CERAGON NETWORKS LTD.
(Translation of registrant’s name into English)
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24 Raoul Wallenberg Street, Tel Aviv 69719, Israel
(Address of principal executive offices)
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CERAGON NETWORKS LTD.
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Date: February 14, 2013
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By:
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/s/ Donna Gershowitz | |
Name: Donna Gershowitz
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Title: VP and General Counsel
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·
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Europe:
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25%
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|
·
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Africa:
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6%
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·
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North America:
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8%
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·
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Latin America:
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32%
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·
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India:
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7%
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·
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APAC:
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22%
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Company and Investor Contact:
Yoel Knoll
Ceragon Networks Ltd.
Tel. +1 (201)-853-0228
yoelk@ceragon.com
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Media Contact:
Abigail Levy-Gurwitz
Ceragon Networks Ltd.
Tel: +1-(201)-853-0271
abigaill@ceragon.com
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Media Contact:
Karen Quatromoni
Rainier Communications
Tel. 508-475-0025 x150
kquatromoni@rainierco.com
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Three months ended
December 31
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Year ended
December 31,
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|||||||||||||||
2012
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2011
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2012
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2011
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|||||||||||||
Revenues
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$ | 106,849 | $ | 118,487 | $ | 446,651 | $ | 445,269 | ||||||||
Cost of revenues
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71,802 | 84,096 | 308,354 | 323,191 | ||||||||||||
Gross profit
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35,047 | 34,391 | 138,297 | 122,078 | ||||||||||||
Operating expenses:
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||||||||||||||||
Research and development, net
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12,007 | 12,534 | 47,487 | 50,456 | ||||||||||||
Selling and marketing
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18,565 | 20,540 | 77,326 | 81,716 | ||||||||||||
General and administrative
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6,925 | 8,337 | 27,519 | 26,524 | ||||||||||||
Restructuring costs
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4,608 | - | 4,608 | 7,834 | ||||||||||||
Acquisition related costs
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- | - | - | 4,919 | ||||||||||||
Total operating expenses
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$ | 42,105 | $ | 41,411 | $ | 156,940 | $ | 171,449 | ||||||||
Operating loss
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(7,058 | ) | (7,020 | ) | (18,643 | ) | (49,371 | ) | ||||||||
Financial expenses, net
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938 | 1,024 | 3,547 | 2,024 | ||||||||||||
Loss before taxes
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(7,996 | ) | (8,044 | ) | (22,190 | ) | (51,395 | ) | ||||||||
Taxes on income
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405 | 123 | 1,201 | 2,259 | ||||||||||||
Net loss
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$ | (8,401 | ) | $ | (8,167 | ) | $ | (23,391 | ) | $ | (53,654 | ) | ||||
Basic net loss per share
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$ | (0.23 | ) | $ | (0.23 | ) | $ | (0.64 | ) | $ | (1.49 | ) | ||||
Diluted net loss per share
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$ | (0.23 | ) | $ | (0.23 | ) | $ | (0.64 | ) | $ | (1.49 | ) | ||||
Weighted average number of shares used in computing basic net loss per share
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36,565,168 | 36,241,106 | 36,457,989 | 35,975,434 | ||||||||||||
Weighted average number of shares used in computing diluted net loss per share
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36,565,168 | 36,241,106 | 36,457,989 | 35,975,434 |
December 31,
2012
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December
31, 2011
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|||||||
ASSETS
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||||||||
CURRENT ASSETS:
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||||||||
Cash and cash equivalents
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$ | 47,099 | $ | 28,991 | ||||
Short-term bank deposits
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422 | 7,159 | ||||||
Marketable securities
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- | 9,665 | ||||||
Trade receivables, net
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149,120 | 143,247 | ||||||
Deferred taxes, net
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8,589 | 8,622 | ||||||
Other accounts receivable and prepaid expenses
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38,901 | 37,281 | ||||||
Inventories
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65,554 | 93,465 | ||||||
Total current assets
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309,685 | 328,430 | ||||||
