Welcome!

SAP Authors: Carmen Gonzalez, Pat Romanski, Roger Strukhoff, Yeshim Deniz, Elizabeth White

News Feed Item

MRV Announces Third Quarter 2012 Financial Results

Network Equipment Revenue Grows 8% Sequentially

CHATSWORTH, CA -- (Marketwire) -- 11/09/12 -- MRV Communications, Inc. (OTCQB: MRVC) ("MRV" or the "Company"), a leading provider of optical communications network infrastructure equipment and integration and managed services, today announced financial results for the third quarter ended September 30, 2012.

"We have made solid progress executing on our strategic initiatives including building and investing in our optical communications system business and completing the divestitures of our Network Integration subsidiaries in France and Sweden," said Barry Gorsun, MRV's chief executive officer.

"In the third quarter, Network Equipment revenue grew 8% sequentially and we added 39 new customers. Our optical communications solutions are gaining momentum and in the quarter we won two large international Carrier Ethernet deployments with our OptiSwitch® solution, reflecting the strength of our technology. We are well positioned in the optical transport and carrier Ethernet markets and specifically in the rapidly growing mobile backhaul, data center and cloud computing verticals. We intend to leverage our strengths and continue investing in our optical communications systems to bring innovative products to the high growth segments of our market," concluded Gorsun.

Third Quarter 2012 Results
MRV reported third quarter 2012 revenue of $51.6 million, compared with revenue of $55.0 million in the second quarter of 2012 and $54.2 million in the third quarter of 2011. Sequentially, MRV's third quarter revenue was impacted by a 17% decline in Network Integration revenue that was primarily attributable to decreases in local currencies combined with lower product revenue and partially offset by 8% sequential growth in Network Equipment, which is substantially comprised of our optical communications systems business. The year-over-year decline in revenue was due to an 11% decline in Network Integration revenue related to lower product sales, delayed recognition upon acceptance of previously installed equipment and continued economic weakness in Europe. This decline was offset by 1% year-over-year growth in Network Equipment revenue driven by increased sales for the OptiSwitch and related network optical communications components.

Gross margin for the third quarter of 2012 improved to 37.3%, compared with 34.4% in the second quarter of 2012, and 37.1% in the third quarter of 2011. Increased sales of higher gross margin products in the Company's Network Equipment group primarily contributed to the year-over-year gross margin improvement, and to a lesser extent a reclassification of engineering labor to an expense. In the Network Integration group, margins declined due to highly competitive European markets that are driving increased pricing pressure, and a change in product and service revenue mix.

Operating expenses in the third quarter of 2012 were $20.3 million, or 39% of revenue, and included a $1.1 million goodwill impairment charge related to the Company's subsidiary in Italy. Excluding this charge, operating expenses in the third quarter were $19.2 million or 37% of revenue, compared with $17.9 million, or 33% of revenue in the third quarter of 2011, and excluding a $3.7 million impairment charge related to the Company's Swedish subsidiary, $18.6 million or 33% of revenue in the second quarter of 2012. The year-over-year increase in operating expenses was primarily due to an increase in corporate operating expenses of $1.2 million attributable to legal fees associated with derivative litigation, and professional fees related to the sale of the Company's Swedish and French Network Integration subsidiaries. Excluding the impairment charges in the second and third quarters of 2012, operating expenses increased sequentially also due to the aforementioned legal and professional fees.

Operating loss for the third quarter of 2012 was $1.0 million, and included a $1.1 million goodwill impairment charge related to the Company's subsidiary in Italy. Excluding this charge, the operating profit in the third quarter was $0.1 million, compared with an operating profit of $2.2 million in the third quarter of 2011. Operating income included share-based compensation expense of $0.3 million and $0.4 million in the third quarter of 2012 and 2011, respectively. Operating income for MRV's Network Equipment group was $2.2 million, a 69% increase compared with $1.3 million in the third quarter of 2011.

A more detailed discussion of MRV's 2012 third quarter financial results, including an analysis by business segment, is included in the Management Discussion and Analysis section of the Company's Form 10-Q filed today.

