EXHIBIT 99.1
BUSINESS UPDATE
**For Immediate Release**
MULTILINK TECHNOLOGY CORPORATION REPORTS
SECOND QUARTER 2001 RESULTS
. Record revenue for the quarter of $35.1 million
. Second quarter gross margins improve to 63.8%
. Successful IPO with net proceeds of $77 million strengthens
balance sheet
Somerset, New Jersey U.S.A. - July 24, 2001 - Multilink Technology Corporation
(Nasdaq: MLTC), today reported results for the second quarter ended June 30,
2001.
Total revenues for the second quarter of 2001 were $35.1 million, an increase of
115%, compared with $16.3 million in the second quarter of 2000. Total revenues
for the second quarter of 2001 increased 13% sequentially over the $31.1 million
reported in the first quarter of 2001. Total revenues for the six-month period
ended June 30, 2001 were $66.2 million, an increase of 131%, compared with $28.7
million for the six-month period ended June 30, 2000.
Gross margins for the second quarter of 2001 were 63.8%, compared with 63.5% in
the first quarter of 2001 and gross margins of 63.0% in the second quarter of
2000, excluding deferred stock compensation in each period and a write down to
inventories which occurred in the first quarter of 2001. Including these items,
gross margins for the second quarter of 2001 were 62.5%, compared with 46.2% in
the first quarter of 2001 and gross margins of 62.2% in the second quarter of
2000.
Gross margins for the six-month period ended June 30, 2001 were 63.6%, compared
with gross margins of 62.1% for the six-month period ended June 30, 2000,
excluding deferred stock compensation in each period and a write down to
inventories which occurred in the first quarter of 2001. Including these items,
gross margins were 54.8% for the six-month period ended June 30, 2001, compared
with gross margins of 61.6% for the same period in 2000.
Net income for the second quarter of 2001 was $0.8 million, or diluted EPS
$0.01, compared with net income of $0.5 million, or diluted EPS $0.01, in the
first quarter of 2001 and net income of $2.7 million, or diluted EPS $0.03, in
the second quarter of 2000, excluding deferred stock compensation, warrant
issuances, a dividend related to warrant issuances and a write down to
inventories which occurred in the first quarter of 2001.
Including these non-cash items, net loss attributable to common shareholders for
the second quarter of 2001 was $0.9 million, or EPS ($0.03), compared with a net
loss attributable to common shareholders of $4.5 million, or EPS ($0.15), in the
first quarter of 2001 and a net loss attributable to common shareholders of
$11.5 million, or EPS ($0.38), in the second quarter of 2000.
Net income for the six-month period ended June 30, 2001 was $1.3 million, or
diluted EPS $0.02, compared with net income of $4.0 million, or diluted EPS
$0.05, for the same period in 2001, excluding deferred stock compensation,
warrant issuances, a dividend related to warrant issuances and a write down to
inventories which occurred in the first quarter of 2001.
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Including these non-cash items, net loss attributable to common shareholders for
the six-month period ended June 30, 2001 was $5.3 million, or EPS ($0.17),
compared with a net loss attributable to common shareholders of $11.1 million,
or EPS ($0.37), for the same period in 2000.
Dr. Richard Nottenburg, Multilink's Co-Chairman, President and Chief Executive
Officer commented on the quarter, "We have successfully completed an IPO and are
pleased with our second quarter results, especially in light of the tough
operating environment within the industry. We believe our improved results
reflect the diversity of our product offerings and the market acceptance of our
10 Gb/s products. Our continued focus on innovative product solutions is
designed to place us in a position to meet the challenges in our industry and to
enable our customers to realize the benefits of outsourcing."
