-----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, Ci+awY5kKHKiqQs30r+GCDajGyT5E7lWbkBEBnVRTBDOgT+UES6fNDN8fz8NK7wM 65KRxZh6wuX8mow8tvHnSg== 0000950148-99-000452.txt : 19990310 0000950148-99-000452.hdr.sgml : 19990310 ACCESSION NUMBER: 0000950148-99-000452 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990216 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990309 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MRV COMMUNICATIONS INC CENTRAL INDEX KEY: 0000887969 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 061340090 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: SEC FILE NUMBER: 001-11174 FILM NUMBER: 99561065 BUSINESS ADDRESS: STREET 1: 8943 FULLBRIGHT AVE CITY: CHATSWORTH STATE: CA ZIP: 91311 BUSINESS PHONE: 8187679044 MAIL ADDRESS: STREET 1: 8943 FULLBRIGHT AVE CITY: CHATSWORTH STATE: CA ZIP: 91311 8-K/A 1 FORM 8-K/A 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 8-K/A CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): FEBRUARY 16, 1999 MRV COMMUNICATIONS, INC. (NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 06-1340090 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER) 8943 FULLBRIGHT AVE CHATSWORTH, CA 91311 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) ISSUER'S TELEPHONE NUMBER: (818)767-9044 ------------------------------------------------------------------- (FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT) 2 Item 5. Other Events On February 16, 1999, MRV Communications, Inc. (the "Registrant") issued a press release announcing the Registrant's year and fourth quarter results. A copy of the press release with a description of the events reported in this Form 8-K is attached as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference. Item 7. Financial Statements and Exhibits (c) Exhibits 99.1 Press Release dated February 16, 1999. 2 3 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. Date: March 9, 1999 MRV COMMUNICATIONS, INC. BY: /s/ Edmund Glazer ------------------------------------ Edmund Glazer Executive Vice President Finance and Administration and Chief Financial Officer 3 EX-99.1 2 EXHIBIT 99.1 1 EXHIBIT 99.1 FOR IMMEDIATE RELEASE FEBRUARY 16, 1999 MRV REPORTS YEAR AND FOURTH QUARTER RESULTS CHATSWORTH, Calif. MRV Communications, Inc., today reported its year end and fourth quarter results for the period ending December 31, 1998. Net sales for the fourth quarter were a record $74,833,000, compared with $48,400,000 for the same period last year, an increase of 55%. Pro forma loss, which excludes extraordinary and one-time items, was $2,347,000 or $0.09 per diluted share, compared with net income of $7,111,000 or $0.25 per diluted share for the fourth quarter of 1997. Net sales for the year ended December 1998 were $264,075,000, compared with $165,471,000 for 1997, an increase of 60%. Pro forma net income for 1998, which excluded extraordinary and one-time items, was $14,869,000 or $0.53 per diluted share, compared with net income of $22,585,000 or $0.88 per diluted share for 1997. Actual net income for the fourth quarter, including extraordinary and one time items, was $239,000 or $0.01 per diluted share compared to net income of $7,111,000 or $0.25 per diluted share for the fourth quarter of 1997. Actual loss for the year, including the extraordinary and one-time items, was $20,106,000 or $0.76 per diluted share compared to net income of $22,585,000 or $0.88 per diluted share for 1997. Noam Lotan, President and CEO, commented, "While the fourth quarter presented extraordinary challenges it appears that we are emerging from a period of sustained downward pressure on margins. Prices on networking products, while continuing to decline, are finding a more stable environment which could lead to improvements. However, during the next two quarters such improvements are not anticipated to be significant. Essential to improving margins will be the following: o Successful market acceptance of a new suite of networking devices with advanced feature sets and improved cost structures. Principal among these are new desktop and workgroup switching products, the Accelerouter introduced at the ComNet show in January, and the Fiber Driver introduced in the fourth quarter. o Enhancement of our manufacturing capabilities, especially with regard to the optical components business where we have incurred higher than normal production costs in the face of a surprisingly strong ramp up in orders." Lotan continued, "As our optical component business continues to grow, MRV becomes one of the most vertically integrated optical networking companies in the market. Ultimately our success will depend on our ability to transmit, route, and manage light moving through a fiber optic network." 