LONG-TERM INVESTMENTS:
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||||||||
Long-term marketable securities
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4,068 | 3,716 | ||||||
Severance pay funds and pension
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7,163 | 6,360 | ||||||
Total long-term investments
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11,231 | 10,076 | ||||||
OTHER ASSETS:
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||||||||
Long-term receivables
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4,964 | 5,257 | ||||||
Deferred taxes, net
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9,140 | 8,898 | ||||||
Goodwill and intangible assets, net
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25,644 | 28,032 | ||||||
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||||||||
Total other assets
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39,748 | 42,187 | ||||||
PROPERTY AND EQUIPMENT, NET
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33,642 | 30,465 | ||||||
Total assets
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$ | 394,306 | $ | 411,158 | ||||
LIABILITIES AND SHAREHOLDERS' EQUITY
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||||||||
CURRENT LIABILITIES:
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||||||||
Short term loan, including current maturities of long term bank loan
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$ | 25,232 | $ | 8,232 | ||||
Trade payables
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102,079 | 77,395 | ||||||
Deferred revenues
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16,719 | 38,308 | ||||||
Other accounts payable and accrued expenses
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36,642 | 49,508 | ||||||
Total current liabilities
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180,672 | 173,443 | ||||||
LONG-TERM LIABILITIES
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||||||||
Long term bank loan, net of current maturities
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18,536 | 26,768 | ||||||
Accrued severance pay and pension
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12,311 | 11,996 | ||||||
Other long term payables
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38,920 | 37,900 | ||||||
69,767 | 76,664 | |||||||
SHAREHOLDERS' EQUITY:
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||||||||
Share capital:
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||||||||
Ordinary shares
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98 | 97 | ||||||
Additional paid-in capital
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318,106 | 311,911 | ||||||
Treasury shares at cost
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(20,091 | ) | (20,091 | ) | ||||
Other comprehensive loss
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(332 | ) | (343 | ) | ||||
Accumulated deficits
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(153,914 | ) | (130,523 | ) | ||||
Total shareholders' equity
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143,867 | 161,051 | ||||||
Total liabilities and shareholders' equity
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$ | 394,306 | $ | 411,158 |
Three months ended
December 31,
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Year ended
December 31,
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|||||||||||||||
2012
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2011
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2012
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2011
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Cash flow from operating activities:
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||||||||||||||||
Net loss
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$ | (8,401 | ) | $ | (8,167 | ) | $ | (23,391 | ) | $ | (53,654 | ) | ||||
Adjustments to reconcile net loss to net cash used in operating activities:
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||||||||||||||||
Depreciation and amortization
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3,802 | 4,497 | 15,030 | 14,393 | ||||||||||||
Stock-based compensation expense
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1,219 | 2,031 | 5,464 | 6,564 | ||||||||||||
Decrease (Increase) in trade and other receivables, net
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27,610 | 6,930 | (11,911 | ) | 3,440 | |||||||||||
Decrease (Increase) in inventory, net of write off
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(1,598 | ) | 7,617 | 27,210 | 40,643 | |||||||||||
Increase (decrease) in trade payables and accrued liabilities
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1,635 | (1,706 | ) | 19,073 | (17,600 | ) | ||||||||||
Increase in Goodwill
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(1,365 | ) | - | (1,365 | ) | - | ||||||||||
Decrease in deferred revenues
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(5,170 | ) | (42 | ) | (21,589 | ) | (11,925 | ) | ||||||||
Increase in deferred tax asset, net
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(324 | ) | (1,269 | ) | (743 | ) | (1,237 | ) | ||||||||
Other adjustments
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(323 | ) | (2,455 | ) | (569 | ) | (749 | ) | ||||||||
Net cash provided by (used in) operating activities
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$ | 17,085 | $ | 7,436 | $ | 7,209 | $ | (20,125 | ) | |||||||
Cash flow from investing activities:
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||||||||||||||||
Purchase of property and equipment ,net
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(4,317 | ) | (4,696 | ) | (14,530 | ) | (14,447 | ) | ||||||||
Payment for business acquisition *)
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- | - | - | (42,405 | ) | |||||||||||
Investment in short and long-term bank deposit
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- | - | (1,266 | ) | (7,304 | ) | ||||||||||
Proceeds from maturities of short and long-term bank deposits
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- | 2,368 | 7,920 | 25,664 | ||||||||||||
Investment in available for sale marketable securities
