MILPITAS, Calif., Nov. 2 /PRNewswire-FirstCall/ -- JDSU (Nasdaq:
JDSUD; TSX: JDU) today reported results for its fiscal 2007 first
quarter ended September 30, 2006. Following the execution of a
1-for-8 reverse stock split on October 16, 2006, all earnings per
share calculations are presented on a split-adjusted basis. Net
revenue for the first quarter was $318.1 million and GAAP net loss
was $(17.4) million, or $(0.08) per share. This compares to net
revenue of $318.2 million and GAAP net loss of $(45.8) million, or
$(0.22) per share, reported for the fourth quarter of fiscal 2006,
and to net revenue of $258.3 million and a GAAP net loss of $(67.0)
million, or $(0.34) per share, for the first quarter of fiscal
2006. Fiscal 2006 first quarter results reflect a partial quarter
contribution from the Communications Test and Measurement business
acquired in August 2005. On a non-GAAP basis, revenue for the first
quarter was $318.2 million and net income was $6.8 million, or
$0.03 per share. This compares to non-GAAP net revenue of $318.6
million and a non-GAAP net loss of $(2.1) million, or $(0.01) per
share, for the fourth quarter of fiscal 2006, and to non-GAAP net
revenue of $259.2 million and a non-GAAP net loss of $(15.4)
million, or $(0.08) per share, for the first quarter of fiscal
2006. On a non-GAAP EBITDA basis (non-GAAP Earnings Before
Interest, Taxes, Depreciation and Amortization), the Company earned
$9.6 million for the quarter ended September 30, 2006, which
compares to $5.5 million for the fourth quarter of fiscal 2006, and
to a loss of $(4.3) million for the first quarter of fiscal 2006.
"The achievement of positive earnings per share on a non-GAAP basis
for the first time in more than five years marks another
significant milestone on the company's journey to sustained
profitability," said Kevin Kennedy, JDSU's Chief Executive Officer.
"Our strong balance sheet, coupled with a firm commitment to
innovation, ensures that JDSU will continue to enable the delivery
of next generation optical and broadband service technologies."
Financial Overview - Fiscal 2007 First Quarter Ended September 30,
2006 -- Optical Communications net revenue grew 3.8% from the
previous quarter, and 37.3% from the same quarter a year ago. Net
revenue of $138.0 million represented 43% of total net revenue. --
Communications Test and Measurement net revenue of $116.8 million
was down 7.5% from last quarter and represented 37% of total net
revenue. -- Advanced Optical Technologies net revenue of $39.3
million was up 7.1% from last quarter, and down 10.9% 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 revenue of $24.1 million, up
6.6% sequentially and 25.5% from the same quarter a year ago,
representing 8% of total net revenue. -- Americas' customers
represented 56.9% of net revenue. European and Asia-Pacific
customers represented 25.6% and 17.5% of net revenue, respectively.
-- GAAP gross margin was 30.8% of net revenue, and non-GAAP gross
margin was 34.7% of net revenue. -- GAAP operating expenses were
$134.7 million, or 42.4% of net revenue. Non-GAAP operating
expenses were $117.3 million, or 36.9% of net revenue. -- The
Company held $1,216.0 million in cash, cash equivalents, short-term
investments and restricted cash at the end of the first quarter.
Business Outlook For the second quarter of fiscal 2007, ending
December 31, 2006, the Company expects net revenue of $332 to $352
million. Conference Call The Company will discuss these results and
other related matters at 2:30 p.m. Pacific Time on November 2, 2006
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 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/. Following
the completion of a 1-for-8 reverse stock split on October 16,
2006, JDSU's common stock is trading under the temporary trading
symbol "JDSUD." The trading symbol will revert back to "JDSU" on
November 14, 2006. 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 Communications and
Commercial and Consumer product portfolio; (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 a significant level of in-quarter book-and-ship
business, further limiting our forecasting abilities; and (g) we
are currently engaged in various product and manufacturing
transfers, site consolidations and product discontinuances. 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 Annual Report on Form 10-K for the year ended June
30, 2006 filed with the Securities and Exchange Commission, as well
as in other filings on Forms 10-Q. 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.
