TEL AVIV, Israel, Nov. 6 /PRNewswire-FirstCall/ -- Orckit Communications Ltd. (NASDAQ:ORCT) today reported results for the third quarter and nine months ended September 30, 2007.
Revenues in the third quarter of 2007 were $1.7 million compared to $1.9 million in the previous quarter ended June 30, 2007 and $15.0 million in the comparable quarter last year.
Net loss for the quarter ended September 30, 2007 was $6.5 million, or $(0.41) per share, compared to a net loss of $6.4 million, or $(0.40) per share, for the previous quarter ended June 30, 2007 and net income of $985,000, or $0.06 per diluted share, for the comparable quarter last year. Results for the quarters ended September 30, 2007 and June 30, 2007 included financial income of $936,000 and $1.6 million, respectively, which resulted from adjustments due to the conversion terms of the Company's convertible notes issued in March 2007. There was no such financial income in the comparable quarter last year.
Revenues for the nine months ended September 30, 2007 were $8.1 million compared to $54.6 million for the nine months ended September 30, 2006. Net loss for the nine months ended September 30, 2007 was $18.5 million, or $(1.17) per share, compared to net income of $7.1 million, or $0.42 per diluted share, for the nine months ended September 30, 2006. Results for the nine months ended September 30, 2007 included financial income of $2.5 million which resulted from adjustments due to the conversion terms of the Company's convertible notes issued in March 2007. There was no such financial income in the comparable period last year.
Izhak Tamir, President of Orckit, commented, "We believe that 2007 has become an inflection point for Fiber To The Home (FTTH) deployment in the last mile, as it continues to gain momentum with large-scale deployments by first tier telecom service providers in the Far-East and in the U.S. Our metro solution, the CM-4000 Packet Transport Switch, offers carriers an optimal solution for providing high-end high-capacity video services and applications based on High-Definition IPTV.
Mr. Tamir added, "We continue to experience interest in the CM-4000 from carriers to complement high bandwidth local loop deployments with an ultra- high-bandwidth metro platform to meet network requirements for this new era. Evaluations of the CM-4000 are on track and we expect selections for commercial deliveries in 2008." He concluded, "We are excited about the opportunities that lie ahead, and are encouraged by the potential that exists for our technology and product line as demand for high capacity bandwidth continues to grow. We believe that current evaluations could lead to commercial deployments with first tier carriers world-wide, as our solutions and technology gain further recognition." Outlook and Guidance For the quarter ending December 31, 2007, we expect revenues to be approximately $1.7 million, with net income of approximately $6.3 million and net income per diluted share of approximately $0.37. The expected net income in the quarter ending December 31, 2007, compared to the net losses we have reported in the first three quarters of 2007, results from one-time income of approximately $14.2 million derived from the settlement of a commercial dispute addressing legacy operations that was announced earlier this quarter. 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. In the quarter ended September 30, 2007, we recognized $936,000 of financial income as a result of adjustments due to these conversion terms.
Conference Call Orckit Communications will host a conference call on November 6, 2007, 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 November 13, 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: 9282264.
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.
Contacts:
Lee Roth/ (Investor Relations)
KCSA Worldwide
(212) 896-1209
TABLES TO FOLLOW ORCKIT COMMUNICATIONS LTD. CONSOLIDATED STATEMENTS OF OPERATIONS
(US$ in thousands, except per share data) Three Months Ended Nine Months Ended
September 30 September 30
2007 2006 2007 2006
Revenues $ 1,694 $ 14,961 $ 8,120 $ 54,626 Cost of revenues 889 6,933 3,911 26,318
______ ______ ______ ______
Gross profit 805 8,028 4,209 28,308 Research and
development
expenses, net 4,969 3,640 14,840 11,862 Selling, marketing
general and
administrative
expenses 4,387 4,236 12,492 11,801
______ ______ ______ ______
Total
operating
expenses 9,356 7,876 27,332 23,663
______ ______ ______ ______
Operating
income (loss) (8,551) 152 (23,123) 4,645 Financial
income, net 1,130 833 2,117 2,454
Adjustments
due to convertible
notes conversion
terms 936 0 2,545 0
Total financial
income, net 2,066 833 4,662 2,454
______ ______ ______ ______
Net income
(loss) $ (6,485) $ 985 $(18,461) $ 7,099
====== ====== ====== ======
Net income
(loss) per
share - basic $ (0.41) $ 0.06 $ (1.17) $ 0.46
====== ====== ====== ======
Net income
(loss) per
share
- diluted $ (0.41) $ 0.06 $ (1.17) $ 0.42
====== ====== ====== ======
Weighted
average number
of shares
outstanding
- basic 15,845 15,588 15,777 15,343
====== ====== ====== ======
Weighted
average number
of shares
outstanding
- diluted 15,845 16,282 15,777 16,775
====== ====== ====== ====== ORCKIT COMMUNICATIONS LTD. CONSOLIDATED BALANCE SHEETS
(US$ in thousands) September 30 December 31
2007 2006
Current assets:
Cash and short term
marketable securities $ 58,996 $ 46,011
Trade receivables 122 1,581
Other receivables 3,174 2,077
Inventories 1,496 3,464
______ ______
Total current assets 63,788 53,133 Long term marketable securities 34,673 40,561
Severance pay fund 3,308 3,173
Property and equipment, net 1,572 2,490
Deferred issuance costs, net 827 0
______ ______
Total assets $104,168 $ 99,357
====== ======
LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Trade payables $ 3,973 $ 4,907
Accrued expenses and
other payables 9,905 10,134
Deferred income 1,327 3,196
______ ______
Total current liabilities 15,205 18,237 Long term liabilities: Convertible subordinated notes 27,528 0
Adjustments due to convertible
notes conversion terms (2,983) 0
Convertible subordinated
notes, net 24,545 0 Accrued severance pay and other 4,934 4,257
______ ______
Total long term liabilities 29,479 4,257 Total liabilities 44,684 22,494 Shareholders' equity 59,484 76,863
______ ______
Total liabilities and
shareholders' equity $104,168 $99,357
====== ======
DATASOURCE: Orckit Communications Ltd.
CONTACT: Investors, Lee Roth of KCSA Worldwide, +1-212-896-1209, , for Orckit Web site: http://www.orckit.com/
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