Milpitas, California, February 5, 2009 – JDSU (NASDAQ: JDSU; and TSX: JDU) today reported results for its second fiscal quarter ended December 27, 2008.
Net revenue for the second fiscal quarter was $357.0 million and the net loss was $(705.3) million, or $(3.28) per share, primarily due to an impairment of goodwill and long-lived assets of $699.6 million.This compares to net revenue of $399.2 million and net income of $21.2 million or $0.09 per share in the second fiscal quarter of 2008.
On a non-GAAP basis, net income for the quarter was $24.8 million or $0.11 per share. This compares with non-GAAP net income of $50.2 million or $0.22 per share in the second fiscal quarter of 2008.
Revenue for the second fiscal quarter excluded approximately $10 million for optical communications products that were shipped to Nortel for which payment was not received prior to its bankruptcy filing on January 14, 2009. This revenue has been deferred.
On an adjusted EBITDA basis (adjusted Earnings Before Interest, Taxes, Depreciation and Amortization) the Company reported $36.4 million for the quarter, which compares to $61.8 million in the second fiscal quarter of 2008.
“During these challenging economic times we continue to make progress in improving the cost structure and operating model of the company,” said Tom Waechter, JDSU’s President and Chief Executive Officer. “We will continue to focus on innovation and our lean initiative activities, which I believe will uniquely position JDSU for future growth once market conditions improve.”
Financial Overview – Fiscal 2009 Second Quarter Ended December 27, 2008
- Second quarter non-GAAP net revenue of $357.2 million decreased 6.2% when compared to the previous quarter and 10.5% when compared to the second quarter of fiscal 2008.
- Non-GAAP gross margins were 43.5% compared to 43.3% in fiscal Q1 2009 and 46.3% in fiscal Q2 2008.
- Non-GAAP operating margins were 5.2% compared to 5.4% in fiscal Q1 2009 and 11.4% in fiscal Q2 2008.
- Second quarter Communication and Commercial Optical Products revenue of $127.9 million decreased 21.0% compared with the previous quarter and 15.8% compared to the second quarter of fiscal 2008. Revenue from this segment represented 36% of total non-GAAP net revenue.
- Second quarter Optical Communications revenue of $109.5 million decreased 22.2% compared with the previous quarter and 15.6% compared to the second quarter of fiscal 2008.
- Our Commercial Lasers business reported revenue of $18.4 million, down 13.7% from the previous quarter and 16.8% from the second quarter of fiscal 2008.
- Communications Test and Measurement revenue of $176.2 million increased 6.6% from the previous quarter and decreased 10.8% compared to the second quarter of fiscal 2008. Revenue from this segment represented 49% of total non-GAAP net revenue.
- Revenue from the Advanced Optical Technologies segment was $53.1 million, down 0.8% from the previous quarter and up 6.6% compared to the second quarter of fiscal 2008. Revenue from this segment represented 15% of total non-GAAP net revenue.
- Americas’ customers represented 47% of total non-GAAP net revenue. European and Asia-Pacific customers represented 30% and 23% of total non-GAAP net revenue, respectively.
- The Company held $689.0 million in total cash. During the quarter the Company reduced its outstanding debt by $125.0 million resulting in a gain of $22.3 million. The Company had positive cash flow from operations but was free cash flow negative by $4.6 million.
For the third quarter of fiscal 2009, ending March 28, 2009, the Company expects revenue to be in the range of $275 to $300 million.
The Company will discuss these results and other related matters at 2:00 p.m. Pacific Time on February 5, 2009 in alive webcast, which will also be archived for replay on the Company's website at www.jdsu.com/investors. This press releaseis being furnished as a Current Report on Form 8-K with the Securities and Exchange Commission, and will be available at http://www.sec.gov/.
JDSU (NASDAQ: JDSU; and TSX: JDU) enables broadband and optical innovation in the communications, commercial and consumer markets. JDSU is a leading provider of communications test and measurement solutions and optical products for telecommunications service providers, cable operators, and network equipment manufacturers. JDSU is also a leading provider of innovative optical solutions for medial/environmental instrumentation, semiconductor processing, display, brand authentication, aerospace and defense, and decorative applications. More information is available at http://www.jdsu.com/.
This press release contains, and the discussions in our subsequent conference call, will contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements include: (i) any anticipation or guidance as to future financial performance, including future revenue, gross margin, operating expense, operating margin, EBITDA, cash flow and other financial metrics; and (ii) the Company's beliefs regarding the purpose, usefulness and efficacy of non-GAAP results and the measures and items the Company includes in the same, as well as any benefits to investors the Company believes its non-GAAP measures provide. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected. In particular, the Company's ability to predict future financial performance continues to be difficult due to, among other things: (a) continuing general limited visibility across many of our product lines exacerbated by the current credit and financial market uncertainty; (b) the ongoing potential for significant quarter-over-quarter product mix fluctuations, which can materially impact profitability measures due to the broad gross margin range across our portfolio; (c) continuing consolidation activities affecting our customer base, which, in the shorter term limits demand visibility, and, in the longer term, could reduce our business potential; (d) average selling prices continue to decline across our businesses; (e) we and many of our Optical Communications suppliers continue to experience execution and delivery challenges which limit our revenue and impair our profitability; (f) our Communications Test and Measurement business is notable for seasonality and a significant level of in-quarter book-and-ship business, further limiting our forecasting abilities; (g) as we implement vendor-managed-inventory and similar programs for our customers, our visibility may be reduced; (h) we are currently engaged in various product and manufacturing transfers, site consolidations and product discontinuances, which has caused and may continue to cause execution disruptions, customer satisfaction issues and quality and delivery problems.
For more information on these and other risks affecting the Company's business, please refer to the “Risk Factors” section included in the Company's Annual Report on Form 10-K/A for the year ended June 28, 2008 and the Company’s Quarterly Report on Form 10-Q for the first fiscal quarter ended September 27, 2008, filed with the Securities and Exchange Commission. The forward-looking statements contained in this news release are made as of the date hereof and the Company does not assume any obligation to update the reasons why actual results could differ materially from those projected in the forward-looking statements.
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The following financial tables are presented in accordance with GAAP, unless otherwise specified.
SELECTED FINANCIAL DATA FOLLOWS