6-K 1 0001.txt ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 6-K REPORT OF FOREIGN ISSUER PURSUANT TO RULE 13A-16 OR 15D-16 OF THE SECURITIES EXCHANGE ACT OF 1934 For the month of October 2000 Ceragon Networks Ltd. -------------------------------------------------------------------------------- (Translation of registrant's name into English) 24 Raoul Wallenberg Street, Tel Aviv 69719, Israel -------------------------------------------------------------------------------- (Address of principal executive office) Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F. Form 20-F X Form 40-F --- --- Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes No X --- --- NY2:\978717\01\KZ6L01!.DOC\47958.0003 The following are included in this Report on Form 6-K: 1. Press release dated October 24, 2000. 2 CERAGON NETWORKS LOGO FOR IMMEDIATE RELEASE --------------------- CERAGON NETWORKS LTD. ANNOUNCES RECORD THIRD QUARTER RESULTS REVENUE INCREASES 56% FROM Q2 OF 2000 TEL AVIV, ISRAEL, OCTOBER 24, 2000--Ceragon Networks Ltd. (NASDAQ: CRNT), a global provider of high-capacity broadband wireless systems for next generation communications networks, today announced record results for the third quarter, which ended September 30, 2000. Revenues for the third quarter hit a record at $8.3 million, rising 56.3% from Q2 of 2000 and representing a 538% increase over revenues of $1.3 million in the third quarter of 1999. The rapid revenue growth reflects the company's capitalization on the emerging global demand for broadband networks. Ceragon Networks' successful IPO was completed on August 4th, 2000 and raised approximately $98 million. Gross profit(*) in the third quarter was $3.6 million, or 43.2% of revenues, compared to a gross profit of $0.2 million, or 15.7% of revenues, in the third quarter of 1999. Net loss for the third quarter of 2000 was $0.8 million, or $0.04 basic and diluted net loss per ordinary share, compared to $1.5 million, or $0.15 basic and diluted net loss per ordinary share for the third quarter of 1999. This compares to a net loss in the second quarter of 2000 of $1.1 million, or $0.08 basic and diluted net loss per ordinary share. Revenues for the first nine months of the year increased to $16.9 million from $ 2.2 million in the first nine months of 1999. Gross profit for the first nine months was $7.2 million, or 42.7% of revenues, compared to a gross profit of $0.3 million, or 15.0% of revenues, in the first nine months of 1999. Net loss for the first nine months of 2000 was $3.1 million, or $0.21 basic and diluted net loss per ordinary share. Net loss for the first nine months of 1999 was $3.9 million, or $0.59 basic and diluted net loss per ordinary share. (*) Gross profit, net loss and net loss per share are pro-forma (see note 1). (MORE) CERAGON NETWORKS RECORD Q3 RESULTS--2 "The increased global demand for high-capacity connectivity is favorably reflected in our financial performance," said Shraga Katz, president and CEO, Ceragon Networks. "Our financial success reflects a precise execution of our strategy as shown by our industry leading gross margin. We have clearly identified and seized a business opportunity in this market and are accelerating the company's growth by increasing our manufacturing capacity and R&D activities. "We have been able to increase revenues by strengthening our strategic relationships with companies such as Nortel and Siemens, and by expanding commercial deployments worldwide with leading service providers such as FirstMark Communications," continued Katz. "A key differentiator for Ceragon is our broad customer base, which spans North America, Europe and Asia-Pacific." NOTE 1 - PRO-FORMA FINANCIAL PRESENTATION Pro-forma results are presented for informational purposes only. Pro-forma financial results exclude the effect of stock-based, non-cash deferred compensation expense and exclude the effect of non-cash dividend related to convertible preferred shares. ABOUT CERAGON NETWORKS LTD. --------------------------- Ceragon Networks Ltd. is a pacesetter in broadband wireless networking systems, enabling high-capacity connectivity in metropolitan areas. Uniquely designed for high-growth, global