4 2 Although MRV reported its first, second, and third quarter results of 1998 in accordance with established accounting practice and valuations of acquired purchased technology in progress provided by independent valuators, these valuations have been reconsidered in light of very recent Securities and Exchange Commission guidance regarding valuation methodology. Based on this new valuation methodology, the value of the purchased technology in progress related to the Xyplex acquisition was reduced to $20,633,000 and the amount of intangible assets was increased by $9,938,000. This release may contain projections or other forward-looking statements regarding future events or the future financial performance of the Company that involve risks and uncertainties. Readers are cautioned that these statements are only predictions and may differ materially from actual future events or results. Readers are referred to the documents filed by MRV with the SEC, specifically the most recent reports on Form 10-K and 10-Q which will be amended for all 1998 quarters, and which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements, including risks associated with dependence on new product offerings, competition, patents, intellectual property and licensing, future growth, rapid technological and market change, manufacturing and sourcing risks, international operations, volatility of stock price, financial risk management, and potential volatility in operating results, among others. MRV Communications, Inc. is a leading manufacturer and marketer of optical networks systems and components. MRV's products integrate switching, routing, remote access and fiber optic transmission systems. The Company designs, manufactures and sells two groups of products: (i) computer networking products, primarily Ethernet local area network ("LAN") routing switches, wide area network ("WAN") and remote access devices and related equipment and (ii) fiber optic components for the transmission of voice, video and data across enterprise, telecommunications and cable TV networks. The Company's advanced networking solutions greatly enhance the functionality of LANs and WANs by reducing network congestion while allowing end users to preserve their legacy investments in pre-existing networks and providing cost-effective migration paths to next generation technologies such as Gigabit Ethernet, remote access and voice over IP. The Company's fiber optic components incorporate proprietary technology which delivers high performance under demanding environmental conditions. MRV COMMUNICATIONS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands)
- ----------------------------------------------------------------------------------- December 31, December 31, 1998 1997 (Audited) (Audited) - ----------------------------------------------------------------------------------- ASSETS CURRENT ASSETS: Cash & cash equivalents $ 20,692 $ 19,428 Short-term investments 30,493 36,413 Accounts receivable, net of reserves of $8,489 in 1998 and $4,252 in 1997 54,596 47,258 Inventories 47,467 41,689 Deferred income taxes 5,035 2,280 Other current assets 5,508 7,248 - ----------------------------------------------------------------------------------- Total current assets 163,791 154,316 PROPERTY AND EQUIPMENT - At cost, net of depreciation and amortization 19,357 8,183 OTHER ASSETS: Intangibles, including goodwill 26,666 5,077 Investments 100,138 62,382 Deferred income taxes 5,661 6,231 Loan financing costs and other 4,579 47 - ----------------------------------------------------------------------------------- $ 320,192 $ 236,236 - ----------------------------------------------------------------------------------- LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Current maturities of financing lease obligations $ 185 $ 111 Accounts payable 29,757 30,439 Accrued liabilities 13,606 8,429 Accrued restructuring costs 82 -- Deferred revenue 4,398 293 Income taxes payable 445 3,485 - ----------------------------------------------------------------------------------- Total current liabilities 48,473 42,757 LONG-TERM LIABILITIES Convertible debentures 90,000 -- Capital lease obligations, net of current portion 1,400 788 Deferred income taxes 48 -- Other long-term liabilities 2,869 2,065 - ----------------------------------------------------------------------------------- Total long term liabilities 94,317 2,853 MINORITY INTERESTS 2,973 657 STOCKHOLDERS' EQUITY: Preferred stock, $0.01 par value: 1,000 shares authorized no shares outstanding -- -- Common stock, $0.0034 par value: 80,000 shares authorized and 26,639 shares outstanding in 1998 and 26,360 shares outstanding in 1997 88 88 Additional paid-in capital 180,656 175,874 Treasury Stock (133) -- Retained earnings (deficit) (5,471) 14,635 Cumulative translation adjustments (711) (628) - ----------------------------------------------------------------------------------- Total stockholders' equity 174,429 189,969 - ----------------------------------------------------------------------------------- $ 320,192 $ 236,236 - -----------------------------------------------------------------------------------
3 MRV COMMUNICATIONS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data)
