TEL AVIV, Israel, Aug. 15 /PRNewswire-FirstCall/ -- Orckit Communications Ltd. (NASDAQ:ORCT) today reported results for the second quarter and six months ended June 30, 2007.
Revenues in the second quarter of 2007 were $1.9 million compared to $14.7 million in the quarter ended June 30, 2006 and $4.5 million in the previous quarter ended March 31, 2007.
Net loss for the quarter ended June 30, 2007 was $6.4 million, or $(0.40) per share, compared to net income of $294,000, or $0.02 per diluted share, for the quarter ended June 30, 2006 and a net loss of $5.6 million, or $(0.36) per share, for the previous quarter ended March 31, 2007. Results for the quarter ended June 30, 2007 included financial income of $1.6 million resulting from adjustments due to the conversion terms of our convertible notes that were issued in March 2007.
Revenues for the six months ended June 30, 2007 were $6.4 million compared to $39.7 million for the six months ended June 30, 2006. Net loss for the six months ended June 30, 2007 was $12.0 million, or $(0.76) per share, compared to net income of $6.1 million, or $0.36 per diluted share, for the six months ended June 30, 2006.
Izhak Tamir, President of Orckit, commented, "This quarter we maintained our R&D efforts to enhance the capabilities of the CM-4000, our high capacity Packet Transport Switch. We remain on track to begin customer evaluations of the CM-4000 in late 2007, with commercial availability expected in early 2008. As recognition of the need for ultra-wide bandwidth converged metro architecture grows within the telecom industry, we continue to see increasing interest from telecom carriers in the CM-4000. This interest is driven by the emergence of high capacity video transmissions services." Mr. Tamir added, "The CM-4000 complements our CM-100 platform, broadening and enhancing our product line, and allowing telecom carriers to provide bandwidth-intensive services such as High-Definition IPTV and TDM-based 3.5G wireless video services, as well as other video applications, in a converging transport environment." Mr. Tamir concluded, "In 2008, we expect to see additional evaluation and product selection processes by leading telecom carriers for both cellular and fixed line networks. We expect to begin shipping the CM-4000 product line in 2008 and are encouraged by the opportunities this line is expected to generate for us going forward." Outlook and Guidance For the quarter ending September 30, 2007, we expect revenues to be approximately $1.5 million, net loss to be approximately $8.4 million and net loss per share to be approximately $(0.53). This guidance does not take into account income or losses 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 losses are subject to certain factors, including our share price, and cannot be estimated.
Conference Call Orckit Communications will host a conference call on August 15, 2007, at 11 a.m. EST. The call can be accessed by dialing 1-888-200-4690 in the United States and 1-973-935-8767 internationally. A replay of the call will be available at http://www.orckit.com/. A replay of the call will be also available through August 22, 2007 at 11:59 p.m. at 1-877-519-4471 in the United States and 1-973-341-3080 internationally. To access this replay, enter the following code: 8987354.
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 http://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 Six months Ended
June 30 June 30
2007 2006 2007 2006 Revenues $1,900 $14,706 $6,426 $39,665 Cost of revenues 978 7,357 3,022 19,385
------ ------- ------ ------- Gross profit 922 7,349 3,404 20,280 Research and
development
expenses, net 4,897 3,982 9,871 8,222 Selling, marketing
general and
administrative
expenses 4,094 3,662 8,105 7,565
------ ------- ------ ------- Total operating
expenses 8,991 7,644 17,976 15,787
------ ------- ------ ------- Operating income
(loss) (8,069) (295) (14,572) 4,493 Financial income, net 97 589 987 1,621
Adjustments due to
convertible notes
conversion terms 1,609 0 1,609 0
Total financial
income, net 1,706 589 2,596 1,621
------ ------- ------ ------- Net income (loss) $(6,363) $294 $(11,976) $6,114
======= ======= ======== ======= Net income (loss)
per share - basic $(0.40) $0.02 $(0.76) $0.40
======= ======= ======== ======= Net income (loss)
per share - diluted $(0.40) $0.02 $(0.76) $0.36 ======= ======= ======== =======
Weighted average
number of shares
outstanding - basic 15,776 15,513 15,742 15,218
======= ======= ======== ======= Weighted average
number of shares
outstanding - diluted 15,776 16,685 15,742 17,020
======= ======= ======== =======
ORCKIT COMMUNICATIONS LTD. CONSOLIDATED BALANCE SHEETS
(US$ in thousands) June 30 December 31
2007 2006
ASSETS
Current assets:
Cash and short term marketable securities $60,808 $46,011
Restricted cash 25,885 0
Trade receivables 344 1,581
Other receivables 1,915 2,077
Inventories 1,996 3,464
------- -------
Total current assets 90,948 53,133 Long term marketable securities 33,166 40,561
Severance pay fund 3,147 3,173
Property and equipment, net 1,839 2,490
Deferred issuance costs, net 858 0
------- -------
Total assets $129,958 $99,357
======== ======= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities:
Bank loans $20,796 $0
Trade payables 4,687 4,907
Accrued expenses and other payables 8,559 10,134
Deferred income 1,830 3,196
------- -------
Total current liabilities 35,872 18,237 Long term liabilities:
Convertible subordinated notes 25,328 0
Adjustments due to convertible
notes conversion terms (1,609) 0
------- -------
Convertible subordinated notes, net 23,719 0 Accrued severance pay and other 4,559 4,257
------- -------
28,278 4,257 Total liabilities 64,150 22,494 Shareholders' equity 65,808 76,863
------- ------- Total liabilities and shareholders' equity $129,958 $99,357
======== ======= Contacts:
Jeffrey Corbin / Lee Roth/ (Investor Relations)
KCSA Worldwide
(212) 896-1214/(212) 896-1209
/ DATASOURCE: Orckit Communications Ltd.
CONTACT: Jeffrey Corbin, +1-212-896-1214, , or Investor Relations, Lee Roth, +1-212-896-1209, of KCSA Worldwide, for Orckit Communications Ltd. Web site: http://www.orckit.com/
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