-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, NCCFxWeAvQEPqe3evfMC9XfmbB0E0FuwVWWfXKygwMp3PMrQu74+u+ZwgAg967g2 V3TYTFZhiSUxTPc+5hbqFA== 0000928385-02-003422.txt : 20021030 0000928385-02-003422.hdr.sgml : 20021030 20021030145021 ACCESSION NUMBER: 0000928385-02-003422 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20021030 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: FILED AS OF DATE: 20021030 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ACTERNA CORP CENTRAL INDEX KEY: 0000030841 STANDARD INDUSTRIAL CLASSIFICATION: INSTRUMENTS FOR MEAS & TESTING OF ELECTRICITY & ELEC SIGNALS [3825] IRS NUMBER: 042258582 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-12657 FILM NUMBER: 02802955 BUSINESS ADDRESS: STREET 1: 3 NEW ENGLAND EXECUTIVE PARK CITY: BURLINGTON STATE: MA ZIP: 01803-5087 BUSINESS PHONE: 6172726100 MAIL ADDRESS: STREET 1: 3 NEW ENGLAND EXECUTIVE PARK CITY: BURLINGTON STATE: MA ZIP: 01803-5087 FORMER COMPANY: FORMER CONFORMED NAME: DYNATECH CORP DATE OF NAME CHANGE: 19920703 8-K 1 d8k.txt FORM 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): October 30, 2002 Acterna Corporation (Exact name of registrant as specified in its charter) Delaware 000-07438 04-2258582 (State or other jurisdiction of (Commission File No.) (IRS Employee incorporation) Identification No.)
12410 Milestone Center Drive Germantown, Maryland 20876 (Address of principal executive offices, including zip code) Registrant's telephone number, including area code: (240) 404-2999 Item 7. Financial Statements and Exhibits. Exhibit 99.1: Press Release, dated October 30, 2002, entitled "Acterna Corporation Reports Second Quarter Results," which release is furnished but not filed as part of Item 9 of this report. Item 9. Regulation FD Disclosure. Attached hereto as Exhibit 99.1 and furnished but not filed is a press release entitled "Acterna Corporation Reports Second Quarter Results." 2 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 hereunto duly authorized. ACTERNA CORPORATION Date: October 30, 2002 By: /s/ John D. Ratliff ------------------------------------- Name: John D. Ratliff Title: Corporate Vice President and Chief Financial Officer 3 EX-99.1 3 dex991.txt EXHIBIT 99.1 EXHIBIT 99.1 For Immediate Release ACTERNA CORPORATION REPORTS SECOND-QUARTER RESULTS GERMANTOWN, MD--October 30, 2002--Acterna Corporation (Nasdaq: ACTR), the parent company of Acterna, Itronix Corporation and da Vinci Systems, reported its results for the second quarter of fiscal 2003, ended September 30, 2002. Net sales for the second quarter of fiscal 2003 were $164 million, down 45 percent from the same period last year and down 4 percent from last quarter, on an as reported basis. Net sales were down 43 percent from $285 million on a pro forma basis (which adjusts for the ICS Advent disposition in October 2001) from the same period last year. Net sales of communications test products were $125 million, which compared to $244 million for same period last year and $136 million in the first quarter of fiscal year 2003. Orders were $189 million in the second quarter, which, on a pro forma basis, were up 10 percent from the same period last year and up 20 percent sequentially. Communications test orders were $112 million, down 6 percent from the previous quarter, and down 27 percent from the same period last year. Itronix orders were significant in the quarter at $73 million, compared to $33 million last quarter and $14 million in the same period last year, primarily as a result of a large order from Sears, Roebuck and Co. For the second quarter of fiscal 2003, the company reported a net loss of $284 million, or a loss of $1.48 per share, which includes a restructuring charge of $19 million and several one-time gains and charges. The restructuring charge resulted from severance and outplacement costs associated with Acterna's previously announced cost-cutting initiatives and charges for facilities the company has previously said it will close. The one-time gains and charges also include the following items: . a gain of $75 million, net of tax of $50 million, on the sale of Airshow to Rockwell Collins on August 9, 2002; . a gain of $50 million, net of tax of $28 million and net of a small loss on the retirement of senior debt, on the company's successful tender of $106 million of its 9.75 percent bonds; . a loss of $2.6 million, net of tax benefit of $2.2 million, from discontinued operations; . a charge of $388 million for goodwill and other asset impairment in the