Year Ended Three Months Ended - ------------------------------------------------------------------------------------------- --------------------------- December 31, December 31, December 31, December 31, 1998 1997 1998 1997 (Audited) (Audited) (Unaudited) (Unaudited) - ------------------------------------------------------------------------------------------- --------------------------- REVENUES, net $ 264,075 $ 165,471 $ 74,883 $ 48,400 - ------------------------------------------------------------------------------------------- --------------------------- COSTS AND EXPENSES: Cost of goods sold 162,284 94,709 53,186 27,843 Write-down of discontinued products 3,101 -- 3,101 -- Research and development expenses 25,817 13,093 8,480 3,999 Selling, general and administrative expenses 56,753 27,365 16,978 8,620 Purchased technology in progress 20,633 -- -- -- Restructuring costs 15,671 -- (7,523) -- - ------------------------------------------------------------------------------------------- --------------------------- Operating income (loss) (20,184) 30,304 661 7,938 Interest expense related to convertible notes 2,480 843 1,110 416 Other income (expense), net 6,819 2,744 3,537 2,284 Provision for income taxes 5,707 9,474 4,665 2,634 Minority interests 1,345 146 975 61 - ------------------------------------------------------------------------------------------- --------------------------- NET INCOME (LOSS) BEFORE EXTRAORDINARY ITEM (22,897) 22,585 (2,552) 7,111 EXTRAORDINARY ITEM Gain on repurchase of convertible notes, net of tax 2,791 -- 2,791 -- NET INCOME (LOSS) $ (20,106) $ 22,585 $ 239 $ 7,111 - ------------------------------------------------------------------------------------------- --------------------------- NET INCOME (LOSS) PER SHARE - BASIC BEFORE EXTRAORDINARY ITEM $ (0.86) $ 0.95 $ (0.10) $ 0.27 NET INCOME (LOSS) PER SHARE - DILUTED BEFORE EXTRAORDINARY ITEM $ (0.86) $ 0.88 $ (0.08) $ 0.25 NET INCOME (LOSS) PER SHARE - BASIC $ (0.76) $ 0.95 $ 0.01 $ 0.27 NET INCOME (LOSS) PER SHARE - DILUTED $ (0.76) $ 0.88 $ 0.01 $ 0.25 - ------------------------------------------------------------------------------------------- --------------------------- SHARES USED IN PER SHARE CALCULATION - BASIC 26,532 23,670 26,637 26,315 SHARES USED IN PER SHARE CALCULATION - DILUTED 26,532 25,734 30,207 28,432 - ------------------------------------------------------------------------------------------- ---------------------------
4 MRV COMMUNICATIONS, INC. The following represents the historical statements of operations adjusted for purchased technology in progress, restructuring costs, writedown of discontinued products and gain on repurchase of convertible notes. PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (the following pro-forma statements exclude extraordinary and one time items as indicated below)
(In thousands, except per share data) Year Ended Three Months Ended - ----------------------------------------------------------------------------------- ---------------------------- December 31, December 31, December 31, December 31, 1998 1997 1998 1997 (Unaudited) (Unaudited) (Unaudited) (Unaudited) - ----------------------------------------------------------------------------------- ---------------------------- REVENUES, net $264,075 $165,471 $ 74,883 $ 48,400 - ----------------------------------------------------------------------------------- ---------------------------- COSTS AND EXPENSES: Cost of goods sold 162,284 94,709 53,186 27,843 Research and development expenses 25,817 13,093 8,480 3,999 Selling, general and administrative expenses 56,753 27,365 16,978 8,620 - ----------------------------------------------------------------------------------- ---------------------------- Operating income (loss) 19,221 30,304 (3,761) 7,938 Interest expense related to convertible notes 2,480 843 1,110 416 Other income (expense), net 6,819 2,744 3,537 2,284 Provision for income taxes 7,346 9,474 38 2,634 Minority interests 1,345 146 975 61 - ----------------------------------------------------------------------------------- ---------------------------- NET INCOME (LOSS) $ 14,869 $ 22,585 $ (2,347) $ 7,111 - ----------------------------------------------------------------------------------- ---------------------------- NET INCOME (LOSS) PER SHARE - BASIC $ 0.56 $ 0.95 $ (0.09) $ 0.27 NET INCOME (LOSS) PER SHARE - DILUTED $ 0.53 $ 0.88 $ (0.09) $ 0.25 - ----------------------------------------------------------------------------------- ---------------------------- SHARES USED IN PER SHARE CALCULATION - BASIC 26,532 23,670 26,637 26,315 SHARES USED IN PER SHARE CALCULATION - DILUTED 31,294 25,734 26,637 28,432 - ----------------------------------------------------------------------------------- ---------------------------- NOTE: PRO FORMA STATEMENTS ABOVE EXCLUDE THE FOLLOWING Purchased technology in progress 20,633 -- -- -- Restructuring costs 15,671 -- (7,523) -- Writedown of discontinued products 3,101 -- 3,101 -- Gain on repurchase of convertible notes 4,430 -- 4,430 --
Contact: Investor Relations Diana Hayden (818) 886-6782 -----END PRIVACY-ENHANCED MESSAGE-----