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- | - | (64 | ) | - | |||||||||||
Proceeds from sales of available for sale marketable securities
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- | 201 | 9,781 | 10,459 | ||||||||||||
Net cash provided by (used in) investing activities
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$ | (4,317 | ) | $ | (2,127 | ) | $ | 1,841 | $ | (28,033 | ) | |||||
Cash flow from financing activities:
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||||||||||||||||
Proceeds from exercise of options
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2 | 518 | 736 | 4,474 | ||||||||||||
Proceeds from financial institutions, net
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(8,000 | ) | - | 17,000 | 35,000 | |||||||||||
Repayments of bank loans
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(2,058 | ) | - | (8,232 | ) | - | ||||||||||
Net cash provided by (used in) financing activities
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$ | (10,056 | ) | $ | 518 | $ | 9,504 | $ | 39,474 | |||||||
Translation adjustments on cash and cash equivalents
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$ | 36 | $ | 223 | $ | (446 | ) | $ | (50 | ) | ||||||
Increase (Decrease) in cash and cash equivalents
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$ | 2,748 | $ | 6,050 | $ | 18,108 | $ | (8,734 | ) | |||||||
Cash and cash equivalents at the beginning of the period
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44,351 | 22,941 | 28,991 | 37,725 | ||||||||||||
Cash and cash equivalents at the end of the period
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$ | 47,099 | $ | 28,991 | $ | 47,099 | $ | 28,991 |
Three months ended December 31,
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||||||||||||||||
2012
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2011
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|||||||||||||||
GAAP (as reported)
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Adjustments
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Non-GAAP
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Non-GAAP
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|||||||||||||
Revenues
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$ | 106,849 | $ | 106,849 | $ | 118,487 | ||||||||||
Cost of revenues
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71,802 |
(a) 495
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71,307 | 79,356 | ||||||||||||
Gross profit
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35,047 | 35,542 | 39,131 | |||||||||||||
Operating expenses:
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Research and development, net
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12,007 |
(b) 1,468
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10,539 | 11,908 | ||||||||||||
Selling and marketing
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18,565 |
(c) 1,221
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17,344 | 17,936 | ||||||||||||
General and administrative
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6,925 |
(d) 1,030
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5,895 | 5,872 | ||||||||||||
Restructuring costs
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4,608 | 4,608 | - | - | ||||||||||||
Total operating expenses
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$ | 42,105 | $ | 33,778 | $ | 35,716 | ||||||||||
Operating profit (loss)
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(7,058 | ) | 1,764 | 3,415 | ||||||||||||
Financial expenses, net
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938 | 938 | 1,024 | |||||||||||||
Income (loss) before taxes
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(7,996 | ) | 826 | 2,391 | ||||||||||||
Taxes on income
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405 | 405 | 123 | |||||||||||||
Net income (loss)
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$ | (8,401 | ) | $ | 421 | $ | 2,268 | |||||||||
Basic net earnings (loss) per share
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$ | (0.23 | ) | $ | 0.01 | $ | 0.06 | |||||||||
Diluted net earnings (loss) per share
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$ | (0.23 | ) | $ | 0.01 | $ | 0.06 | |||||||||
Weighted average number of shares used in computing basic net earnings (loss) per share
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36,565,168 | 36,565,168 | 36,241,106 | |||||||||||||
Weighted average number of shares used in computing diluted net earnings (loss) per share
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36,565,168 | 36,641,920 | 37,504,556 | |||||||||||||
Total adjustments
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8,822 |
(a)
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Cost of revenues includes $0.3 million of amortization of intangible assets, $0.1 million of inventory step-up, $(0.1) million of changes in pre-acquisition indirect tax positions and $0.2 million of restructuring and other charges related to reduction in workforce in the three months ended December 31, 2012.
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(b)
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Research and development expenses include $1.2 million of restructuring and other charges related to reduction in workforce and $0.2 million of stock based compensation expenses in the three months ended December 31, 2012.
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(c)
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Selling and marketing expenses includes $0.5 million of amortization of intangible assets, $0.3 million of restructuring and other charges related to reduction in workforce and $0.4 million of stock based compensation expenses in the three months ended December 31, 2012.
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(d)
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General and administrative expenses include $0.4 million of restructuring and other charges related to reduction in workforce and $0.6 million of stock based compensation expenses in the three months ended December 31, 2012.
