CERAGON NETWORKS REPORTS FIRST QUARTER 2011 FINANCIAL RESULTS
May 16, 2011
Achieves record revenues of $100.3 million; Results also reflect restructuring charges, transaction costs and other expenses in connection with the rapid integration of Nera Networks
Paramus, New Jersey, May 16, 2011 – Ceragon Networks Ltd. (NASDAQ: CRNT), the premier wireless backhaul specialist today reported results for the first quarter which ended March 31, 2011.
Revenues for the first quarter of 2011, the first quarter of combined revenues following the acquisition of Nera Networks, reached $100.3 million, up 68% from $59.7 million for the first quarter of 2010, and up 50% from $67.0 million in the fourth quarter of 2010.
Net loss in accordance with US Generally Accepted Accounting Principles (GAAP) for the first quarter of 2011 was $21.4 million or $(0.60) per basic share and diluted share, compared to net income of $3.0 million in the first quarter of 2010, or $0.09 per basic and $0.08 per diluted share.
On a non-GAAP basis, net loss for the first quarter, excluding (a) $1.4 million of equity-based compensation expenses, and (b)$17.1 million charges related to the Nera acquisition and integration plan, was $857,000, or $(0.02) per basic share and diluted share. Non-GAAP net income for the first quarter of 2010 was $4.0 million, or $0.12 per basic share and $0.11 per diluted share (please refer to the accompanying financial tables for reconciliation of GAAP financial information to non-GAAP).
Gross margin on a GAAP basis in the first quarter of 2011 was 29.5% of revenues. Gross margin on a non-GAAP basis was 32.4% of revenues.
Operating loss on a GAAP basis in the first quarter of 2011 was $20.3 million. On a non-GAAP basis operating profit was $185,000.
Cash and cash investments at the end of the quarter were $78.1 million.
“We are happy to conclude another strong quarter,” said Ira Palti, President and CEO of Ceragon. “Revenue from traditional Ceragon customers in the quarter accounted for about 70%, making it another record quarter for our core business, and the revenue contribution from Nera Networks customers since the January 19th closing was in line with our expectations.
“In Q1 we moved quickly to identify and implement most of the necessary steps towards the integration of Nera Networks operations,” continued Mr. Palti. “We are pleased with the progress we’ve made in a short amount of time, including the migration of several key Nera Networks customers to the Ceragon FibeAir short-haul product line. Based on our excellent progress in Q1, we believe that we are on track to reach, by the end of 2011, quarterly revenues run rate of $125. This will be a half-way mark toward our goal of $150 million in quarterly revenue run rate and over 10% operating margin, to be reached by the end of 2012.”
Supplemental revenue breakouts:
Geographical breakdown, first quarter of 2011:
North America: 13%
Latin America: 15%
A conference call will follow today, May16, 2011, beginning at 9:00 a.m. EDT. Investors are invited to join the Company’s teleconference by calling (800) 230-1059 or international (612) 234-9959 at 8:50 a.m. EDT. The call-in lines will be available on a first-come, first-serve basis.
Investors can also listen to the call live via the Internet by accessing Ceragon Networks’ website at the investors’ page: http://www.ceragon.com/ir_events.asp?lang=0 selecting the webcast link, and following the registration instructions.
If you are unable to join us live, the replay numbers are: (USA) (800) 475-6701 or (International) (320) 365-3844, Access Code: 195281.
A replay of both the call and the webcast will be available through June 22, 2011.
GK Public Relations
Phone: (914) 768-4219
Ceragon Networks Ltd.
Phone: (201) 853-0271