UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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): March 15, 2012
MRV COMMUNICATIONS, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE |
|
001-11174 |
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06-1340090 |
(State or other jurisdiction of |
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(Commission file number) |
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(I.R.S. employer |
incorporation or organization) |
|
|
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identification number) |
20415 Nordhoff Street, Chatsworth, CA 91311
(Address of principal executive offices) (zip code)
Registrants telephone number, including area code: (818) 773-0900
Not Applicable
Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition
On March 15, 2012, MRV Communications, Inc. (the Company) issued a press release announcing its financial results for the quarter and year ended December 31, 2011, the text of which is set forth in Exhibit 99.1 attached hereto. All information in the press release is presented as of December 31, 2011 unless specifically stated otherwise in the press release, and the Company does not assume any obligation to update such information in the future.
The information included in this Item 2.02, as well as in Exhibit 99.1 attached hereto, shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or otherwise subject to the liabilities of that Section, and shall not be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
Exhibit 99.1 |
|
Companys Press Release dated March 15, 2012 |
Exhibit 99.1
MRV ANNOUNCES FOURTH QUARTER AND FULL YEAR 2011 FINANCIAL RESULTS
CHATSWORTH, CA March 15, 2012 MRV Communications, Inc. (OTCQB: MRVC) (MRV or the Company), a leading provider of optical communications network infrastructure equipment and integration and managed services, today announced financial results for the fourth quarter and year ended December 31, 2011.
Commenting on the Companys financial results announced today, Barry Gorsun, MRVs chief executive officer, stated, As the year progressed we experienced continued momentum, enabling us to report 19% sequential revenue growth in the fourth quarter. The strong end to the year resulted in another year of record revenue. While we are pleased with our top-line performance, we continue to implement initiatives designed to improve operating income, in part by removing costs, enhancing productivity and driving sales. We also focused on driving shareholder value in 2011, building off our efforts in 2010. As we enter 2012, we will continue to identify opportunities to enhance shareholder value while supporting our business units.
MRV reported fourth quarter 2011 revenue of $74.1 million, compared with revenue of $62.5 million in the third quarter and $73.6 million in the fourth quarter of 2010. The $11.6 million sequential increase is attributable to a $9.0 million increase in the Companys Network Integration group and, to a lesser degree, a $2.9 million increase at MRVs Network Equipment group, partially offset by an increase in intersegment sales between each of these two business units, which are eliminated in the Companys consolidated reporting. Both reporting segments benefited from a seasonally strong fourth quarter with the largest sequential increases in revenue coming from the French and Italian Network Integration subsidiaries, which had softer third quarters due to weak local telecom markets. The Companys Optical Communications Systems business unit saw a 12% sequential increase.
Gross margin for the fourth quarter of 2011 was 37.9%, down from 40.2% last quarter and 39.2% in the fourth quarter of 2010. The sequential decrease was due primarily to the Companys Italian business unit in the Network Integration group and a decrease in the proportion of revenue contributed by the Network Equipment group which has higher margins.
Operating expenses in the fourth quarter of $33.4 million included a $7.1 million goodwill impairment charge related to MRVs Scandinavian subsidiary. Excluding this charge, operating expenses in the fourth quarter were $26.3 million, or 35% of revenue, compared to $21.6 million, or 35% of revenue, in the third quarter and $25.8 million, or 35% of revenue, in the fourth quarter of the prior year. The $4.7 million sequential increase included several charges that impact comparability to prior periods including $1.4 million in payments to stock option and restricted stock holders to compensate them for the loss in value of their equity grants due to the $75 million special dividend paid in November 2011, $0.5 million in severance to our former CEO, and $0.2 million in a litigation settlement. The remaining increase was due primarily to higher sales and marketing costs due to normal seasonality. Operating loss for the quarter was $5.3 million, compared with operating income of $3.4 million in the fourth quarter of 2010. This was the result of a $7.1 million goodwill impairment charge in one of MRVs business units, and $2.1 million in other charges as described above.
On a full year basis, MRV reported revenues of $266.8 million, a $10.7 million, or 4%, increase compared to $256.0 million for 2010. Both operating segments contributed to a decline in gross margins from 43.2% last year to 40.3% in 2011.
A more detailed discussion of MRVs 2011 fourth quarter and full year financial results, including an analysis by business segment, is included in the Management Discussion and Analysis section of the Companys Form 10-K filed today.
About MRV Communications, Inc.
MRV Communications, Inc. is a leading global provider of carrier Ethernet, WDM optical transport, infrastructure management equipment and solutions, as well as network integration and managed services. MRVs solutions enable the delivery and provisioning of next-generation optical transport and carrier Ethernet services over any fiber infrastructure. MRV provides equipment and services worldwide to telecommunications service providers, enterprises, and governments, enabling network evolution and increasing efficiency, while reducing complexity and costs. Through its subsidiaries, MRV operates R&D centers in North America and Europe, along with support centers and sales offices around the world. For more information about MRV, visit http://www.mrv.com.
