accounting adjustments
and the follow-on public offering expenses from non-GAAP net
income, non-GAAP diluted net income per share and adjusted EBITDA
because they are one-time non-recurring charges, although these are
included in our operating expenses;
- adjusted EBITDA excludes depreciation and amortization expense
and, although this is a non-cash expense, the assets being
depreciated and amortized may have to be replaced in the
future;
- adjusted EBITDA does not reflect the cash requirements
necessary to service interest on our debt or the cash received from
our interest-bearing financial assets, both of which impact the
cash available to us, and does not reflect foreign currency
transaction gains and losses, all of which are reflected in other
income (expense), net;
- adjusted EBITDA does not reflect income tax payments that
reduce cash available to us;
- free cash flow may not represent our residual cash flow
available for discretionary expenditures, since we may have other
non-discretionary expenditures that are not deducted from this
measure;
- free cash flow may not represent the total increase or decrease
in the cash and cash equivalents for any given period because it
excludes cash provided by or used for other investing and financing
activities; and
- other companies, including companies in our industry, may not
use non-GAAP net income, non-GAAP diluted net income per share,
adjusted EBITDA or free cash flow, or may calculate such non-GAAP
financial measures in a different manner than we do, or may use
other non-GAAP financial measures to evaluate their performance,
all of which could reduce the usefulness of these non-GAAP
financial measures as comparative measures.
For the reconciliations of these non-GAAP financial measures to
the most directly comparable GAAP financial measures, please see
the section of the accompanying tables titled, “Reconciliation of
Selected GAAP and Non-GAAP Financial Measures.”
About Casa Systems, Inc.
Casa Systems, Inc. (Nasdaq: CASA) delivers converged broadband
solutions that enable mobile, cable and fixed network service
providers to meet the growing demand for gigabit bandwidth and
services. Our suite of distributed and virtualized solutions for
fixed and mobile 5G ultra-broadband networks are engineered for
performance, flexibility and scale. Commercially deployed in over
70 countries, Casa serves more than 475 Tier 1 and regional service
providers worldwide.
For more information, visit our website at
http://www.casa-systems.com.
Source: Casa Systems, Inc.
IR ContactMonica Gould 212-871-3927
investorrelations@casa-systems.com Lindsay Savarese 212-331-8417
investorrelations@casa-systems.com
CASA SYSTEMS,
INC.CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(unaudited)(in thousands,
except per share amounts)
|
|
Three Months Ended
December 31, |
|
|
Year Ended
December 31, |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
112,893 |
|
|
$ |
67,825 |
|
|
$ |
282,297 |
|
|
$ |
297,127 |
|
Cost of revenue |
|
|
53,378 |
|
|
|