communications service providers to generate immediate revenue, Ceragon's commercially proven intelligent broadband network solutions support high-speed Internet access and integrated data, video and voice services. Ceragon's FibeAir product family operates across multiple licensed frequencies from 18 to 38 GHz while complying with North American and International standards and delivering IP, SONET/SDH and ATM broadband networks. Ceragon's products enable quick and cost-effective connections for capacity constrained business customers within their own networks, or as a gateway onto the backbone infrastructure. Founded in 1996, Ceragon is headquartered in Tel Aviv, Israel, with North American headquarters in New Jersey and European Headquarters in the UK. More information is available at www.ceragon.com. Ceragon Networks - the shape of next generation networks. (MORE) 2 CERAGON NETWORKS RECORD Q3 RESULTS--3
CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS OF U.S. DOLLARS, EXCEPT PER SHARE DATA) PROFORMA (*) FOR THE THREE MONTHS FOR THE NINE MONTHS ENDED SEPTEMBER 30 ENDED SEPTEMBER 30 ------------------ ------------------ 1999 2000 1999 2000 ---- ---- ---- ---- (UNAUDITED) ----------------------------------------------------- Revenues $ 1,307 $ 8,345 $ 2,166 $ 16,881 Cost of revenues 1,101 4,742 1,842 9,669 --------- ---------- --------- ---------- Gross profit 206 3,603 324 7,212 --------- ---------- --------- ---------- Operating expenses Research and development 1,391 2,922 3,530 6,497 Less: participation by the Chief Scientist of the Government of Israel 394 598 1,096 1,761 --------- ---------- --------- ---------- Research and development, net 997 2,324 2,434 4,736 --------- ---------- --------- ---------- Marketing and selling 580 2,393 1,389 5,438 General and administrative 142 541 335 1,170 --------- ---------- --------- ---------- Total operating expenses 1,719 5,258 4,158 11,344 --------- ---------- --------- ---------- Operating loss (1,513) (1,655) (3,834) (4,132) Financing income (expenses), net 50 863 (72) 1,060 --------- ---------- --------- ---------- Net loss $ (1,463)$ (792) $ (3,906) $ (3,072) ========= ========== ========= ========== Net loss attributable to ordinary shareholders (1,463) (792) (3,906) (3,072) Basic and diluted net loss per ordinary share $ (0.15)$ (0.04) $ (0.59) $ (0.21) ========= ========== ========= ========== Weighted average number of ordinary shares outstanding 9,670,562 18,377,620 6,627,335 14,779,027 ========= ========== ========= ==========
(*) Pro-forma results are presented for informational purposes only. Pro-forma financial results exclude the effect of stock-based non-cash deferred compensation expense and exclude the effect of non-cash dividend related to convertible preferred shares. (MORE) 3
CERAGON NETWORKS RECORD Q3 RESULTS--4 BALANCE SHEET (IN THOUSANDS OF U.S DOLLARS, EXCEPT PER SHARE DATA) DECEMBER 31 SEPTEMBER 30 1999 2000 ----------- ------------ (AUDITED) (Unaudited) Current assets Cash and cash equivalents $ 1,149 83,893 Short-term deposits - 10,084 Trade receivables, net 1,851 6,588 Other receivables 688 3,032 Inventories 2,723 14,599 ----------- ------------ Total current assets 6,411 118,196 ----------- ------------ Property and equipment Cost 1,963 5,655 Less - accumulated depreciation 673 1,125 ----------- ------------ 1,290 4,530 ----------- ------------ Deposits with insurance companies 237 425 ----------- ------------ Total assets $ 7,938 123,151 =========== ============ Current liabilities Trade payables $ 1,850 7,766 Other payables and accrued expenses 1,196 3,124 ----------- ------------ Total current liabilities 3,046 10,890 ----------- ------------ Long-term liabilities Loan from related party 1,173 - Accrued severance pay 389 830 ----------- ------------ Total long-term liabilities 1,562 830 ----------- ------------ Total liabilities 4,608 11,720 ----------- ------------ Commitments Shareholders' equity Share capital Ordinary shares of NIS 0.01 par value: Authorized - as of December 31, 1999 and September 30, 2000 17,500,000 and 57,500,000 shares respectively; issued and outstanding as of December 31, 1999 and September 30, 2000 5,240,750 16 52 and 20,517,521 shares, respectively Preferred shares of NIS 0.01 par value: Authorized - as of December 31, 1999 and September 30, 2000 20,000,000 and none shares respectively; issued and outstanding as of December 31, 1999 and September 30, 2000 5,052,000 and none shares, respectively 12 - Additional paid-in capital 25,471 170,200 Deferred compensation (10,272) (14,462) Accumulated deficit (11,897) (44,359) ----------- ------------ Total shareholders' equity 3,330 111,431 ----------- ------------ Total liabilities and shareholders' equity $ 7,938 123,151 =========== ============