Recent Highlights

  • MRV's OptiSwitch solution was selected by CyC S.A., the telecommunications subsidiary for Argentina's largest electricity company, to launch a Carrier Ethernet network capable of supporting wholesale mobile backhaul and other revenue-generating data services.
  • MRV's OptiSwitch and ProVision® products were selected for an international metro-Ethernet deployment in Asia.
  • MRV expanded the award-winning OptiSwitch Carrier Ethernet Access portfolio with the introduction of a complete demarcation-to-aggregation solution, which comprises of the OptiSwitch 906G and OptiSwitch 9244-1210G models.
  • MRV's Fiber Driver® High Density 10G Transport Solution was recognized by TMC, a global, integrated media company, for exceptional innovation in advancing communications.
  • MRV successfully completed the stockholder-approved divestitures of MRV's Network Integration subsidiaries Alcadon-MRV AB and Interdata.

About MRV Communications, Inc.

MRV Communications, Inc. is a leading global provider of carrier Ethernet, wavelength division multiplexing optical transport, infrastructure management equipment and solutions, as well as network integration and managed services. MRV's solutions enable the delivery and provisioning of next-generation optical transport and carrier Ethernet services over any fiber infrastructure. MRV provides equipment and services worldwide to telecommunications service providers, enterprises and governments, enabling network evolution and increasing efficiency, while reducing complexity and costs. Through its subsidiaries, MRV operates development centers in North America and Europe, along with support centers and sales offices around the world. For more information about MRV, visit http://www.mrv.com.

Forward Looking Statements

This press release may contain statements regarding future financial and operating results of MRV, management's assessment of business trends, and other statements about management's future expectations, beliefs, goals, plans or prospects and those of the market segments in which MRV is engaged that are based on management's current expectations, estimates, forecasts and projections about MRV and its consolidated businesses and the respective market segments in which MRV's businesses operate, in addition to management's assumptions. Statements in this press release regarding MRV's future financial and operating results, which are not statements of historical facts, constitute forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words such as "expects," "anticipates," "envisions," "estimates," "targets," "intends," "plans," "believes," "seeks," "should," "could," "forecasts," "projects," variations of such words and similar expressions, are intended to identify such forward-looking statements which are not statements of historical facts. These forward-looking statements are not guarantees of future performance nor guarantees that the events anticipated will occur or expected conditions will remain the same or improve. These statements involve certain risks, uncertainties and assumptions, the likelihood of which are difficult to assess and may not occur, including risks that each of its business segments may not make the expected progress in its respective market, or that management's long-term strategy may not achieve the expected results. Therefore, actual outcomes, performance and results may differ from what is expressed or forecast in such forward-looking statements, and such differences may vary materially from current expectations.

For further information regarding risks and uncertainties associated with MRV's businesses, please refer to the "Management's Discussion and Analysis of Results of Operations and Financial Condition" and "Risk Factors" sections of MRV's SEC filings, including, but not limited to, its annual report on Form 10-K for the year ended December 31, 2011, and its quarterly report on Form 10-Q for the quarter ended September 30, 2012, copies of which may be obtained by contacting MRV's investor relations department or by visiting MRV's website at http://www.mrv-corporate.com or the SEC's EDGAR website at http://www.sec.gov.

All information in this release is as of September 30, 2012 unless otherwise stated. MRV undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in MRV's expectations.


                          MRV Communications, Inc
                          Statement of Operations
                   (In thousands, except per share data)

                            Three Months Ended         Nine months ended
                               September 30,             September 30,
                         ------------------------  ------------------------

                             2012         2011         2012         2011
                         (unaudited)  (unaudited)  (unaudited)  (unaudited)
                         -----------  -----------  -----------  -----------

                         -----------  -----------  -----------  -----------
Revenue                  $    51,613  $    54,193  $   155,004  $   166,596
Cost of goods sold            32,387       34,081       99,665      103,124
                         -----------  -----------  -----------  -----------
Gross profit                  19,226       20,112       55,339       63,472
Operating expenses:
  Product development
   and engineering             4,052        3,325       11,226       10,766
  Selling, general and
   administrative             15,169       14,583       47,453       49,011
  Impairment of goodwill       1,055            -        4,689            -
                         -----------  -----------  -----------  -----------
Total operating expenses      20,276       17,908       63,368       59,777
                         -----------  -----------  -----------  -----------
Operating income (loss)       (1,050)       2,204       (8,029)       3,695
  Interest Expense               (82)        (216)        (540)        (653)
  Gain from settlement
   of deferred
   Consideration
   obligation                      -            -        2,314            -
  Other income (loss),
   net                            57          (48)          24         (260)
                         -----------  -----------  -----------  -----------
Income (loss) from
 continuing operations
 before taxes                 (1,075)       1,939       (6,231)       2,781
  Provision (benefit)
   for income taxes            1,252         (295)       2,573        2,217
                         -----------  -----------  -----------  -----------
Net income (loss) of
 continuing operations        (2,327)       2,234       (8,804)         565

