8-K 1 d13407.htm d13407

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 14, 2003

VERILINK CORPORATION
(Exact name of registrant as specified in charter)

   Delaware 000-28562 94-2857548
(State of incorporation) (Commission File Number) (IRS Employer
    Identification No.)

     127 JETPLEX CIRCLE MADISON, AL 35758-8989
(Address of principal executive offices / Zip Code)

256.327.2001
(Registrant’s telephone number, including area code)

Item 12.   Results of Operations and Financial Condition.

     On October 14, 2003, Verilink Corporation (the “Company”) issued a press release regarding its financial results for the quarter ended October 3, 2003. The Company’s press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated by reference herein.

     The information in this Current Report on Form 8-K and the Exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, regardless of any general incorporation language in such filing.

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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.

 

  VERILINK CORPORATION
(Registrant)
     
Dated: October 14, 2003      By:  
 
    C. W. Smith
Vice President and Chief Financial Officer

 

 

 

 

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EXHIBIT INDEX

Exhibit No.       Description
     
99.1   Press Release, dated October 14, 2003 of Verilink Corporation.

 

 

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     Contact:
Bill Smith
Verilink Corporation
256.327.2204
bsmith@verilink.com

Verilink Reports First Fiscal Quarter Results

MADISON, Ala. October 14, 2003 Verilink Corporation (NasdaqSC: VRLK) today reported its financial results for the first fiscal quarter ended October 3, 2003.

Net sales for the quarter were $9.6 million, up 23% from net sales of $7.8 million in the fourth quarter of fiscal 2003, and up 10% from net sales of $8.7 million in the first quarter of fiscal 2003. The Company reported net income of $1.6 million for the quarter compared to net income of $917,000 in the fourth quarter of fiscal 2003 and $250,000 in the first quarter of fiscal 2003, which included the effect of a change in accounting principle related to goodwill of $1.2 million. Diluted earnings per share were $0.10 for the quarter compared to $0.06 for the fourth quarter of fiscal 2003 and $0.02 in the first quarter of fiscal 2003.

Leigh S. Belden, President and CEO stated, "We are pleased with our financial performance again this quarter, which reflects both an increase in sales from the prior quarter and the first quarter last year, as well as an increase in our cash. This quarter marks the sixth consecutive quarter in which we have achieved net income, excluding the charge for in process R&D related to the NetEngine acquisition in the third quarter of fiscal 2003.

“We completed the acquisition of the Miniplex product line from Terayon announced in July 2003. Additionally, we added VoIP capabilities across the entire NetEngine product line, which are, now, included in each integrated access device that we sell.”

Gross margins improved to 53.4% for the quarter compared to 52.8% in the fourth quarter of fiscal 2003 and 51.8% in the first quarter of fiscal 2003 due to product sales mix and higher sales volume.

Operating expenses for the first quarter were $3.6 million, or 37.8% of sales, compared to $3.3 million, or 42.8% of sales for the fourth quarter of fiscal 2003. Compared to the first quarter of fiscal 2003, operating expenses increased $549,000 due to an increase in research and development expenses.

Verilink Reports First Fiscal Quarter Results
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Cash, cash equivalents and short-term investments increased $951,000 and ended the quarter with a balance of $9.6 million. The Company’s cash flow from operating activities was $1.6 million in the first quarter of fiscal 2004 compared to $1.7 million in the first quarter last year.

A live Webcast of the conference call discussing Verilink’s first quarter results and outlook is scheduled for October 14, 2003 at 4:00 p.m. CDT and is available on the Internet by visiting

http://www.firstcallevents.com/service/ajwz389577582gf12.html

Instructions for listening to this call are contained in the Company’s press release dated October 6, 2003 and may be found on the Company's website. A replay of the conference call will be available through the PR Newswire website and in the “News and Events” section of the Company’s website at http://www.verilink.com.

About Verilink Corporation

Verilink provides customer premises voice and data access solutions to service providers, strategic partners and enterprise customers on a worldwide basis. Verilink is a market leader in voice over packet and TDM solutions including VoIP, VoDSL and VoATM. Data-only offerings include DSU/CSUs, access routers, probes and network monitoring capabilities. The Company's headquarters are located at 127 Jetplex Circle, Madison, AL 35758. Verilink stock trades on the NASDAQ SmallCap Market under the symbol VRLK. To learn more about Verilink, visit the website at http://www.verilink.com.

Note: Statements regarding identified market segments and sales growth opportunities and all other statements in this press release that are not historical facts are forward looking and actual results could differ materially. Among the factors that could cause actual results to differ are the ability to increase sales of acquired product lines, impact of customer concentration and the financial strength of customers, the impact to revenue from future sales opportunities, technological change, and changes in demand for the Company's products. A detailed discussion of other risks and uncertainties that could cause actual results and events to differ materially from such forward-looking statements is included in the Company’s most recent filings with the Securities and Exchange Commission, including its most recent Form 10-K and Form 10-Q. The Company disclaims any duty to update the forward -looking statements contained herein, except as may be required by law.

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Verilink and the Verilink logo are registered trademarks of Verilink Corporation. All other trademarks or registered
trademarks are the property of the respective owners.

Verilink Reports First Fiscal Quarter Results
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VERILINK CORPORATION    
Condensed Consolidated Financial Statements (thousands except per share amounts)
  Three months ended  
 
 
CONSOLIDATED STATEMENTS
   OF OPERATIONS
 October 3,
2003
(unaudited)		   September 27,
2002
(unaudited)		  
Net sales $ 9,595       $ 8,713  
Cost of sales   4,471     4,198  
   Gross profit   5,124     4,515  
Research and development   1,384     848  
Selling, general and administrative   2,246     2,233  
   Operating income   1,494     1,434  
Interest and other income, net   180     102  
Interest expense   (38 )   (53 )
   Income before provision for income taxes   1,636     1,483  
Provision for income taxes   -     -  
   Net income before accounting change   1,636     1,483  
Cumulative effect of change in accounting principle, relating to goodwill   -     (1,233 )
Net income $ 1,636   $ 250  
Basic earnings per share:            
   Net income before accounting change $ 0.11   $ 0.10  
   Less: Cumulative effect of change in accounting principle, relating to            
         goodwill   -     (0.08 )
   Net income $ 0.11   $ 0.02  
Diluted earnings per share:            
   Net income before accounting change $ 0.10   $ 0.10  
   Less: Cumulative effect of change in accounting principle, relating to            
         goodwill   -     (0.08 )
   Net income $ 0.10   $ 0.02  
Shares used to compute net income per share - basic   14,734     14,997  
Shares used to compute net income per share - diluted   15,977     15,199  
             
CONSOLIDATED BALANCE SHEETS October 3,
2003
(unaudited)		   June 27,
2003
Current assets:            
   Cash and cash equivalents $ 9,428   $ 8,503  
   Short-term investments   127     101  
   Accounts receivable, net   4,025     3,621  
   Inventories, net   2,743     2,296  
   Other current assets   531     319  
      Total current assets   16,854     14,840  
Property held for lease, net   6,437     6,462  
Property, plant, and equipm ent, net   1,269     1,350  
Restricted cash   1,000     1,000  
Intangible assets, net   2,778     2,132  
Other assets   497     525  
   Total assets $ 28,835   $ 26,309  
Current liabilities $ 8,984   $ 8,461  
Long-term debt and capital lease obligations   3,565     3,749  
Stockholders' equity   16,286     14,099  
   Total liabilities and stockholders' equity $ 28,835   $ 26,309