Additional Highlights
. Completed a successful initial public offering on June 21, 2001 of 9.2
million shares priced at $9 per share. The IPO raised approximately $77
million which included the underwriters' exercise of all of their over
allotment of 1.2 million shares of Multilink common stock
. Increased global headcount by 58 employees to 420 people by June 30, 2001
with significant growth in product development, application engineering, and
direct sales focused on further building customer relationships
. Established North American sales offices in California, Texas, Pennsylvania,
Massachusetts and Canada. In addition to its six current locations in Europe
and the Middle East, Multilink is in the process of opening three additional
international sales offices
Management will be holding a conference call to discuss quarterly results today,
July 24, 2001, at 5:00 pm EDT. You may access the conference call via a web
broadcast on Multilink's website at http://www.mltc.com under the Investor
Relations section.
About Multilink:
Multilink Technology Corporation designs, develops and markets advanced mixed
signal integrated circuits, modules, VLSI products and higher-level assemblies
designed to enable the next generation of high-speed optical networking systems.
By providing our customers with sophisticated products developed by utilizing
systems level expertise and a high level of component integration, we facilitate
our customers' ability to meet their time-to-market requirements. Our products
span the markets from Metro to Ultra Long Haul optical transport equipment with
a focus on the fastest commercially available speeds of 10 Gb/s and higher.
Multilink is headquartered in Somerset, New Jersey with additional offices
located throughout North America and Europe.
Safe Harbor Statement under the Private Securities Litigation Reform Act of
1995:
This release and our comments during the conference call may contain forward-
looking statements that are based on our current expectations, estimates and
projections about our industry, and reflect management's beliefs and certain
assumptions made by us based upon information available to us at this time.
Words such as "anticipates," "expects," "intends," "plans," "believes," "seeks,"
"estimates," "may," "will" and variations of these words or similar expressions
are intended to identify forward-looking statements. In addition, any statements
that refer to expectations, projections or other characterizations of future
events or circumstances, including any underlying assumptions, are forward-
looking statements. These statements speak only as of the date hereof. Such
information is subject to change, and we will not necessarily inform you of such
changes. These statements are not guarantees of future performance and
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are subject to risks, uncertainties and assumptions that are difficult to
predict. Therefore, our actual results could differ materially and adversely
from those expressed in any forward-looking statements as a result of various
factors.
Important factors that may cause such a difference for Multilink include, but
are not limited to, general economic conditions and specific conditions in the
markets we address, including the recent significant economic slowdown in the
technology sector and semiconductor industry; the timing, rescheduling or
cancellation of significant customer orders; the loss of a key customer; our
ability to specify, develop or acquire, complete, introduce, market and
transition to volume production new products and technologies in a timely
manner; the timing of customer-industry qualification and certification of our
products and the risks of non-qualification or non-certification; the rate at
which our present and future customers and end-users adopt Multilink's
technologies and products in our target markets; delays in the adoption and
acceptance of industry standards in those markets; the qualification,
availability and pricing of competing products and technologies and the
resulting effects on revenues and pricing of our products; our ability to retain
and hire key executives, technical personnel and other employees in the numbers,
with the capabilities, and at the compensation levels needed to implement our
business and product plans; our ability to protect our intellectual property;
the availability and pricing of foundry and assembly capacity and raw materials;
fluctuations in the manufacturing yields of our third party semiconductor
foundries and other problems or delays in the fabrication, assembly, testing or
delivery of our products; the risks of producing products with new suppliers and
at new fabrication and assembly facilities; the effects of new and emerging
technologies; the risks and uncertainties associated with our international
operations; changes in our product or customer mix; the quality of our products
and any remediation costs; the level of orders received that can be shipped in a
fiscal quarter; and other factors.
Our forthcoming Quarterly Reports on Form 10-Q, our Registration Statement on
Form S-1 and our other SEC filings discuss some of the important risk factors
that may affect our business, results of operations and financial condition. We
undertake no obligation to revise or update publicly any forward-looking
statements for any reason.
