EX-99.1 2 ex99-1.htm EX-99.1 EX-99.1
 
 
Exhibit 99.1
For Further Information Contact:
David Renauld
Vice President, Corporate Affairs
(413) 584-1425


FOR IMMEDIATE RELEASE


TERABEAM ANNOUNCES
FOURTH QUARTER AND FULL YEAR 2006 FINANCIAL RESULTS


San Jose, CA, February 28, 2007 - Terabeam, Inc. (NASDAQ:TRBM), a global pioneer and leading developer and supplier of Mesh, WiMAX, Wi-Fi and Millimeter Wave wireless products and solutions, today reported its unaudited financial results for the fourth quarter and year ended December 31, 2006.

Revenue for the quarter ended December 31, 2006 was approximately $18.2 million, a decrease of approximately 33% from the revenue of $27.1 million for the quarter ended December 31, 2005 and an increase of approximately 2% from the revenue of $17.9 million for the quarter ended September 30, 2006. Revenue for the year ended December 31, 2006 was $75.4 million, an increase of approximately 28% from the revenue of $59.0 million for the year ended December 31, 2005.

Operating loss for the quarter ended December 31, 2006 was $2.1 million compared to operating income of $657,000 for the quarter ended December 31, 2005 and an operating loss of $13.7 million for the quarter ended September 30, 2006. Net loss for the quarter ended December 31, 2006 was $2.0 million ($0.09 per share-diluted) compared to net income of $810,000 ($0.04 per share-diluted) for the quarter ended December 31, 2005 and net loss of $13.7 million ($0.63 per share-diluted) for the quarter ended September 30, 2006. The third quarter 2006 operating loss and net loss included non-cash charges totaling approximately $10.4 million (approximately $0.48 per share-diluted), consisting of an inventory reserve of approximately $1.5 million and an impairment charge related to intangible assets of approximately $8.9 million.

The net loss for the year ended December 31, 2006 was $23.2 million ($1.08 per share-diluted), including the previously discussed non-cash charges in the third quarter 2006, compared to a net loss of $11.2 million ($0.51 per share-diluted), including $7.8 million of restructuring provisions and charges as a result of the purchase of the operations of Proxim Corporation, for the year ended December 31, 2005.

Robert Fitzgerald, Terabeam’s Chief Executive Officer, stated, “The fourth quarter of 2006 demonstrates further stabilization of the company. Our product development is on track, and we believe that we have a real winner with the Tsunami 5012 that we introduced in the

 
 
 
Terabeam Announces Fourth Quarter and
Full Year 2006 Financial Results
February 28, 2007
Page 2



fourth quarter. The primary challenge going forward is to build from our base and ramp revenue. With the introduction of MeshMax™ as well as the success we are seeing with our pre-WiMAX, WiMAX and Mesh products, we believe that we are well positioned to deliver sustainable growth.”

Conference Call Information

Terabeam will host a conference call to discuss this release, financial results, developments at the company, and other matters of interest to investors and others on February 28, 2007 starting at 5:00 p.m. Eastern Time. The discussion may include forward-looking information.

To participate in this conference call, please dial 800-210-9006 (or 719-457-2621 for international callers), confirmation code 3496855 for all callers, at least ten minutes before start time. The conference call will also be broadcast live over the Internet. Investors and others are invited to visit Terabeam’s website at http://www.terabeam.com to access this broadcast. Replays will be available telephonically for approximately one week by dialing 888-203-1112 for domestic callers and 719-457-0820 for international callers, confirmation code 3496855 for all callers, and over the Internet for approximately 90 days at Terabeam’s website at http://www.terabeam.com.

About Terabeam
Terabeam, Inc. has two primary subsidiaries Proxim Wireless Corporation and Ricochet Networks, Inc. Proxim Wireless Corporation is a global leader in providing Wi-Fi and other broadband wireless solutions to meet the performance, scalability, and security requirements of enterprises, government, and service providers. Ricochet Networks, Inc. is a leading portable Wireless Internet Service Provider (WISP) with operational markets in Denver and Aurora, Colorado and San Diego, California. Additional information about the company can be found at the company's website located at http://www.terabeam.com or by contacting the company by telephone at 413-584-1425 or by email at IR@terabeam.com.

Safe Harbor Statement
Statements in this press release that are not statements of historical facts are forward-looking statements that involve risks, uncertainties, and assumptions. Terabeam’s actual results may differ materially from the results anticipated in these forward-looking statements. The forward-looking statements involve risks and uncertainties that could contribute to such differences including those relating to and arising from the ongoing uncertainty in the telecommunications industry and larger economy; the intense competition in our industries and resulting impacts on our pricing, gross margins, and general financial performance; difficulties or delays in developing and supplying new products with the contemplated or desired features, performance, compliances, certifications, cost, price, and other characteristics; the difficulties in predicting Terabeam’s future financial performance; and the impacts and effects of any other strategic transactions Terabeam may evaluate or consummate. Further information on these and other factors that could affect Terabeam’s actual results is and will be included in filings made by Terabeam from time to time with the Securities and Exchange Commission and in its other public statements.

- Financial Tables Follow -


 
 
 
Terabeam Announces Fourth Quarter and
Full Year 2006 Financial Results
February 28, 2007
Page 3




TERABEAM, INC.
  
