Exhibit 99.1
ADTRAN, Inc. Reports Fourth Quarter 2007 Results and Declares Quarterly Cash Dividend
HUNTSVILLE, Ala.--(BUSINESS WIRE)--ADTRAN, Inc. (NASDAQ:ADTN) reported results for the fourth quarter of 2007. Sales increased 9% to $118,971,000 for the quarter compared to $109,114,000 for the fourth quarter of 2006. Operating income increased 24% to $25,428,000 for the quarter compared to $20,564,000 for the fourth quarter of 2006. Net income was $18,111,000 for the quarter compared to $17,056,000 for the fourth quarter of 2006. Earnings per share, assuming dilution, were $0.27 for the quarter compared to $0.24 for the fourth quarter of 2006.
ADTRAN Chief Executive Officer Tom Stanton stated, “In the fourth quarter we continued to see the benefits of our strategy of expanding into system level applications and new geographical areas. Total revenue in our growth businesses grew 56% in the quarter compared to the same period in the prior year. Our Broadband Access category led this growth with a record 98% revenue increase compared to the same period in the prior year, as we began to see the effects of market share gains for fiber-to-the-node applications in both domestic and international markets. Optical Access and Internetworking product categories continued to demonstrate strong momentum as we saw solid growth in these areas for the fourth quarter compared to the same period in the prior year.”
Tom Stanton also stated, “During the year 2007 we were successful in capturing a significant number of meaningful new customer opportunities. We believe these achievements along with our strong operating model will provide considerable, long term revenue and earnings growth for our company.”
The Company also announced that its Board of Directors declared a cash dividend for the fourth quarter of 2007. The quarterly cash dividend is $0.09 per common share to be paid to holders of record at the close of business on February 7, 2008. The ex-dividend date is February 5, 2008 and the payment date is February 21, 2008.
The Company also confirmed that its fourth quarter conference call will be held Tuesday, January 22, 2008 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.com or http://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://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, with a portfolio of more than 1,600 solutions for use in the last mile of today's telecommunications networks. Widely deployed by carriers and enterprises alike, ADTRAN solutions enable voice, data, video, and Internet communications across copper, fiber, and wireless network infrastructures. ADTRAN solutions are currently in use by every major U.S. service provider and many global ones, as well as by thousands of public, private and governmental organizations worldwide.
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, 2006 and Form 10-Q for the quarter ended September 30, 2007. These risks and uncertainties could cause actual results to differ materially from those in the forward-looking statements included in this press release.
Condensed Balance Sheet Unaudited (In thousands) | ||||||
| December 31, | December 31, | ||||
2007 | 2006 | |||||
| Assets | ||||||
| Cash and cash equivalents | $ | 13,941 | $ | 40,147 | ||
| Short-term investments | 148,416 | 99,700 | ||||
| Accounts receivable, net | 70,667 | 56,769 | ||||
| Other receivables | 3,085 | 7,481 | ||||
| Income tax receivable, net | - | 1,446 | ||||
| Inventory, net | 48,546 | 53,117 | ||||
| Prepaid expenses and other current assets | 9,682 | 10,505 | ||||
| Total current assets | 294,337 | 269,165 | ||||
| Property, plant and equipment, net | 75,969 | 80,194 | ||||
| Deferred tax assets, net | 1,113 | - | ||||
| Other assets | 505 | 534 | ||||
| Long-term investments | 107,296 | 189,765 | ||||
| Total assets | $ | 479,220 | $ | 539,658 | ||
| Liabilities and Stockholders’ Equity | ||||||
| Accounts payable | $ | 22,200 | $ | 30,321 | ||
| Unearned revenue | 5,361 | 5,802 | ||||
| Accrued expenses | 3,801 | 3,827 | ||||
| Accrued wages and benefits | 10,497 | 9,579 | ||||
| Income tax payable, net | 1,217 | - | ||||
| Total current liabilities | 43,076 | 49,529 | ||||
| Deferred tax liabilities, net | - | 694 | ||||
| Other non-current liabilities | 9,213 | 4,667 | ||||
| Bonds payable | 48,500 | 48,812 | ||||
| Total liabilities | 100,789 | 103,702 | ||||
| Stockholders’ equity | 378,431 | 435,956 | ||||
| Total liabilities and stockholders’ equity | $ | 479,220 | $ | 539,658 | ||