18,146 |
|
|
|
119,765 |
|
|
|
79,161 |
|
Gross profit |
|
|
59,515 |
|
|
|
49,679 |
|
|
|
162,532 |
|
|
|
217,966 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
22,508 |
|
|
|
17,345 |
|
|
|
83,331 |
|
|
|
70,974 |
|
Selling, general and administrative |
|
|
27,002 |
|
|
|
15,502 |
|
|
|
88,320 |
|
|
|
68,026 |
|
Total operating expenses |
|
|
49,510 |
|
|
|
32,847 |
|
|
|
171,651 |
|
|
|
139,000 |
|
Income (loss) from
operations |
|
|
10,005 |
|
|
|
16,832 |
|
|
|
(9,119 |
) |
|
|
78,966 |
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income |
|
|
524 |
|
|
|
1,663 |
|
|
|
4,406 |
|
|
|
6,259 |
|
Interest expense |
|
|
(4,860 |
) |
|
|
(5,184 |
) |
|
|
(20,522 |
) |
|
|
(19,763 |
) |
Gain (loss) on foreign currency, net |
|
|
756 |
|
|
|
(466 |
) |
|
|
298 |
|
|
|
(911 |
) |
Other income, net |
|
|
45 |
|
|
|
409 |
|
|
|
522 |
|
|
|
1,387 |
|
Total other income (expense), net |
|
|
(3,535 |
) |
|
|
(3,578 |
) |
|
|
(15,296 |
) |
|
|
(13,028 |
) |
Income (loss) before provision
for (benefit from) income taxes |
|
|
6,470 |
|
|
|
13,254 |
|
|
|
(24,415 |
) |
|
|
65,938 |
|
Provision for (benefit from)
income taxes |
|
|
32,130 |
|
|
|
(1,662 |
) |
|
|
23,791 |
|
|
|
(7,068 |
) |
Net (loss) income |
|
$ |
(25,660 |
) |
|
$ |
14,916 |
|
|
$ |
(48,206 |
) |
|
$ |
73,006 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(0.31 |
) |
|
$ |
0.18 |
|
|
$ |
(0.57 |
) |
|
$ |
0.87 |
|
Diluted |
|
$ |
(0.31 |
) |
|
$ |
0.17 |
|
|
$ |
(0.57 |
) |
|
$ |
0.79 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares used to
compute net (loss) income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
84,126 |
|
|
|
83,060 |
|
|
|
83,853 |
|
|
|
83,539 |
|
Diluted |
|
|
84,126 |
|
|
|
87,971 |
|
|
|
83,853 |
|
|
|
91,877 |
|
CASA SYSTEMS,
INC.RECONCILIATION OF SELECTED GAAP AND NON-GAAP
FINANCIAL MEASURES(unaudited)(in
thousands)
|
|
Three Months Ended
December 31, |
|
|
Twelve Months Ended
December 31, |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Net
(Loss) Income to Non-GAAP Net
Income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
(25,660 |
) |
|
$ |
14,916 |
|
|
$ |
(48,206 |
) |
|
$ |
73,006 |
|
Stock-based compensation |
|
|
2,371 |
|
|
|
2,352 |
|
|
|
9,821 |
|
|
|
8,894 |
|
Acquisition-related expenses |
|
|
101 |
|
|
|
— |
|
|
|
3,494 |
|
|
|
— |
|
Reversal of write-up to fair value of acquired inventory |
|
|
— |
|
|
|
— |
|
|
|
3,200 |
|
|
|
— |
|
Amortization of acquired intangible assets |
|
|
1,426 |
|
|
|
— |
|
|
|
2,852 |
|
|
|
— |
|
Restructuring expenses |
|
|
909 |
|
|
|
— |
|
|
|
1,084 |
|
|
|
— |
|
Other non-recurring expenses and purchase accounting
adjustments |
|
|
— |
|
|
|
— |
|
|
|
776 |
|
|
|
— |
|
Follow-on public offering expenses |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
815 |
|
Valuation allowance |
|
|
35,199 |
|
|
|
|
|
|
|
35,199 |
|
|
|
|
|
Tax effect of excluded items |
|
|
(1,213 |
) |
|
|
2 |
|
|
|
(5,605 |
) |
|
|
(1,217 |
) |
Non-GAAP net income |
|
$ |
13,134 |
|
|
$ |
17,270 |
|
|
$ |
2,615 |
|
|
$ |
81,498 |