-SELECTED FINANCIAL DATA FOLLOWS- JDS UNIPHASE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in millions,
except per share data) (unaudited) Three Months Ended September 30,
September 30, 2006 2005 Net revenue $318.1 $258.3 Cost of sales
210.2 206.7 Amortization of acquired developed technologies 9.9 7.6
Gross profit 98.0 44.0 Operating expenses: Research and development
40.0 33.7 Selling, general and administrative 83.0 70.4
Amortization of other intangibles 6.4 4.7 Acquired in-process
research and development -- 19.6 Reduction of intangibles and loss
on long-lived assets 0.1 6.0 Restructuring charges 5.2 4.8 Total
operating expenses 134.7 139.2 Loss from operations (36.7) (95.2)
Interest and other, net 17.8 3.1 Gain on sale of investments 0.3
33.3 Reduction in fair value of investments -- (2.3) Income (loss)
on equity method investments 0.1 (0.4) Loss before income taxes
(18.5) (61.5) Provision of (benefit for) income taxes (1.1) 5.5 Net
loss $(17.4) $(67.0) Net loss per share - basic and diluted $(0.08)
$(0.34) Shares used in per share calculation - basic and diluted
210.9 197.6 Note: Shares used in per share calculation for basic
and diluted reflect a 1-for-8 reverse stock split effected by the
Company on October 16, 2006. JDS UNIPHASE CORPORATION CONDENSED
CONSOLIDATED BALANCE SHEETS (in millions, unaudited) September 30,
June 30, 2006 2006 ASSETS Current assets: Cash and cash equivalents
$269.9 $364.9 Short-term investments 931.2 857.3 Restricted cash
14.9 16.4 Accounts receivable, net 231.0 232.3 Inventories, net
222.8 202.2 Refundable income taxes 14.2 23.9 Other current assets
113.7 108.0 Total current assets 1,797.7 1,805.0 Property, plant
and equipment, net 203.7 201.2 Deferred income taxes 3.5 2.3
Goodwill 660.5 656.7 Other intangibles, net 349.1 362.0 Long-term
investments 10.9 10.8 Other non-current assets 27.1 27.1 Total
assets $3,052.5 $3,065.1 LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities: Accounts payable $123.2 $126.6 Accrued payroll
and related expenses 54.1 60.6 Income taxes payable 80.0 81.2
Deferred income taxes 1.3 -- Restructuring accrual 17.0 19.8
Warranty accrual 10.1 11.5 Other current liabilities 120.7 122.7
Total current liabilities 406.4 422.4 Long-term debt 900.0 900.0
Other non-current liabilities 159.6 159.1 Stockholders' equity:
Total stockholders' equity 1,586.5 1,583.6 Total liabilities and
stockholders' equity $3,052.5 $3,065.1 JDS UNIPHASE CORPORATION
REPORTABLE SEGMENT INFORMATION (in millions, unaudited) Three
Months Ended September 30, September 30, 2006 2005 Net revenue:
Optical Communications $138.0 $100.5 Communications Test and
Measurement 116.8 95.4 Advanced Optical Technologies 39.3 44.1 All
Other, Commercial Lasers 24.1 19.2 Deferred revenue related to
purchase accounting adjustment (0.1) (0.9) Net revenue $318.1
$258.3 Operating income (loss): Optical Communications $2.2 $(16.7)
Communications Test and Measurement 6.8 19.6 Advanced Optical
Technologies 11.0 9.8 All Other, Commercial Lasers 1.7 0.1
Corporate (28.7) (29.7) Total segment operating income (loss) (7.0)
(16.9) Unallocated amounts: Stock based compensation (6.6) (3.2)
Acquisition-related charges and amortization of intangibles (17.1)
(61.9) Reduction of other long-lived assets (0.1) (6.0)
Restructuring charges (5.2) (4.8) Other realignment charges (0.7)
(2.4) Interest and other, net 17.8 3.1 Gain on sale of investments
0.3 33.3 Reduction in fair value of investments -- (2.3) Gain
(loss) on equity method investments 0.1 (0.4) Loss before income
taxes $(18.5) $(61.5) Use of Non-GAAP Financial Measures The
Company provides non-GAAP gross margin, non-GAAP operating expense,
non-GAAP net loss, non-GAAP net loss per share and non-GAAP 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 gross margin, non-GAAP operating expenses, non-GAAP net
loss, non-GAAP net loss per share and non-GAAP 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 loss, non-GAAP net loss per share and
non-GAAP 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 loss, non-GAAP net loss per share and non-GAAP 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
loss, non-GAAP net loss per share and non-GAAP 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 operating
expense, related to the various acquisitions it has made.