communications test unit; and . an excess inventory charge of $14.5 million, which is comprised of $9.5 million of inventory reserves and $5 million of purchase commitments related to suppliers, and is primarily related to the optical transport business. The company also reported a tax benefit from the loss from continuing operations of $49 million. Excluding all special gains and charges, except for the restructuring charge, and excluding the tax benefit from continuing operations, the loss per share is $0.28, within the guidance of negative $0.26-$0.28 the company provided for the quarter on a comparable basis. For the same period a year ago, the company reported a net loss of $148 million or $0.77 per share. Gross margin for the second quarter was 42 percent, versus 50 percent last quarter and 57 percent for the year ago quarter on a pro forma basis. Adjusting for the $14.5 million inventory charge, gross margin for the quarter was 51 percent. In response to the continued industry downturn and new capital spending reductions recently reported by several key customers, Acterna said it would further reduce its workforce by approximately 350 positions, or 10 percent of its employment base. These reductions are designed to size the company to the lower level of revenue resulting from our customers' continued capital spending reductions. The company expects to realize $40 million in annualized savings and to take a restructuring charge of approximately $20 million related to these actions and the restructuring announced on September 4, 2002. Acterna expects to record $15 million of this charge in the third quarter and the remainder in the fourth quarter of this fiscal year. "We continue to navigate through very difficult market conditions and are taking those steps that we believe best position Acterna for resumed growth when the industry recovery begins," said John Peeler, president of Acterna Corporation. "Cost cutting remains a priority for Acterna as we size our business to reflect declining revenue in our communications test segment" Operating expenses for the quarter were $95 million, down 13 percent sequentially and 36 percent from the same period last year on a comparable basis. As of September 30, 2002, Acterna Corporation's total employment was approximately 3,590 compared to 4,460 at the end of last quarter and 5,900 in the year-ago quarter. The headcount reduction of 870 since the first quarter is comprised of a 460 employee reduction resulting from recently divested businesses and a 410 staff reduction primarily from severance and attrition. As of September 30, 2002, the company had liquidity of $94 million, comprised of $32 million of cash and unused borrowing capacity of $62 million under its $175 million revolving credit facility. The company had total debt of $893 million at the end of the quarter. During the quarter the company reduced its term debt by $234 million, which reduces annual interest expense by $17 million. "The company is focused on improving its balance sheet and preserving liquidity to ensure we can continue to provide the highest quality products and service levels to our customers," said Ned Lautenbach, Acterna Corporation Chairman and CEO. Six Months Results For the first-half of fiscal 2003, net sales were $334 million, compared to net sales of $638 million for the same period last year on an as reported basis. The loss per share for the first six months was $1.69, which compared to a loss per share of $0.80 in the same period the prior year. Third Quarter Fiscal Year 2003 Quarter Management Outlook Management guidance for its third quarter ending December 31, 2002 is revenue of $175 - $185 million and a per share loss of $0.21 - $0.23 on an as reported basis, which includes an estimated $15 million restructuring charge. About Acterna Corporation Based in Germantown, Maryland, Acterna Corporation (NASDAQ: ACTR) is the holding company for Acterna, da Vinci Systems and Itronix. Acterna is the world's second largest communications test and management company. The company offers instruments, systems, software and services used by service providers, equipment manufacturers and enterprise users to test and optimize performance of their optical transport, access, cable, data/IP and wireless networks and services. Itronix sells ruggedized computing devices for field service applications to a range of industries, while da Vinci Systems designs and markets video color correction systems to the video postproduction industry. Additional