|
Non-GAAP net income margin |
|
|
11.6 |
% |
|
|
25.5 |
% |
|
|
0.9 |
% |
|
|
27.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Diluted
Net (Loss) Income Per Share to Non-GAAP
Diluted Net Income Per Share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net (loss) income per
share |
|
$ |
(0.31 |
) |
|
$ |
0.17 |
|
|
$ |
(0.57 |
) |
|
$ |
0.79 |
|
Non-GAAP adjustments to net (loss) income |
|
|
0.46 |
|
|
|
0.03 |
|
|
|
0.61 |
|
|
|
0.09 |
|
Non-GAAP diluted net income per
share |
|
$ |
0.15 |
|
|
$ |
0.20 |
|
|
$ |
0.04 |
|
|
$ |
0.88 |
|
Weighted-average shares used in
computing diluted net (loss) income per share |
|
|
84,126 |
|
|
|
87,971 |
|
|
|
83,853 |
|
|
|
91,877 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Net
(Loss) Income to Adjusted EBITDA: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
(25,660 |
) |
|
$ |
14,916 |
|
|
$ |
(48,206 |
) |
|
$ |
73,006 |
|
Stock-based compensation |
|
|
2,371 |
|
|
|
2,352 |
|
|
|
9,821 |
|
|
|
8,894 |
|
Acquisition-related expenses |
|
|
101 |
|
|
|
— |
|
|
|
3,494 |
|
|
|
— |
|
Reversal of write-up to fair value of acquired inventory |
|
|
— |
|
|
|
— |
|
|
|
3,200 |
|
|
|
— |
|
Restructuring expenses |
|
|
909 |
|
|
|
— |
|
|
|
1,084 |
|
|
|
— |
|
Other non-recurring expenses and purchase accounting
adjustments |
|
|
— |
|
|
|
— |
|
|
|
776 |
|
|
|
— |
|
Follow-on public offering expenses |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
815 |
|
Depreciation and amortization |
|
|
4,819 |
|
|
|
2,417 |
|
|
|
14,722 |
|
|
|
9,454 |
|
Other income, net |
|
|
3,535 |
|
|
|
3,578 |
|
|
|
15,296 |
|
|
|
13,028 |
|
Provision for (benefit from) income taxes |
|
|
32,130 |
|
|
|
(1,662 |
) |
|
|
23,791 |
|
|
|
(7,068 |
) |
Adjusted EBITDA |
|
$ |
18,205 |
|
|
$ |
21,601 |
|
|
$ |
23,978 |
|
|
$ |
98,129 |
|
Adjusted EBITDA margin |
|
|
16.1 |
% |
|
|
31.8 |
% |
|
|
8.5 |
% |
|
|
33.0 |
% |
CASA SYSTEMS,
INC.RECONCILIATION OF SELECTED GAAP AND NON-GAAP
FINANCIAL MEASURES(unaudited)(in
thousands)
|
|
Three Months Ended
December 31, |
|
|
Twelve Months Ended
December 31, |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Net
Cash (Used in) Provided by Operating
Activities to Free Cash Flow: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash (used in) provided by operating activities |
|
$ |
(5,952 |
) |
|
$ |
4,443 |
|
|
$ |
(39,022 |
) |
|
$ |
98,545 |
|
Purchases of property and equipment |
|
|
(1,866 |
) |
|
|
(1,742 |
) |
|
|
(8,591 |
) |
|
|
(7,966 |
) |
Free cash flow |
|
$ |
(7,818 |
) |
|
$ |
2,701 |
|
|
$ |
(47,613 |
) |
|
$ |
90,579 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary of Stock-Based
Compensation Expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
|
$ |
45 |
|
|
$ |
61 |
|
|
$ |
216 |
|
|
$ |
249 |
|
Research and development |
|
|
253 |
|
|
|
447 |
|
|
|
1,569 |
|
|
|
1,864 |
|
Selling, general and administrative |
|
|
2,073 |
|
|
|
1,844 |
|
|
|
8,036 |
|
|
|
6,781 |
|
Total |
|
$ |
2,371 |
|
|
$ |
2,352 |
|
|
$ |
9,821 |
|
|
$ |
8,894 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary of