Income (loss) from
 discontinued
 operations, net of
 income taxes of $0 in
 2012 and $841 in 2011             -         (153)       7,975         (894)
                         -----------  -----------  -----------  -----------
Net income (loss)             (2,327)       2,081         (829)        (329)
                         ===========  ===========  ===========  ===========

Net income (loss) per
 share - basic:
  From continuing
   operations:           $     (0.01) $      0.01  $     (0.06) $      0.00
  From discontinued
   operations:           $         -  $     (0.00) $      0.05  $      0.01
                         -----------  -----------  -----------  -----------
Net income (loss) per
 share - basic (1)       $     (0.01) $      0.01  $     (0.01) $      0.01

Net income (loss) per
 share - diluted:
  From continuing
   operations:           $     (0.01) $      0.01  $     (0.06) $      0.00
  From discontinued
   operations:           $         -  $     (0.00) $      0.05  $      0.01
                         -----------  -----------  -----------  -----------
Net income (loss) per
 share - diluted (1)     $     (0.01) $      0.01  $     (0.01) $      0.01

Weighted average number
 of shares:
  Basic                      155,314      157,535      156,939      157,518
  Diluted                    155,314      158,601      156,939      157,518

(1) Amounts may not add due to rounding.



                          MRV Communications, Inc
                               Balance Sheet
                               (In thousands)

                                               September 30,   December 31,
                                                    2012           2011

                                               -------------  -------------
Assets                                          (unaudited)
Current assets:
  Cash and cash equivalents                    $      39,036  $      71,352
  Short-term marketable securities                         -              -
  Restricted time deposits                               326            380
  Accounts receivable, net                            50,057         55,654
  Other recievables                                    9,040         11,604
  Inventories                                         30,873         28,134
  Deferred income taxes                                1,662          1,660
  Other current assets                                 7,657          5,168
  Current assets from discontinued operations
   held for sale                                           -         24,810
                                               -------------  -------------
Total current assets                                 138,651        198,762
Property and equipment, net                            6,442          6,789
Goodwill                                                 324          5,156
Deferred income taxes, net of current portion          3,732          4,113
Intangibles, net                                         400              0
Other assets                                             749            574
Noncurrent assets from discontinued operations             -         15,295
                                               -------------  -------------
Total assets                                   $     150,298  $     230,689
                                               =============  =============

Liabilities and stockholders' equity
Current liabilities:
  Short-term debt                              $       7,227  $       8,987
  Deferred consideration payable                         233          4,615
  Accounts payable                                    21,900         31,359
  Accrued liabilities                                 22,341         20,924
  Deferred revenue                                    11,741         10,985
  Other current liabilities                              236          1,693
  Current liabilities from discontinued
   operations held for sale                                -          3,236
                                               -------------  -------------
Total current liabilities                             63,678         81,799
Other long-term liabilities                            6,230          6,209
Long-term liabilities from discontinued
 operations                                                -            467
Commitments and contingencies

Stockholders' equity:
  Issued - 161,285 shares in 2012 and 160,609
   shares in 2011
  Outstanding - 151,925 shares in 2012 and
   157,704 in 2011                                       271            270
  Additional paid-in capital                       1,291,450      1,337,935
  Accumulated deficit                             (1,208,008)    (1,207,178)
  Treasury stock - 8,535 shares in 2012 and
   2,692 shares in 2011                               (6,076)        (3,271)
  Accumulated other comprehensive income               2,753         14,458
                                               -------------  -------------
Total stockholders' equity                            80,390        142,214
                                               -------------  -------------
Total liabilities and stockholders' equity     $     150,298  $     230,689
                                               =============  =============


Contact:

Investor Relations:
MRV Communications, Inc.
(818) 886-MRVC (6782)
Email Contact

or

Media Relations:
MRV Communications, Inc.
Email Contact

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

@ThingsExpo Stories
The Internet of Things will greatly expand the opportunities for data collection and new business models driven off of that data. In her session at Internet of @ThingsExpo, Esmeralda Swartz, CMO of MetraTech, will discuss how for this to be effective you not only need to have infrastructure and operational models capable of utilizing this new phenomenon, but increasingly service providers will need to convince a skeptical public to participate. Get ready to show them the money! Speaker Bio: Esmeralda Swartz, CMO of MetraTech, has spent 16 years as a marketing, product management, and busin...
Samsung VP Jacopo Lenzi, who headed the company's recent SmartThings acquisition under the auspices of Samsung's Open Innovaction Center (OIC), answered a few questions we had about the deal. This interview was in conjunction with our interview with SmartThings CEO Alex Hawkinson. IoT Journal: SmartThings was developed in an open, standards-agnostic platform, and will now be part of Samsung's Open Innovation Center. Can you elaborate on your commitment to keep the platform open? Jacopo Lenzi: Samsung recognizes that true, accelerated innovation cannot be driven from one source, but requires a...
SYS-CON Events announced today that Red Hat, the world's leading provider of open source solutions, will exhibit at Internet of @ThingsExpo, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Red Hat is the world's leading provider of open source software solutions, using a community-powered approach to reliable and high-performing cloud, Linux, middleware, storage and virtualization technologies. Red Hat also offers award-winning support, training, and consulting services. As the connective hub in a global network of enterprises, partners, a...
P2P RTC will impact the landscape of communications, shifting from traditional telephony style communications models to OTT (Over-The-Top) cloud assisted & PaaS (Platform as a Service) communication services. The P2P shift will impact many areas of our lives, from mobile communication, human interactive web services, RTC and telephony infrastructure, user federation, security and privacy implications, business costs, and scalability. In his session at Internet of @ThingsExpo, Robin Raymond, Chief Architect at Hookflash Inc., will walk through the shifting landscape of traditional telephone a...
BSQUARE is a global leader of embedded software solutions. We enable smart connected systems at the device level and beyond that millions use every day and provide actionable data solutions for the growing Internet of Things (IoT) market. We empower our world-class customers with our products, services and solutions to achieve innovation and success. For more information, visit www.bsquare.com.
SYS-CON Events announced today that Matrix.org has been named “Silver Sponsor” of Internet of @ThingsExpo, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Matrix is an ambitious new open standard for open, distributed, real-time communication over IP. It defines a new approach for interoperable Instant Messaging and VoIP based on pragmatic HTTP APIs and WebRTC, and provides open source reference implementations to showcase and bootstrap the new standard. Our focus is on simplicity, security, and supporting the fullest feature set.
How do APIs and IoT relate? The answer is not as simple as merely adding an API on top of a dumb device, but rather about understanding the architectural patterns for implementing an IoT fabric. There are typically two or three trends: Exposing the device to a management framework Exposing that management framework to a business centric logic • Exposing that business layer and data to end users. This last trend is the IoT stack, which involves a new shift in the separation of what stuff happens, where data lives and where the interface lies. For instance, it’s a mix of architectural style...
SYS-CON Events announced today that SOA Software, an API management leader, will exhibit at SYS-CON's 15th International Cloud Expo®, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. SOA Software is a leading provider of API Management and SOA Governance products that equip business to deliver APIs and SOA together to drive their company to meet its business strategy quickly and effectively. SOA Software’s technology helps businesses to accelerate their digital channels with APIs, drive partner adoption, monetize their assets, and achieve a...
From a software development perspective IoT is about programming "things," about connecting them with each other or integrating them with existing applications. In his session at @ThingsExpo, Yakov Fain, co-founder of Farata Systems and SuranceBay, will show you how small IoT-enabled devices from multiple manufacturers can be integrated into the workflow of an enterprise application. This is a practical demo of building a framework and components in HTML/Java/Mobile technologies to serve as a platform that can integrate new devices as they become available on the market.
SYS-CON Events announced today that Utimaco will exhibit at SYS-CON's 15th International Cloud Expo®, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Utimaco is a leading manufacturer of hardware based security solutions that provide the root of trust to keep cryptographic keys safe, secure critical digital infrastructures and protect high value data assets. Only Utimaco delivers a general-purpose hardware security module (HSM) as a customizable platform to easily integrate into existing software solutions, embed business logic and build s...
Connected devices are changing the way we go about our everyday life, from wearables to driverless cars, to smart grids and entire industries revolutionizing business opportunities through smart objects, capable of two-way communication. But what happens when objects are given an IP-address, and we rely on that connection, sometimes with our lives? How do we secure those vast data infrastructures and safe-keep the privacy of sensitive information? This session will outline how each and every connected device can uphold a core root of trust via a unique cryptographic signature – a “bir...
Internet of @ThingsExpo Silicon Valley announced on Thursday its first 12 all-star speakers and sessions for its upcoming event, which will take place November 4-6, 2014, at the Santa Clara Convention Center in California. @ThingsExpo, the first and largest IoT event in the world, debuted at the Javits Center in New York City in June 10-12, 2014 with over 6,000 delegates attending the conference. Among the first 12 announced world class speakers, IBM will present two highly popular IoT sessions, which will take place November 4-6, 2014 at the Santa Clara Convention Center in Santa Clara, Calif...
Almost everyone sees the potential of Internet of Things but how can businesses truly unlock that potential. The key will be in the ability to discover business insight in the midst of an ocean of Big Data generated from billions of embedded devices via Systems of Discover. Businesses will also need to ensure that they can sustain that insight by leveraging the cloud for global reach, scale and elasticity.
WebRTC defines no default signaling protocol, causing fragmentation between WebRTC silos. SIP and XMPP provide possibilities, but come with considerable complexity and are not designed for use in a web environment. In his session at Internet of @ThingsExpo, Matthew Hodgson, technical co-founder of the Matrix.org, will discuss how Matrix is a new non-profit Open Source Project that defines both a new HTTP-based standard for VoIP & IM signaling and provides reference implementations.