Management excludes these items, for the purposes of calculating
non-GAAP operating expense, non- GAAP net loss, non-GAAP net loss
per share and non-GAAP 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 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 operating
expense, non-GAAP net loss, non- GAAP net loss per share and
non-GAAP 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 non-GAAP EBITDA excludes
items as a result of interest, taxes, depreciation and
amortization. Management believes non-GAAP 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 operating
expense, non-GAAP net loss, non- GAAP net loss per share and
non-GAAP 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 gross margin is
gross margin. The GAAP measure most directly comparable to non-GAAP
operating expense is operating expense. The GAAP measure most
directly comparable to non-GAAP net loss is net loss. The GAAP
measure most directly comparable to non-GAAP net loss per share is
net loss per share. The GAAP measure most directly comparable to
non-GAAP EBITDA is loss from operations. The Company believes that
these GAAP measures alone are not indicative of its core operating
expenses and performance. The following table reconciles the
non-GAAP gross margin, operating expense, net loss, net loss per
share, and EBITDA financial measures to GAAP (in millions, except
per share amounts): Three Months Ended September 30, 2006 Net Gross
Operating Income EBITDA Profit Expense (Loss) Non-GAAP $110.3
$117.3 $6.8 $9.6 Costs related to restructuring events (0.8) 5.1
(5.9) (5.9) Cost of goods sold related to acquisition activities
(0.8) -- (0.8) (0.8) Costs related to stock based compensation
expense (0.8) 5.8 (6.6) (6.6) Amortization of acquired developed
technologies & acquisition intangibles (9.9) 6.4 (16.3) --
Reduction in intangibles and other long lived assets -- 0.1 (0.1)
(0.1) Acquired in-process R&D -- -- -- -- Interest and other
income -- -- 5.1 -- Gain, loss, or redution in fair value of
investments -- -- 0.4 -- Income tax expense -- -- -- -- GAAP $98.0
$134.7 $(17.4) $(3.8) Non-GAAP income (loss) per share, basic and
diluted $0.03 GAAP loss per share $(0.08) Shares used in per-share
calculation - basic 210.9 Shares used in per-share calculation -
diluted 223.4 Three Months Ended September 30, 2005 Gross Operating
Net EBITDA Profit Expense Loss Non-GAAP $82.0 $98.9 $(15.4) $(4.3)
Costs related to restructuring events -- 7.2 (7.2) (7.2) Cost of
goods sold related to acquisition activities (30.0) -- (30.0)
(30.0) Costs related to stock based compensation expense (0.4) 2.8
(3.2) (3.2) Amortization of acquired developed technologies &
acquisition intangibles (7.6) 4.7 (12.3) -- Reduction in
intangibles and other long lived assets -- 6.0 (6.0) (6.0) Acquired
in-process R&D -- 19.6 (19.6) (19.6) Interest and other income
-- -- (0.3) -- Gain, loss, or reduction in fair value of
investments -- -- 30.6 -- Income tax expense -- -- (3.6) -- GAAP
$44.0 $139.2 $(67.0) $(70.3) Non-GAAP income (loss) per share,
basic and diluted $(0.08) GAAP loss per share $(0.34) Shares used
in per-share calculation - basic 197.6 Shares used in per-share
calculation - diluted 197.6
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/
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