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales of broadband products |
|
$ |
75,004 |
|
|
$ |
24,625 |
|
|
$ |
164,458 |
|
|
$ |
133,386 |
|
Capacity expansions |
|
|
26,177 |
|
|
|
32,820 |
|
|
|
76,919 |
|
|
|
123,603 |
|
Product |
|
|
101,181 |
|
|
|
57,445 |
|
|
|
241,377 |
|
|
|
256,989 |
|
Service |
|
|
11,712 |
|
|
|
10,380 |
|
|
|
40,920 |
|
|
|
40,138 |
|
Total revenue |
|
$ |
112,893 |
|
|
$ |
67,825 |
|
|
$ |
282,297 |
|
|
$ |
297,127 |
|
CASA SYSTEMS,
INC.CONDENSED CONSOLIDATED BALANCE
SHEETS(unaudited)(in thousands)
|
|
December 31, |
|
|
December 31, |
|
|
|
2019 |
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
113,638 |
|
|
$ |
280,587 |
|
Accounts receivable, net |
|
|
93,100 |
|
|
|
81,782 |
|
Inventory |
|
|
93,604 |
|
|
|
50,997 |
|
Prepaid expenses and other current assets |
|
|
4,884 |
|
|
|
3,755 |
|
Prepaid income taxes |
|
|
3,217 |
|
|
|
390 |
|
Total current assets |
|
|
308,443 |
|
|
|
417,511 |
|
Property and equipment, net |
|
|
35,910 |
|
|
|
29,879 |
|
Accounts receivable, net of
current portion |
|
|
575 |
|
|
|
2,388 |
|
Deferred tax assets |
|
|
69 |
|
|
|
21,578 |
|
Goodwill |
|
|
50,347 |
|
|
|
— |
|
Intangible assets, net |
|
|
41,148 |
|
|
|
— |
|
Other assets |
|
|
7,820 |
|
|
|
3,293 |
|
Total assets |
|
$ |
444,312 |
|
|
$ |
474,649 |
|
Liabilities and
Stockholders’
Equity |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
25,890 |
|
|
$ |
17,776 |
|
Accrued expenses and other current liabilities |
|
|
34,567 |
|
|
|
36,992 |
|
Accrued income taxes |
|
|
— |
|
|
|
958 |
|
Deferred revenue |
|
|
25,485 |
|
|
|
31,206 |
|
Current portion of long-term debt, net of unamortized debt issuance
costs |
|
|
8,524 |
|
|
|
2,179 |
|
Total current liabilities |
|
|
94,466 |
|
|
|
89,111 |
|
Accrued income taxes, net of
current portion |
|
|
12,381 |
|
|
|
4,923 |
|
Deferred tax liabilities |
|
|
8,993 |
|
|
|
— |
|
Deferred revenue, net of current
portion |
|
|
4,583 |
|
|
|
12,479 |
|
Long-term debt, net of current
portion and unamortized debt issuance costs |
|
|
284,756 |
|
|
|
293,280 |
|
Other liabilities,
non-current |
|
|
569 |
|
|
|
— |
|
Total liabilities |
|
|
405,748 |
|
|
|
399,793 |
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
|
|
Common stock |
|
|
84 |
|
|
|
83 |
|
Treasury Stock |
|
|
(1,795 |
) |
|
|
— |
|
Additional paid-in capital |
|
|
169,561 |
|
|
|
156,939 |
|
Accumulated other comprehensive loss |
|
|
(2,222 |
) |
|
|
(1,158 |
) |
Accumulated deficit |
|
|
(127,064 |
) |
|
|
(81,008 |
) |
Total stockholders’ equity |
|
|
38,564 |
|
|
|
74,856 |
|
Total liabilities and stockholders’ equity |
|
$ |
444,312 |
|
|
$ |
474,649 |
|
CASA SYSTEMS,
INC.CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS (unaudited)(in thousands)
|
|
Year Ended
December 31, |
|
|
|
2019 |
|
|
2018 |
|
Cash flows (used in) provided by operating
activities: |
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
(48,206 |
) |
|
$ |
73,006 |
|
Adjustments to reconcile net