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Year ended December 31,
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||||||||||||||||
2012
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2011
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|||||||||||||||
GAAP (as reported)
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Adjustments
|
Non-GAAP
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Non-GAAP
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|||||||||||||
Revenues
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$ | 446,651 | $ | 446,651 | $ | 445,269 | ||||||||||
Cost of revenues
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308,354 |
(a) 8,573
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299,781 | 300,984 | ||||||||||||
Gross profit
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138,297 | 146,870 | 144,285 | |||||||||||||
Operating expenses:
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||||||||||||||||
Research and development, net
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47,487 |
(b) 2,903
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44,584 | 46,425 | ||||||||||||
Selling and marketing
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77,326 |
(c) 5,020
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72,306 | 71,686 | ||||||||||||
General and administrative
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27,519 |
(d) 2,352
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25,167 | 21,484 | ||||||||||||
Restructuring costs
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4,608 | 4,608 | - | - | ||||||||||||
Total operating expenses
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$ | 156,940 | $ | 142,057 | $ | 139,595 | ||||||||||
Operating profit (loss)
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(18,643 | ) | 4,813 | 4,690 | ||||||||||||
Financial expenses, net
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3,547 | 3,547 | (2,024 | ) | ||||||||||||
Income (loss) before taxes
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(22,190 | ) | 1,266 | 2,666 | ||||||||||||
Taxes on income
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1,201 | 1,201 | 2,259 | |||||||||||||
Net income (loss)
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$ | (23,391 | ) | $ | 65 | $ | 407 | |||||||||
Basic net earnings (loss) per share
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$ | (0.64 | ) | $ | 0.00 | $ | 0.01 | |||||||||
Diluted net earnings (loss) per share
|
$ | (0.64 | ) | $ | 0.00 | $ | 0.01 | |||||||||
Weighted average number of shares used in computing basic net earnings (loss) per share
|
36,457,989 | 36,457,989 | 35,975,434 | |||||||||||||
Weighted average number of shares used in computing diluted net earnings (loss) per share
|
36,457,989 | 37,092,887 | 37,522,665 | |||||||||||||
Total adjustments
|
23,456 |
(a)
|
Cost of revenues includes $1.2 million of amortization of intangible assets, $4.5 million of inventory step-up, $2.3 million of changes in pre-acquisition indirect tax positions, $0.2 million of stock based compensation expenses and $0.4 million of restructuring, integration plan related costs and other charges related to reduction in workforce in the year ended December 31, 2012.
|
(b)
|
Research and development expenses include $1.3 million of restructuring, integration plan related costs and other charges related to reduction in workforce and $1.6 million of stock based compensation expenses in the year ended December 31, 2012.
|
(c)
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Selling and marketing expenses includes $2.3 million of amortization of purchased intangible assets, $0.7 million of restructuring, integration plan related costs and other charges related to reduction in workforce and $2.0 million of stock based compensation expenses in the year ended December 31, 2012.
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(d)
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General and administrative expenses include $0.7 million of restructuring, integration plan related costs and other charges related to reduction in workforce and $1.7 million of stock based compensation expenses in the year ended December 31, 2012.
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Three months ended
|
Year ended
|
|||||||
December 31, 2012
|
||||||||
Reported GAAP net operating loss
|
(7,058 | ) | (18,643 | ) | ||||
Stock based compensation expenses
|
1,219 | 5,464 | ||||||
Amortization of purchased intangible assets
|
880 | 3,536 | ||||||
Inventory step up
|
93 | 4,511 | ||||||
Restructuring and other charges related to reduction in workforce
|
6,712 | 6,712 | ||||||
Integration plan related costs
|
- | 955 | ||||||
Changes in pre-acquisition indirect tax positions
|
(82 | ) | 2,277 | |||||
Non-GAAP net operating profit
|
1,764 | 4,812 |
Three months |
Three months
|
Three months
|
||||||||||
Ended
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Ended |
Ended
|
||||||||||
March 31, 2012
|
June 30, 2012
|
September 30, 2012
|
||||||||||
Revenues - as reported
|
$ | 117,783 | $ | 119,050 | $ | 118,046 | ||||||
Revenues - as adjusted
|
110,046 | 112,669 | 117,087 | |||||||||
Gross Profit - as reported
|
36,939 | 37,969 | 36,570 | |||||||||
Gross Profit - as adjusted
|
32,809 | 35,913 | 34,528 | |||||||||
Basic and diluted net loss per share - as reported
|
$ | (0.10 | ) | $ | (0.03 | ) | $ | (0.07 | ) | |||
Basic and diluted net loss per share - as adjusted
|
$ | (0.20 | ) | $ | (0.08 | ) | $ | (0.13 | ) |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except share and per share data)
(Unaudited – non-GAAP)
|
Three months
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Three months
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Three months
|
||||||||||
Ended
|
Ended
|
Ended
|
||||||||||
March 31, 2012
|
June 30, 2012
|
September 30, 2012
|
||||||||||
Revenues - as reported
|
$ | 117,783 | $ | 119,050 | $ | 118,046 | ||||||
Revenues - as adjusted
|
110,046 | 112,669 | 117,087 | |||||||||
Gross Profit - as reported
|
39,231 | 40,194 | 40,681 | |||||||||
Gross Profit - as adjusted
|
35,106 | 37,284 | 38,938 | |||||||||
Basic and diluted net loss per share - as reported
|
$ | 0.05 | $ | 0.08 | $ | 0.09 | ||||||
Basic and diluted net loss per share - as adjusted
|
$ | (0.06 | ) | $ | 0.01 | $ | 0.04 |