- Tables Follow -
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Multilink Technology Corporation
Consolidated Statement of Operations
(Unaudited - 000's)
Three Months Ended Six Months Ended
June 30, June 30,
----------------------------------------
2001 2000 2001 2000
------- ------- ------- -------
Total Revenues $35,103 $16,320 $66,171 $28,667
Cost of revenues, excluding deferred stock compensation 12,721 6,042 24,070 10,859
Inventory write down - - 4,895 -
Deferred stock compensation 445 132 921 159
------- ------- ------- -------
Total cost of revenues 13,166 6,174 29,886 11,018
------- ------- ------- -------
Gross profit 21,937 10,146 36,285 17,649
Operating expenses:
Research and development, excluding deferred stock
compensation 13,259 5,087 25,795 8,934
Sales and marketing, excluding deferred stock
compensation 4,507 1,328 8,034 2,514
General and administrative, excluding deferred stock
compensation 3,310 884 6,256 2,110
Deferred stock compensation 2,303 1,269 4,884 2,079
Research & development - warrant issuance - 6,375 - 6,375
------- ------- ------- -------
Total operating expenses 23,379 14,943 44,969 22,012
Operating loss (1,442) (4,797) (8,684) (4,363)
Other income and expenses 44 190 159 127
Loss before provision for income taxes (1,398) (4,607) (8,525) (4,236)
Provision (benefit) for income taxes (545) 447 (3,221) 447
Net loss $ (853) $(5,054) $(5,304) $(4,683)
======= ======= ======= =======
Accretion of preferred stock to redemption value - 24 24 48
Dividend related to warrant issuance - 6,375 - 6,375
Net loss per common share
Basic and diluted $ (0.03) $ (0.38) $ (0.17) $ (0.37)
======= ======= ======= =======
Weighted average shares (basic and diluted) 33,688 30,000 31,874 30,000
======= ======= ======= =======
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Multilink Technology Corporation
Reconciliation of Pro forma Net Income and Earnings Per Share
(Unaudited - 000's)
Three Months Ended Six Months Ended
June 30, June 30,
------------------------------------------
2001 2000 2001 2000
------- -------- ------- --------
Net loss attributable to common shareholders $ (853) $(11,453) $(5,328) $(11,106)
======= ======== ======= ========
Deferred stock compensation 2,748 1,401 5,805 2,238
Warrant issuances 0 6,375 0 6,456
Accretion of preferred stock to redemption value 0 24 24 48
Dividend related to warrant issuances 0 6,375 0 6,375
Write down to inventories 0 0 4,895 0
Aggregate pro forma tax adjustment (1,071) 0 (4,071) 0
Pro forma net income $ 824 $ 2,722 1,325 4,011
Net loss per common share
Basic and diluted $ (0.03) $ (0.38) $ (0.17) $ (0.37)
======= ======== ======= ========
Pro forma net income per common share:
Basic $ 0.02 $ 0.09 $ 0.04 $ 0.13
======= ======== ======= ========
Diluted $ 0.01 $ 0.03 $ 0.02 $ 0.05
======= ======== ======= ========
Weighted average shares:
Basic 33,688 30,000 31,874 30,000
======= ======== ======= ========
Diluted 80,831 79,502 79,590 73,520
======= ======== ======= ========
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Multilink Technology Corporation
Select Balance Sheet Data
June 30, 2001 and December 31, 2000
(Unaudited - 000's)
2001 2000
June 30 Dec 31
---------- ---------
Cash and cash equivalents $ 90,352 $29,159
Accounts receivable 16,043 13,771
Inventories 18,990 17,264
Property and equipment, net 25,498 17,765
Total current assets $134,083 $66,731
Total assets $168,027 $90,266
Accounts payable $ 10,075 $10,987
Current liabilities $ 26,955 $25,083
Long term obligations, net of current 1,624 1,018
Redeemable convertible preferred stock 0 55,073
Total shareholders' equity $139,448 $ 9,092
Total liabilities and shareholders' equity $168,027 $90,266
A/R days (DSO) 42 49
Inventory days (DOS) 136 169
For more information, please contact:
Richard Sawchak, Director-Investor Relations
Multilink Technology Corporation
300 Atrium Drive, 2nd Floor
Somerset, New Jersey 08873
Tel: (732) 537-3771
Fax: (732) 537-3781
Email: investors@mltc.com
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