(loss) income to net cash (used in) provided by operating
activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
14,722 |
|
|
|
9,454 |
|
Stock-based compensation |
|
|
9,821 |
|
|
|
8,894 |
|
Deferred income taxes |
|
|
18,844 |
|
|
|
(11,517 |
) |
Increase (decrease) in provision for doubtful accounts |
|
|
560 |
|
|
|
(282 |
) |
Excess and obsolete inventory valuation adjustment |
|
|
545 |
|
|
|
(5,883 |
) |
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
1,881 |
|
|
|
34,716 |
|
Inventory |
|
|
(21,276 |
) |
|
|
(11,051 |
) |
Prepaid expenses and other assets |
|
|
(3,679 |
) |
|
|
(1,084 |
) |
Prepaid income taxes |
|
|
16 |
|
|
|
146 |
|
Accounts payable |
|
|
1,554 |
|
|
|
4,197 |
|
Accrued expenses and other current liabilities |
|
|
(7,827 |
) |
|
|
6,124 |
|
Accrued income taxes |
|
|
3,521 |
|
|
|
(3,088 |
) |
Deferred revenue |
|
|
(9,498 |
) |
|
|
(5,087 |
) |
Net cash (used in) provided by operating activities |
|
|
(39,022 |
) |
|
|
98,545 |
|
Cash flows used in
investing activities: |
|
|
|
|
|
|
|
|
Purchases of property and
equipment |
|
|
(8,591 |
) |
|
|
(7,966 |
) |
Acquisition of businesses, net of
cash acquired |
|
|
(109,431 |
) |
|
|
— |
|
Net cash used in investing activities |
|
|
(118,022 |
) |
|
|
(7,966 |
) |
Cash flows used in
financing activities: |
|
|
|
|
|
|
|
|
Principal repayments of debt |
|
|
(6,820 |
) |
|
|
(3,304 |
) |
Proceeds from exercise of stock
options |
|
|
2,687 |
|
|
|
14,730 |
|
Payments of dividends and
equitable adjustments |
|
|
(2,590 |
) |
|
|
(7,325 |
) |
Follow-on offering selling
shareholders profit disgorgement |
|
|
— |
|
|
|
3,811 |
|
Repurchases of common stock |
|
|
(1,795 |
) |
|
|
(75,102 |
) |
Payments of initial public
offering costs |
|
|
— |
|
|
|
(1,148 |
) |
Employee taxes paid related to
net share settlement of equity awards |
|
|
(1,009 |
) |
|
|
(13 |
) |
Net cash used in financing activities |
|
|
(9,527 |
) |
|
|
(68,351 |
) |
Effect of exchange rate changes
on cash and cash equivalents |
|
|
(378 |
) |
|
|
(1,442 |
) |
Net (decrease) increase
in cash, cash equivalents and restricted cash |
|
|
(166,949 |
) |
|
|
20,786 |
|
Cash, cash equivalents and
restricted cash at beginning of period |
|
|
281,606 |
|
|
|
260,820 |
|
Cash, cash equivalents and
restricted cash at end of period |
|
$ |
114,657 |
|
|
$ |
281,606 |
|
Supplemental disclosures
of cash flow information: |
|
|
|
|
|
|
|
|
Cash paid for interest |
|
$ |
18,885 |
|
|
$ |
18,348 |
|
Cash paid for income taxes |
|
$ |
4,334 |
|
|
$ |
7,268 |
|
Supplemental disclosures
of non-cash operating, investing and
financing activities: |
|
|
|
|
|
|
|
|
Purchases of property and
equipment included in accounts payable |
|
$ |
727 |
|
|
$ |
1,255 |
|
Unpaid equitable adjustments
included in accrued expenses and other current
liabilities |
|
$ |
731 |
|
|
$ |
3,336 |
|
Release of customer incentives
included in accounts receivable and accrued expenses and
other current liabilities |
|
$ |
5,735 |
|
|
$ |
8,556 |
|
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