ADTRAN, Inc. Reports Results for the First Quarter 2013 and Declares Quarterly Cash Dividend

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ADTRAN, Inc. Reports Results for the First Quarter 2013 and Declares Quarterly Cash Dividend

HUNTSVILLE, Ala.--(BUSINESS WIRE)-- ADTRAN, Inc. (NASDAQ:ADTN) reported results for the first quarter 2013. For the quarter, sales were $143,013,000 compared to $134,735,000 for the first quarter of 2012. Net income was $7,890,000 for the quarter compared to $12,960,000 for the first quarter of 2012. Earnings per share, assuming dilution, were $0.13 for the quarter compared to $0.20 for the first quarter of 2012. Non-GAAP earnings per share for the quarter were $0.17 compared to $0.25 for the first quarter of 2012. The reconciliation between GAAP earnings per share, diluted, and non-GAAP earnings per share, diluted, is in the table provided.

ADTRAN Chief Executive Officer Tom Stanton stated, "Operating results for the quarter came in as expected with our domestic carrier business continuing to solidify and our overall revenue positively impacted by sequential growth internationally and in our Enterprise business. We believe our company is well positioned for an improving spending environment in our markets and strategic investments by our carrier customers."


The Company also announced that its Board of Directors declared a cash dividend for the first quarter of 2013. The quarterly cash dividend is $0.09 per common share to be paid to holders of record at the close of business on April 25, 2013. The ex-dividend date is April 23, 2013 and the payment date is May 9, 2013.

Non-GAAP earnings per share exclude the effect of acquisition related expenses, amortizations and adjustments, and stock compensation expense.

The Company confirmed that its first quarter conference call will be held Wednesday, April 10, 2013 at 9:30 a.m. Central Time. This conference call will be web cast live through StreetEvents.com. To listen, simply visit the Investor Relations site at http://www.adtran.comor http://www.streetevents.com approximately 10 minutes prior to the start of the call and click on the conference call link provided.

An online replay of the conference call will be available for seven days at http://www.streetevents.com. In addition, an online replay of the conference call, as well as the text of the Company's earnings release, will be available on the Investor Relations site at http://www.adtran.com for at least 12 months following the call.

ADTRAN, Inc. is a leading global provider of networking and communications equipment. ADTRAN's products enable voice, data, video and Internet communications across a variety of network infrastructures. ADTRAN solutions are currently in use by service providers, private enterprises, government organizations, and millions of individual users worldwide. For more information, please visit www.adtran.com.

For more information, contact the company at 800 9ADTRAN (800 923-8726) or via email at info@adtran.com. On the Web, visit www.adtran.com.

This press release contains forward-looking statements which reflect management's best judgment based on factors currently known. However, these statements involve risks and uncertainties, including the successful development and market acceptance of new products, the degree of competition in the market for such products, the product and channel mix, component costs, manufacturing efficiencies, and other risks detailed in our annual report on Form 10-K for the year ended December 31, 2012. These risks and uncertainties could cause actual results to differ materially from those in the forward-looking statements included in this press release.

 
 
 

Condensed Consolidated Balance Sheet
(Unaudited)
(In thousands)

 
 March 31,
2013
 December 31,
2012
Assets
Cash and cash equivalents$58,640$68,457
Short-term investments189,236160,481
Accounts receivable, net82,10281,194
Other receivables16,16416,253
Inventory95,767102,583
Prepaid expenses4,4194,148
Deferred tax assets, net 12,972 13,055
Total Current Assets459,300446,171
 
Property, plant and equipment, net77,78180,246
Deferred tax assets, net10,68010,261
Goodwill3,4923,492
Other assets12,59913,482
Long-term investments 310,484 332,729
 
Total Assets$874,336$886,381
 
Liabilities and Stockholders' Equity
Accounts payable$48,933$42,173
Unearned revenue33,56338,051
Accrued expenses11,11710,309
Accrued wages and benefits16,47915,022
Income tax payable, net 1,585 1,211
Total Current Liabilities111,677106,766
 
Non-current unearned revenue24,99023,803
Other non-current liabilities18,54117,406
Bonds payable 46,000 46,000
Total Liabilities201,208193,975
 
Stockholders' Equity 673,128 692,406
 
Total Liabilities and Stockholders' Equity$874,336$886,381

 
 