SUNNYVALE, Calif., Oct. 20, 2014 /PRNewswire/ -- Spansion Inc. (NYSE: CODE), a global leader in embedded systems, today added 96 new products to the Spansion® FM4 Family of flexible microcontrollers (MCUs). Based on the ARM® Cortex®-M4F core, the new MCUs boast a 200 MHz operating frequency and support a diverse set of on-chip peripherals for enhanced human machine interfaces (HMIs) and machine-to-machine (M2M) communications. The rich set of periphera...

SYS-CON Events announced today that Aria Systems, the recurring revenue expert, has been named "Bronze Sponsor" of SYS-CON's 15th International Cloud Expo®, which will take place on November 4-6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Aria Systems helps leading businesses connect their customers with the products and services they love. Industry leaders like Pitney Bowes, Experian, AAA NCNU, VMware, HootSuite and many others choose Aria to power their recurring revenue business and deliver exceptional experiences to their customers.
The Internet of Things (IoT) is going to require a new way of thinking and of developing software for speed, security and innovation. This requires IT leaders to balance business as usual while anticipating for the next market and technology trends. Cloud provides the right IT asset portfolio to help today’s IT leaders manage the old and prepare for the new. Today the cloud conversation is evolving from private and public to hybrid. This session will provide use cases and insights to reinforce the value of the network in helping organizations to maximize their company’s cloud experience.
The Internet of Things (IoT) is making everything it touches smarter – smart devices, smart cars and smart cities. And lucky us, we’re just beginning to reap the benefits as we work toward a networked society. However, this technology-driven innovation is impacting more than just individuals. The IoT has an environmental impact as well, which brings us to the theme of this month’s #IoTuesday Twitter chat. The ability to remove inefficiencies through connected objects is driving change throughout every sector, including waste management. BigBelly Solar, located just outside of Boston, is trans...
SYS-CON Events announced today that Matrix.org has been named “Silver Sponsor” of Internet of @ThingsExpo, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Matrix is an ambitious new open standard for open, distributed, real-time communication over IP. It defines a new approach for interoperable Instant Messaging and VoIP based on pragmatic HTTP APIs and WebRTC, and provides open source reference implementations to showcase and bootstrap the new standard. Our focus is on simplicity, security, and supporting the fullest feature set.
Predicted by Gartner to add $1.9 trillion to the global economy by 2020, the Internet of Everything (IoE) is based on the idea that devices, systems and services will connect in simple, transparent ways, enabling seamless interactions among devices across brands and sectors. As this vision unfolds, it is clear that no single company can accomplish the level of interoperability required to support the horizontal aspects of the IoE. The AllSeen Alliance, announced in December 2013, was formed with the goal to advance IoE adoption and innovation in the connected home, healthcare, education, aut...