For investor information contact:
Leigh Salvo, Investor Relations
(650) 314-1000
Investor_relations@catapult.com
CATAPULT COMMUNICATIONS REPORTS
FIRST QUARTER FISCAL 2006 RESULTS
Mountain View, CA—January 30, 2006—Catapult Communications Corporation (Nasdaq: CATT) today reported that revenues for its first fiscal quarter ended December 31, 2005 were $12.1 million in comparison with $15.9 million for the comparable quarter a year ago. Net income and diluted earnings per share for the first fiscal quarter were $143,000 and $0.01, respectively, in comparison with $3.8 million and $0.25, respectively, in the first quarter of fiscal 2005. Net income and earnings per share for the first quarter of fiscal 2006 reflected the impact of approximately $574,000 in pre-tax, non-cash stock option expenses recognized under FAS 123R. No stock option expenses were recorded in the first quarter of fiscal 2005. Cash, cash equivalents and short-term investments increased by $2.8 million to $71.6 million during the first fiscal quarter of 2006.
“Revenues in the first quarter were negatively impacted by two factors,” said Dr. Richard A. Karp, Chairman and CEO. “First, two major Japanese customers have returned to making their own test equipment, both for their own use and for sale into our major Japanese telecom operator customers. Second, we experienced additional revenue recognition delays as a result of the length of time and level of resources required to complete our common hardware platform.”
Catapult Communications will be discussing its first quarter results on a conference call today, beginning at 5:15 p.m. Eastern/2:15 p.m. Pacific. Please dial (866) 271-5140 to access the conference call. International and local participants can dial (617) 213-8893. Please reference Catapult Communications or reservation number 91152825. The conference call will also be available on the Internet from the Investor section of the Company’s website.
A replay of this teleconference will be available on the Company’s website for one year following the conference call. A digital recording will also be available by telephone one hour after the completion of the conference call through midnight on February 3, 2006. To access the replay, please dial (888) 286-8010 or (617) 801-6888 and enter reservation number 15409702.
About Catapult Communications
Catapult Communications is a leading supplier of advanced digital telecom test systems to global equipment manufacturers and service providers, including Ericsson, Lucent, Motorola, NEC, NTT DoCoMo, Nortel and Siemens. The Catapult DCT2000® and MGTS® systems deliver superior high-end test solutions for hundreds of protocols and variants — spanning 3G, VoIP, GPRS, SS7, Intelligent Network, ATM, ISDN and other network environments. The Company is committed to providing testing tools that are at the forefront of the telecom technology curve. Catapult is headquartered at 160 South Whisman Road, Mountain View, CA 94041. Tel: 650-960-1025. International offices are located in the U.K., Germany, France, Finland, Sweden, Canada, Japan, China and Australia. Information about Catapult Communications can be found on the Web atwww.catapult.com.
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Catapult Communications Corporation
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
(Unaudited)
For the three months ended | ||||||||
December 31, | ||||||||
2005 | 2004 | |||||||
Revenues: | ||||||||
Products | $ | 8,534 | $ | 12,373 | ||||
Services | 3,568 | 3,498 | ||||||
Total revenues | 12,102 | 15,871 | ||||||
Cost of revenues: | ||||||||
Products | 1,188 | 1,242 | ||||||
Services | 1,062 | 821 | ||||||
Amortization of purchased technology | 171 | 171 | ||||||
Total cost of revenues | 2,421 | 2,234 | ||||||
Gross profit | 9,681 | 13,637 | ||||||
Operating expenses: | ||||||||
Research and development | 3,083 | 2,971 | ||||||
Sales and marketing | 4,627 | 4,703 | ||||||
General and administrative | 2,427 | 1,906 | ||||||
Total operating expenses | 10,137 | 9,580 | ||||||
Operating income (loss) | (456 | ) | 4,057 | |||||
Interest income | 620 | 224 | ||||||
Interest expense | — | — | ||||||
Other income, net | 13 | 7 | ||||||
Income before income taxes | 177 | 4,288 | ||||||
Provision for income taxes | 34 | 475 | ||||||
Net income | $ | 143 | $ | 3,813 | ||||
Net income per share: | ||||||||
Basic | $ | 0.01 | $ | 0.26 | ||||
Diluted | $ | 0.01 | $ | 0.25 | ||||
Shares used in per share calculation: | ||||||||
Basic | 14,743 | 14,600 | ||||||
Diluted | 15,006 | 15,147 | ||||||
Catapult Communications Corporation
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
December 31, | September 30, | |||||||
2005 | 2005 | |||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash, cash equivalents and short-term investments | $ | 71,628 | $ | 68,807 | ||||
Accounts receivable, net | 12,600 | 14,724 | ||||||
Inventories | 4,187 | 3,104 | ||||||
Other current assets | 1,694 | 2,004 | ||||||
Total current assets | 90,109 | 88,639 | ||||||
Property and equipment, net | 1,696 | 1,693 | ||||||
Goodwill and other intangibles | 53,188 | 53,445 | ||||||
Other assets | 3,953 | 3,983 | ||||||
Total assets | $ | 148,946 | $ | 147,760 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable and accrued liabilities | $ | 6,319 | $ | 7,055 | ||||
Deferred revenue | 8,502 | 7,697 | ||||||
Total current liabilities | 14,821 | 14,752 | ||||||
Deferred revenue long-term portion | 403 | 485 | ||||||
Total liabilities | 15,224 | 15,237 | ||||||
Total stockholders’ equity | 133,722 | 132,523 | ||||||
Total liabilities and | ||||||||
stockholders’ equity | $ | 148,946 | $ | 147,760 | ||||
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