(MORE) 4 CERAGON NETWORKS RECORD Q3 RESULTS--5
CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS OF U.S. DOLLARS, EXCEPT PER SHARE DATA) For the three months For the nine months ended September 30 ended September 30 -------------------- ------------------- 1999 2000 1999 2000 ---- ---- ---- ---- (Unaudited) ----------------------------------------------------- Revenues $ 1,307 $ 8,345 $ 2,166 $ 16,881 Cost of revenues 1,101 4,742 1,842 9,669 --------- ---------- --------- ---------- Gross profit before non-cash compensation 206 3,603 324 7,212 expense Non cash compensation expense 17 170 48 437 --------- ---------- --------- ---------- Gross profit 189 3,433 276 6,775 --------- ---------- --------- ---------- Operating expenses Research and development, net of non-cash compensation expense of $49, $1,006, $123, 1,391 2,922 3,530 6,497 $2,526 Less: participation by the Chief Scientist of the Government of Israel 394 598 1,096 1,761 --------- ---------- --------- ---------- Research and development, net 997 2,324 2,434 4,736 --------- ---------- --------- ---------- Marketing and selling, net of non-cash compensation expense of $209, $818, $315, $2,333 580 2,393 1,389 5,438 General and administrative, net of non cash compensation expense of $338, $769, $337, $1,766 142 541 335 1,170 Amortization of deferred compensation 596 2,593 775 6,625 --------- ---------- --------- ---------- Total operating expenses 2,315 7,851 4,933 17,969 --------- ---------- --------- ---------- Operating loss (2,126) (4,418) (4,657) (11,194) Financing income (expenses), net 50 863 (72) 1,060 --------- ---------- --------- ---------- Net loss $ (2,076)$ (3,555) $ (4,729) $ (10,134) ========= ========== ========= ========== Dividend related to convertible preferred shares - - - (22,328) Net loss attributable to ordinary shareholders (2,076) (3,555) (4,729) (32,462) Basic and diluted net loss per ordinary share $ (0.21)$ (0.19) $ (0.71) $ (2.20) ========= ========== ========= ========== Weighted average number of ordinary shares outstanding 9,670,562 18,377,620 6,627,335 14,779,027 ========= ========== ========= ==========
(MORE) 5 CERAGON NETWORKS RECORD Q3 RESULTS--6 Certain statements concerning Ceragon's future prospects are "forward-looking statements" under the Private Securities Litigation Reform Act of 1995. There can be no assurances that future results will be achieved, and actual results could differ materially from forecasts and estimates. Important factors that could cause actual results to differ materially from forecasts and estimates include: Ceragon's limited operating history and history of losses; Ceragon's dependence on a limited number of key customers, independent manufacturers and suppliers; Ceragon's ability to increase its manufacturing capacity; and the demand for Ceragon's products. These risks and uncertainties, as well as others, are discussed in greater detail in Ceragon's filings with the Securities and Exchange Commission. Ceragon makes no commitment to revise or update any forward-looking statements in order to reflect events or circumstances after the date any such statement is made. Contacts: Brad Ritter GAJ Services Inc. 740-363-2141 britter@gajservices.com ----------------------- Shimon Gal (Investors) Ceragon Networks Ltd. 972-3-766-4295 ir@ceragon.com -------------- Laura Yatim (Media) Ceragon Networks Ltd. 972-3-765-7560 pr@ceragon.com -------------- ### 6 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CERAGON NETWORKS LTD. Date: November 2, 2000 By:/s/ SHIMON GAL -------------------------------- Shimon Gal Chief Financial Officer