Consolidated Statements of Income (In thousands, except per share data) Unaudited | ||||||||||||||||
Three Months Ended | Three Months Ended | Twelve Months Ended | Twelve Months Ended | |||||||||||||
December 31, 2007 | December 31, 2006 | December 31, 2007 | December 31, 2006 | |||||||||||||
| Sales | $ | 118,971 | $ | 109,114 | $ | 476,778 | $ | 472,708 | ||||||||
| Cost of sales | 49,452 | 45,727 | 193,792 | 193,747 | ||||||||||||
| Gross profit | 69,519 | 63,387 | 282,986 | 278,961 | ||||||||||||
| Selling, general and administrative expenses | 25,363 | 25,704 | 103,329 | 102,646 | ||||||||||||
| Research and development expenses | 18,728 | 17,119 | 75,367 | 70,700 | ||||||||||||
| Operating income | 25,428 | 20,564 | 104,290 | 105,615 | ||||||||||||
| Interest income | 2,765 | 3,212 | 11,521 | 13,493 | ||||||||||||
| Interest expense | (626 | ) | (632 | ) | (2,502 | ) | (2,532 | ) | ||||||||
| Net realized investment gain | (10 | ) | 250 | 498 | 1,379 | |||||||||||
| Other income, net | 64 | 128 | 764 | 570 | ||||||||||||
| Life insurance proceeds | - | - | 1,000 | - | ||||||||||||
| Income before provision for income taxes | 27,621 | 23,522 | 115,571 | 118,525 | ||||||||||||
| Provision for income taxes | (9,510 | ) | (6,466 | ) | (39,236 | ) | (40,192 | ) | ||||||||
| Net income | $ | 18,111 | $ | 17,056 | $ | 76,335 | $ | 78,333 | ||||||||
| Weighted average shares outstanding | ||||||||||||||||
| Basic | 65,752 | 70,228 | 67,848 | 73,451 | ||||||||||||
| Diluted (1) | 66,866 | 71,788 | 69,212 | 75,197 | ||||||||||||
| Earnings per common share | ||||||||||||||||
| Basic | $ | 0.28 | $ | 0.24 | $ | 1.13 | $ | 1.07 | ||||||||
| Diluted (1) | $ | 0.27 | $ | 0.24 | $ | 1.10 | $ | 1.04 | ||||||||
(1) Assumes exercise of dilutive stock options calculated under the treasury stock method. | ||||||||||||||||
Consolidated Statements of Cash Flow For the Twelve Months ended December 31, Unaudited (In thousands) | ||||||||
2007 | 2006 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income | $ | 76,335 | $ | 78,333 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depreciation and amortization | 10,695 | 10,827 | ||||||
| Amortization of net premium on available-for-sale investments | 2,094 | 3,137 | ||||||
| Gain on sale of long-term investments | (580 | ) | (1,379 | ) | ||||
| Loss on disposal of property, plant and equipment | 65 | 73 | ||||||
| Stock-based compensation expense | 7,815 | 8,138 | ||||||
| Deferred income taxes | (2,960 | ) | (4,332 | ) | ||||
| Tax benefit from stock option exercises | 4,408 | 1,583 | ||||||
| Excess tax benefits from stock-based compensation arrangements | (3,249 | ) | (973 | ) | ||||
| Change in operating assets and liabilities: | ||||||||
| Accounts receivable, net | (13,898 | ) | 9,477 | |||||
| Other receivables | 4,396 | (4,267 | ) | |||||
| Income tax receivable, net | 1,446 | (1,446 | ) | |||||
| Inventory, net | 4,571 | (2,185 | ) | |||||
| Prepaid expenses and other assets | 596 | 167 | ||||||
| Accounts payable | (7,933 | ) | 4,932 | |||||
| Accrued expenses and other liabilities | 3,517 | (2,256 | ) | |||||
| Income tax payable, net | 1,507 | (4,551 | ) | |||||
| Net cash provided by operating activities | 88,825 | 95,278 | ||||||
| Cash flows from investing activities: | ||||||||
| Purchases of property, plant and equipment | (6,535 | ) | (6,061 | ) | ||||
| Proceeds from sales and maturities of available-for-sale investments | 253,339 | 323,211 | ||||||
| Purchases of available-for-sale investments | (217,316 | ) | (293,098 | ) | ||||
| Acquisition of business | - | (400 | ) | |||||
| Net cash provided by investing activities | 29,488 | 23,652 | ||||||
| Cash flows from financing activities: | ||||||||
| Proceeds from stock option exercises | 15,288 | 4,441 | ||||||
| Purchases of treasury stock | (138,589 | ) | (170,479 | ) | ||||
| Dividend payments | (24,600 | ) | (26,755 | ) | ||||
| Payments on long-term debt | (500 | ) | (500 | ) | ||||
| Excess tax benefits from stock-based compensation arrangements | 3,249 | 973 | ||||||
| Net cash used in financing activities | (145,152 | ) | (192,320 | ) | ||||
| Net decrease in cash and cash equivalents | (26,839 | ) | (73,390 | ) | ||||
| Effect of exchange rate changes | 633 | 743 | ||||||
| Cash and cash equivalents, beginning of period | 40,147 | 112,794 | ||||||
| Cash and cash equivalents, end of period | $ | 13,941 | $ | 40,147 | ||||
CONTACT:
ADTRAN, Inc.
Jim Matthews, Senior Vice President/CFO, 256-963-8775
or
Investor Services/Assistance:
Gayle Ellis, 256-963-8220