CONSOLIDATED BALANCE SHEETS
  
(in thousands)
  
   
December 31,
  
December 31,
  
   
2006
  
2005
  
Assets
  
(unaudited)
      
Current assets:
              
Cash and cash equivalents
 
$
10,290
  
$
14,133
  
Investment securities - available-for-sale
   
168
    
260
  
Accounts receivable, net
   
5,539
    
8,378
  
Inventory
   
10,142
    
10,070
  
Prepaid expenses
   
1,246
   
1,045
 
Total current assets
   
27,385
    
33,886
  
               
Property and equipment, net
   
2,660
    
3,924
  
Other Assets:
              
Restricted cash
   
76
    
5,076
  
Goodwill
   
7,922
    
7,380
  
Intangible assets, net
   
11,545
    
23,817
  
Deposits and prepaid expenses
    
287
    
675
  
Total other assets
   
19,830
    
36,948
  
Total assets
 
$
49,875
  
$
74,758
  
               
Liabilities and Stockholders’ Equity
              
Current liabilities:
              
Accounts payable and accrued expenses
 
$
13,887
  
$
15,600
  
Deferred revenue
   
2,198
    
2,503
  
License agreement payable - current maturities
    
868
    
981
  
Current maturities of notes payable - other current liabilities
    
-
    
-
  
Total current liabilities
   
16,953
    
19,084
  
               
License agreement payable, net of current maturities
    
2,088
    
2,956
  
Total liabilities
   
19,041
    
22,040
  
Commitments and contingencies
              
               
Stockholders’ Equity
              
Preferred stock, $0.01 par value; authorized 4,500,000, none issued at December 31, 2006 and December 31, 2005
   
-
    
-
  
Common stock, $0.01 par value, 100,000,000 shares authorized, 21,552,572 issued and outstanding at December 31, 2006 and 21,446,217 issued and outstanding at December 31, 2005
   
216
   
214
 
Additional paid-in capital
   
57,976
   
56,638
 
Accumulated deficit
    
(27,285
)
  
(4,122
)
Accumulated other comprehensive income:
              
Net unrealized loss on available-for-sale securities
   
(73
)
  
(12
)
Total stockholders’ equity
   
30,834
    
52,718
  
Total liabilities and stockholders’ equity
 
$
49,875
  
$
74,758
  


 
 
 
Terabeam Announces Fourth Quarter and
Full Year 2006 Financial Results
February 28, 2007
Page 4




 
 
TERABEAM, INC.
  
CONSOLIDATED STATEMENTS OF OPERATIONS
  
(in thousands, except per share data)
  
   
   
For the Three Months Ended
 
For the Year Ended
 
   
December 31,
  
December 31,
  
   
2006
  
2005
  
2006
  
2005
  
   
(unaudited)
  
(unaudited)
  
(unaudited)
      
Revenues
 
$
18,222
  
$
27,073
  
$
75,384
  
$
58,982
  
Cost of goods sold
   
9,983
   
14,421
   
42,745
   
31,930
 
Restructuring provision for excess and obsolete inventory
    
-
    
-
    
1,502
   
2,143
 
Gross profit
   
8,239
   
12,652
   
31,137
   
24,909
 
Operating expenses:
                          
Selling costs
   
4,589
   
3,958
   
18,008
   
9,789
 
Restructuring charges
    
-
    
-
    
116
   
944
 
Restructuring charge for impairment of intangible assets
    
-
    
-
    
8,874
   
4,664
 
Impairment of service reporting unit goodwill
    
-
    
200
   
-
    
200
 
General and administrative
   
2,681
   
4,275
   
13,493
   
12,902
 
Research and development
   
3,049
   
3,562
   
14,520
   
8,000
 
Total operating expenses
   
10,319
   
11,995
   
55,011
   
36,499
 
Operating income (loss)
   
(2,080
)
  
657
   
(23,874
)
  
(11,590
)
Other income (expenses):
                          
Interest income
   
65
   
83
   
368
   
695
 
Interest expense
   
(39
)
  
(21
)
  
(190
)
  
(161
)
Other income (expense)
   
49
   
87
   
601
   
(19
)
Total other income (expenses)
   
75
   
149
   
779
   
515
 
Income (loss) before income taxes
   
(2,005
)
  
806
   
(23,095
)
  
(11,075
)
Benefit (provision) for income taxes
   
(26
)
  
5
   
(68
)
  
16
 
Income (loss) before minority interest
    
(2,031
)
  
811
   
(23,163
)
  
(11,059
)
Minority interest in net income of Merry Fields
    
-
   
-
   
   
   
(101
)
Net income (loss)
    
($2,031
)
$
811
    
($23,163
)
  
($11,160
)
                           
Weighted average shares - basic
   
21,548
    
21,414
    
21,523
    
21,801
  
Earnings (loss) per share - basic
    
($0.09
)
$
0.04
    
($1.08
)
  
($0.51
)
                           
Weighted average shares -diluted
    
21,548
    
21,589
    
21,523
    
21,801
  
Earnings (loss) per share - diluted
    
($0.09
)
$
0.04
    
($1.08
)
  
($0.51
)