 

Consolidated Statements of Income
(Unaudited)
(In thousands, except per share data)

 
  Three Months Ended
March 31,
2013 2012
 
Sales$143,013$134,735
Cost of sales 73,336  60,648 
 
Gross Profit69,67774,087
 
Selling, general and administrative expenses30,60333,111
Research and development expenses 32,511  24,795 
 
Operating Income6,56316,181
 
Interest and dividend income1,7681,861
Interest expense(581)(588)
Net realized investment gain3,6452,467
Other income (expense), net (1,672) 141 
 
Income before provision for income taxes9,72320,062
 
Provision for income taxes (1,833) (7,102)
 
Net Income$7,890 $12,960 
 
Weighted average shares outstanding - basic61,84763,809
Weighted average shares outstanding - diluted (1)62,03064,849
 
Earnings per common share - basic$0.13$0.20
Earnings per common share - diluted (1)$0.13$0.20
 
(1) Assumes exercise of dilutive stock options calculated under the treasury stock method.

 
 
 

Consolidated Statements of Comprehensive Income
(Unaudited)
(In thousands)

 
 Three Months Ended
March 31,
2013 2012
 
Net Income$7,890 $12,960
 
Other Comprehensive Income (Loss), net of tax:
 
Unrealized gains (losses) on available-for-sale securities(1,644)6,757
Foreign currency translation 323  153
 
Other Comprehensive Income (Loss), net of tax (1,321) 6,910
 
Comprehensive Income, net of tax$6,569 $19,870

 
 
 

Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)

 
 Three Months Ended
March 31,
2013   2012
Cash flows from operating activities:
Net income$7,890$12,960
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization3,6633,095
Amortization of net premium on available-for-sale investments1,7542,171
Net realized gain on long-term investments(3,645)(2,467)
Net (gain) loss on disposal of property, plant and equipment17(214)
Stock-based compensation expense2,2322,221
Deferred income taxes715(2,030)
Tax benefit from stock option exercises-1,492
Excess tax benefits from stock-based compensation arrangements-(1,153)
Change in operating assets and liabilities:
Accounts receivable, net(1,306)1,334
Other receivables(224)1,706
Inventory6,540(8,005)
Prepaid expenses and other assets(217)(710)
Accounts payable7,2621,831
Accrued expenses and other liabilities1,1885,287
Income tax payable, net 379  7,017 
Net cash provided by operating activities26,24824,535
 
Cash flows from investing activities:
Purchases of property, plant and equipment(735)(4,086)
Proceeds from disposals of property, plant and equipment-266
Proceeds from sales and maturities of available-for-sale investments118,13369,364
Purchases of available-for-sale investments (125,411) (95,646)
Net cash used in investing activities(8,013)(30,102)
 
Cash flows from financing activities:
Proceeds from stock option exercises553,560
Purchases of treasury stock(22,546)-
Dividend payments(5,586)(5,739)
Excess tax benefits from stock-based compensation arrangements -  1,153 
Net cash used in financing activities(28,077)(1,026)
 
Net decrease in cash and cash equivalents(9,842)(6,593)
Effect of exchange rate changes25153
Cash and cash equivalents, beginning of period 68,457  42,979 
 
Cash and cash equivalents, end of period$58,640 $36,539 
 
 

Supplemental Information
Acquisition Related Expenses, Amortizations and Adjustments
(Unaudited)
(In thousands)

On August 4, 2011, we closed on the acquisition of Bluesocket, Inc. and on May 4, 2012, we closed on the acquisition of the Nokia Siemens Networks Broadband Access business (NSN BBA). Acquisition related expenses, amortizations and adjustments for the three months ended March 31, 2013 and 2012 for both transactions are as follows:

 Three Months Ended
March 31,
2013 2012
Bluesocket, Inc. acquisition

Amortization of acquired intangible assets and other purchase accounting adjustments

$293$484
 
NSN BBA acquisition
Amortization of acquired intangible assets294-
Amortization of other purchase accounting adjustments410-
Acquisition related professional fees, travel and other expenses 154  1,580 
 
Subtotal 858  1,580 
 
Total acquisition related expenses, amortizations and adjustments1,1512,064
Tax effect (380) (803)
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