TEL AVIV, April 30, 2008 (PRIME NEWSWIRE) -- Orckit Communications Ltd. (Nasdaq:ORCT) today reported results for the first quarter ended March 31, 2008.
Revenues in the first quarter of 2008 were $2.0 million compared to $1.8 million in the previous quarter ended December 31, 2007 and $4.5 million in the comparable quarter last year.
Net loss for the quarter ended March 31, 2008 was $7.7 million, or $(0.47) per share, compared to net income of $6.4 million, or $0.38 per diluted share, for the previous quarter ended December 31, 2007 and a net loss of $5.6 million, or $(0.36) per share, for the first quarter of 2007. Results for the previous quarter ended December 31, 2007 include one-time income of $14.2 million derived from a payment to the Company in connection with the settlement of a commercial dispute related to the Company's legacy operations.
Key Highlights for the quarter:
-- Corrigent's CM-100 and CM-4000 product lines were selected by
Media Broadcast as a main network infrastructure building block to
be deployed by Deutsche Telekom for a leading cable operator in
Germany. Deployments in Lower Saxony and Bavaria in Germany begin
this year, and rollouts in additional regions for the leading
cable operator are expected to occur over the next several years.
First shipments of CM products in Germany have commenced.
-- Carriers in Asia and the U.S. continued their evaluation of the
CM product line to support their deployment plans, with commercial
selections expected in 2008.
-- Corrigent participated in a panel at the OFC/NFOEC 2008
conference, together with representatives from U.S. telecom
carriers Verizon and AT&T. The panel reviewed alternative
strategies for the migration of carriers from TDM to packet
networks. Corrigent presented its approach with respect to
delivering converged TDM and packet services over Ethernet
transport networks and the interworking mechanisms to facilitate
this migration.
-- Corrigent participated in the Fiber Optics Expo 2008 tradeshow in
Tokyo, Japan and presented its approach with respect to scaling
network-side interfaces in-service to up to 100Gbps, in 10Gbps
increments.
Izhak Tamir, President of Orckit, commented: "Product deliveries to Media Broadcast have begun and are expected to ramp up as the year progresses, and the initial deployments for the two networks in Germany proceed. We believe that this win increases the confidence that carriers have in our product maturity and technology leadership, and positions us favorably in the eyes of carriers as we work to transform trials and evaluations into commercial selections.
"Telecom carriers continue to evaluate optimized platforms to support the convergence of voice, video and data services over packet networks. These advanced services, including high-definition, on-demand and mobile video, as well as next-generation wireless technology such as WiMAX, are expected to drive the demand for the CM product families going forward. We believe that additional carriers will recognize the benefits of the CM product line and make our platform the solution of choice for these applications."
Outlook and Guidance
For the quarter ending June 30, 2008, we expect revenues to be approximately $3.0 million, with a net loss of approximately $8.5 million, or approximately $(0.52) per share. This guidance does not take into account financial income or loss due to valuation of conversion terms included in our $25.8 million principal amount of convertible subordinated notes that were issued in March 2007. Such income or loss is subject to certain factors, including our share price, and cannot be estimated at this time.
Conference Call
Orckit Communications will host a conference call on April 30, 2008, at 11 a.m. EST. The call can be accessed by dialing 1- 888-459-5609 in the United States and 1- 973-321-1024 internationally. A replay of the call will be available at http://www.orckit.com. A replay of the call will be also available through May 7, 2008 at 11:59 p.m. at 1-800-642-1687 in the United States and 1-706-645-9291 internationally. To access this replay, enter the following code: 41742717.
About Orckit Communications
Orckit Communications Ltd. is a leading provider of advanced telecom equipment targeting high capacity broadband services. Our products include Corrigent's CM product line of metro optical transport solutions, based on RPR and MPLS technologies, delivering packet transmission services in the metro area. For more information on Orckit see www.orckit.com
Certain matters discussed in this news release are forward-looking statements that involve a number of risks and uncertainties including, but not limited to, risks in product development plans and schedules, rapid technological change, changes and delays in product approval and introduction, customer acceptance of new products, the impact of competitive products and pricing, market acceptance, the lengthy sales cycle, exchange rate fluctuations, fluctuation in order size, proprietary rights of the Company and its competitors, need for additional financing, the ability to repay the convertible notes, risk of operations in Israel, government regulation, dependence on third parties to manufacture products, general economic conditions and other risk factors detailed in the Company's United States Securities and Exchange Commission filings. Orckit assumes no obligation to update the information in this release.
ORCKIT COMMUNICATIONS LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three Months Ended
March 31
2008 2007
-------- --------
Revenues $ 1,992 $ 4,526
Cost of revenues 990 2,044
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Gross profit 1,002 2,482
Research and development expenses, net 5,816 4,974
Selling, marketing general and
administrative expenses 4,481 4,011
-------- --------
Total operating expenses 10,297 8,985
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Operating loss (9,295) (6,503)
Financial income, net 1,136 890
Adjustments due to convertible notes
conversion terms 419 0
-------- --------
Total financial income, net 1,555 890
-------- --------
Net loss $ (7,740) $ (5,613)
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Net loss per share - basic $ (0.47) $ (0.36)
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Net loss per share - diluted $ (0.47) $ (0.36)
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Weighted average number of shares
outstanding - basic 16,362 15,709
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Weighted average number of shares
outstanding - diluted 16,362 15,709
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ORCKIT COMMUNICATIONS LTD.
CONSOLIDATED BALANCE SHEETS
(US$ in thousands)
March 31 December 31
2008 2007
--------- ---------
ASSETS
Current assets:
Cash and short term marketable securities $ 73,941 $ 68,225
Trade receivables 132 49
Other receivables 2,031 1,632
Inventories 1,286 1,347
--------- ---------
Total current assets 77,390 71,253
Long term marketable securities 22,276 34,142
Severance pay fund 3,874 3,454
Property and equipment, net 1,258 1,384
Deferred issuance costs, net 735 781
--------- ---------
Total assets $ 105,533 $ 111,014
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LIABILITIES AND
SHAREHOLDERS' EQUITY
Current liabilities:
Trade payables $ 4,022 $ 4,292
Accrued expenses and other payables 7,888 8,240
Deferred income 880 1,045
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Total current liabilities 12,790 13,577
Long term liabilities:
Principal amount of convertible
subordinated notes 31,214 28,723
Adjustments due to convertible
notes conversion terms (4,132) (3,247)
--------- ---------
Convertible subordinated notes, net 27,082 25,476
Accrued severance pay and other 4,997 4,553
--------- ---------
32,079 30,029
Total liabilities 44,869 43,606
Shareholders' equity 60,664 67,408
--------- ---------
Total liabilities and shareholders' equity $ 105,533 $ 111,014
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