information on Acterna is available at http://www.acterna.com. This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which statements reflect the company's current judgment on the matters addressed by these statements. However, because such statements apply to future events, they are subject to risks and uncertainties that could cause the actual events and the company's results to differ materially. Important factors that could cause actual events and the company's results to differ materially are described in the company's reports on Form 10-K and 10-Q on file with the Securities and Exchange Commission. Note to Investors and Media Acterna Corporation management will discuss its fourth quarter results on a conference call on Wednesday, October 30 at 7:30 AM EDT. A webcast of the conference call will be available to all interested parties on the Acterna website at www.acterna.com under the "Investor Relations" section. Contact: Investors: Mike Rhine, 240-404-1823 Media: Jim Monroe, 240-404-1922 Acterna Corporation Consolidated Statements of Operations (Unaudited) Dollars in thousands, except per share amounts
Three Months Ended Six Months Ended ----------------------------- -------------------------------- Sept 30, 2002 Sept 30, 2001 Sept 30, 2002 Sept 30, 2001 ------------- ------------- ------------- ------------- Net sales $ 163,941 $ 298,895 $ 334,286 $ 637,814 Cost of sales 95,374 135,460 181,809 283,063 ----------------------------- -------------------------------- Gross margin 68,567 163,435 152,477 354,751 Selling, general & administrative expense 70,555 113,681 151,672 238,528 Product development expense 27,132 40,033 57,746 81,240 Impairment of goodwill and other assets 388,396 17,918 388,396 17,918 Restructuring 19,215 7,045 25,372 7,045 Amortization of intangibles 259 10,599 522 22,151 ----------------------------- -------------------------------- Total operating expenses 505,557 189,276 623,708 366,882 ----------------------------- -------------------------------- Operating loss (436,990) (25,841) (471,231) (12,131) Interest expense (19,257) (24,698) (41,554) (50,976) Interest income 136 893 208 1,377 Other income (expense), net 89 (3,445) (1,387) (5,273) ----------------------------- -------------------------------- Loss from continuing operations before income taxes and extraordinary items (456,022) (53,091) (513,964) (67,003) (Benefit) provision for income taxes (49,342) 84,008 (66,261) 79,119 ----------------------------- -------------------------------- Loss from continuing operations before extraordinary items (406,680) (137,099) (447,703) (146,122) Discontinued operations Loss from discontinued operations, net of tax (2,625) (10,422) (1,513) (7,550) Gain on sale of discontinued operations, net of tax expense of $50,405 74,902 74,902 ----------------------------- -------------------------------- Loss before extraordinary item (334,403) (147,521) (374,314) (153,672) Extraordinary item, gain on early extinguishment of debt, net of tax expense of $27,852 50,082 50,082 ----------------------------- -------------------------------- Net income (loss) (284,321) (147,521) (324,232) (153,672) ============================= ================================ Income (loss) per common share - basic and diluted Continuing operations (2.12) (0.71) (2.33) (0.76) Discontinued operations 0.38 (0.06) 0.38 (0.04) Extraordinary item 0.26 - 0.26 - ----------------------------- -------------------------------- Net loss per common share - basic and diluted ($1.48) ($0.77) ($1.69) ($0.80) ============================= ================================ Weighted average number of common shares - Basic and diluted 192,248 191,889 192,248 191,538 ============================= ================================
Acterna Corporation Consolidated Balance Sheets (Unaudited) Dollars in Thousands
September 30, March 31, 2002 2002 ------------- ------------ ASSETS Cash and cash equivalents $ 32,041 $ 42,739 Accounts receivable, net 98,910 119,246 Inventories, net 92,430 108,739 Deferred income taxes 21,650 18,878 Other current assets 35,429 107,733 Current assets of discontinued operations held for sale 15,430 ----------- ----------- Total current assets 280,460 412,765 Property, plant, and equipment, net 110,670 118,213 Goodwill and other intangible assets, net 34,638 410,750 Other assets 35,583 46,561 Long-term assets of discontinued operations held for sale 26,267 ----------- ----------- Total assets $ 461,351 $ 1,014,556 =========== =========== LIABILITIES & STOCKHOLDERS' DEFICIT Notes payable $ 1,886 $ 2,523 Current portion of long-term debt 18,768 28,937 Accounts payable 51,127 68,262 Other current liabilities 181,868 198,773 Current liabilities of discontinued operations held for sale 10,644 ----------- ----------- Total current liabilities 253,649 309,139 Long-term debt 792,034 979,187 Long-term notes payable 80,319 76,875 Deferred income taxes 19,565 17,581 Other long-term liabilities 69,584 68,549 Total stockholders' deficit (753,800) (436,775) ----------- ----------- Total liabilities and stockholders' deficit $ 461,351 $ 1,014,556 =========== ===========
Acterna Corporation Pro Forma Statement of Operations (Unaudited) Earnings Before Interest, Taxes, and Amortization Excluding Special Charges (EBITA) Dollars in Thousands
Three Months Ended Six Months Ended ------------------------------- -------------------------------- Sept 30, 2002 Sept 30, 2001 Sept 30, 2002 Sept 30, 2001 ------------- ------------- ------------- ------------- Net sales $ 163,941 $ 284,972 $ 334,286 $ 606,102 Cost of sales 95,123 123,456 181,162 255,156 ------------------------------- -------------------------------- Gross margin 68,818 161,516 153,124 350,946 Selling, general & administrative expense 68,351 106,175 145,834 217,879 Product development expense 26,455 37,741 55,996 76,154 Other (income) expense (89) 3,445 1,387 5,273 -------------- ------------- ------------- ------------- 94,717 147,361 203,217 299,306 ------------------------------- -------------------------------- EBITA (25,899) 14,155 (50,093) 51,640 =============================== ================================ Reconciliation to Operating Loss: EBITA (25,899) 14,155 (50,093) 51,640 Charges excluded From EBITA EBITA ICS 0 (2,149) 0 (4,943) Amortization of unearned compensation (2,984) (5,245) (7,707) (11,787) Amortization of intangibles (259) (10,599) (522) (22,151) Impairment of goodwill and other assets (388,396) (17,918) (388,396) (17,918) WWG Restructuring and other Charges 0 (485) 0 (485) One-Time and other Special Charges 0 0 0 (4,715) Restructuring (19,215) (7,045) (25,372) (7,045) Other charges (148) 0 (528) 0 Plus Other (income) expenses (89) 3,445 1,387 5,273 ---------------------------------------------------------------------- Total excluded from EBITA (411,091) (39,996) (421,138) (63,771) ---------------------------------------------------------------------- Operating Loss (436,990) (25,841) (471,231) (12,131) =============================== ================================
Note: This proforma statement of operations excludes the results of Airshow, Inc. which was divested on August 9, 2002, and ICS Advent which was divested on October 31, 2001 Acterna Corporation 2Q Fiscal 2003 EPS Calculation (Unaudited) Dollars in thousands, except per share amounts
Net Loss as reported $(284,321) Special gains and charges: Gain on Sale of Airshow, net of tax of $50,405 (74,902) Gain on extinguishment of debt, net of tax of $27,852 (50,082) Loss on discontinued ops, net of tax of $2,187 2,625 Impairment of goodwill and other assets 388,396 Inventory Charge 14,500 --------- 280,537 Tax benefit from continuing operations (49,342) --------- Net loss excluding special gains and charges and excluding tax benefit on (53,126) loss from continuing operations Weighted Average Number of Common Shares 192,248 Net loss per common share $ (1.48) Net loss per common share excluding special gains and charges and excluding tax benefit on loss from continuing operations $ (0.28)
Acterna Corporation Pro Forma Sales for Continuing Operations by Product Area (Unaudited) Dollars in Millions
Three Months Ended Six Months Ended September 30 September 30 % September 30 September 30 % 2002 2001 Change 2002 2001 Change Optical Transport $ 37.5 $ 126.2 -70.3% $ 86.3 $ 257.8 -66.5% Cable Networks 19.5 19.8 -1.2% 39.9 44.7 -10.7% Access Networks 21.2 26.8 -21.0% 38.3 68.9 -44.4% Data/IP, Wireless, and Other 47.2 71.1 -33.5% 97.1 149.1 -34.9% Communications Networks ----------------------------- ----------------------------- Total Communications Test 125.4 243.9 -48.6% 261.6 520.5 -49.7% da Vinci 5.8 7.2 -19.2% 11.8 15.2 -22.3% Itronix 32.7 33.9 -3.5% 60.9 70.4 -13.6% ----------------------------- ----------------------------- Total Acterna Corporation $ 163.9 $ 285.0 -42.5% $ 334.3 $ 606.1 -44.8% ============================= =============================
Note: Excludes the results of ICS Advent which was sold in October 2001, and Airshow which was sold in August 2002. -----END PRIVACY-ENHANCED MESSAGE-----