Forward Looking Statements
This press release may contain statements regarding future financial and operating results of MRV, managements assessment of business trends, and other statements about managements future expectations, beliefs, goals, plans or prospects and those of the market segments in which MRV is engaged that are based on managements current expectations, estimates, forecasts and projections about MRV and its consolidated businesses and the respective market segments in which MRVs businesses operate, in addition to managements assumptions. Statements in this press release regarding MRVs future financial and operating results, which are not statements of historical facts, constitute forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words such as expects, anticipates, envisions, estimates, targets, intends, plans, believes, seeks, should, could,
forecasts, projects, variations of such words and similar expressions, are intended to identify such forward-looking statements which are not statements of historical facts. These forward-looking statements are not guarantees of future performance nor guarantees that the events anticipated will occur or expected conditions will remain the same or improve. These statements involve certain risks, uncertainties and assumptions, the likelihood of which are difficult to assess and may not occur, including risks that each of its business segments may not make the expected progress in its respective market, or that managements long-term strategy may not achieve the expected results. Therefore, actual outcomes, performance and results may differ from what is expressed or forecast in such forward-looking statements, and such differences may vary materially from current expectations.
For further information regarding risks and uncertainties associated with MRVs businesses, please refer to the Managements Discussion and Analysis of Results of Operations and Financial Condition and Risk Factors sections of MRVs SEC filings, including, but not limited to, its annual report on Form 10-K for the year ended December 31, 2011, copies of which may be obtained by contacting MRVs investor relations department or by visiting MRVs website at http://www.mrv-corporate.com or the SECs EDGAR website at http://www.sec.gov.
All information in this release is as of December 31, 2011 unless otherwise stated. MRV undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in MRVs expectations.
Contacts
Investor Relations:
MRV Communications, Inc.
(818) 886-MRVC (6782)
ir@mrv.com
or
CJP Communications for MRV
Thomas J. Rozycki, Jr.
(212) 279-3115 x208
trozycki@cjpcom.com
Media Relations:
MRV Communications, Inc.
pr@mrv.com
(Financial tables follow)
MRV Communications, Inc.
Statement of Operations
(In thousands, except per share data)
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Three Months Ended |
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Year To Date |
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Dec 31, |
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Dec 31, |
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Dec 31, |
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Dec 31, |
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(Unaudited) |
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Revenue |
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$ |
74,138 |
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$ |
73,522 |
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$ |
266,753 |
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$ |
256,032 |
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Cost of goods sold |
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46,105 |
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44,399 |
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159,161 |
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145,312 |
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Gross profit |
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28,033 |
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29,123 |
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107,592 |
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110,720 |
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Gross margin |
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38 |
% |
40 |
% |
40 |
% |
43 |
% | ||||
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Operating costs and expenses: |
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Product development and engineering |
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6,259 |
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6,018 |
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24,318 |
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21,788 |
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Selling, general and administrative |
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20,002 |
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19,696 |
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72,855 |
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74,592 |
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Impairment of goodwill |
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7,095 |
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7,095 |
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Total operating expenses |
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33,356 |
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25,714 |
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104,268 |
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96,380 |
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Operating income (loss) |
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(5,323 |
) |
3,409 |
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3,324 |
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14,340 |
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Interest Expense |
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(243 |
) |
(276 |
) |
(930 |
) |
(950 |
) | ||||
Other income, net |
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610 |
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(1,240 |
) |
(1,227 |
) |
(2,056 |
) | ||||
Income (loss) from continuing operations before taxes |
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(4,956 |
) |
1,893 |
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1,167 |
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11,334 |
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Provision (benefit) for income taxes |
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1,541 |
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(1,907 |
) |
4,579 |
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2,660 |
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Income (loss) of continuing operations |
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(6,497 |
) |
3,800 |
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(3,412 |
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8,674 |
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Income (loss) from discontinued operations, net |
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35,697 |
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(3,414 |
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42,106 |
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Net income (loss) |
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(6,497 |
) |
39,497 |
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(6,826 |
) |
50,780 |
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Less: |
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Net income (loss) from continuing operations attributable to noncontrolling interests |
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273 |
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2,089 |
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Net income (loss) from discontinued operations attributable to noncontrolling interests |
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Net income (loss) attributable to MRV |
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$ |
(6,497 |
) |
$ |
39,224 |
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$ |
(6,826 |
) |
$ |
48,691 |
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Net income (loss) from continuing operations attributable to MRV |
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$ |
(6,497 |
) |
$ |
3,527 |
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$ |
(3,412 |
) |
$ |
6,585 |
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Net income (loss) from discontinued operations attributable to MRV |
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$ |
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$ |
35,697 |
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$ |
(3,414 |
) |
$ |
42,106 |
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Net income (loss) per share - basic: |
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From continuing operations: |
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$ |
(0.04 |
) |
$ |
0.02 |
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$ |
(0.02 |
) |
$ |
0.04 |
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From discontinued operations: |
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$ |
|
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$ |
0.23 |
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$ |
(0.02 |
) |
$ |
0.27 |
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Net income (loss) per share - basic |
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$ |
(0.04 |
) |
$ |
0.25 |
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$ |
(0.04 |
) |
$ |
0.31 |
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Net income (loss) per share - diluted: |
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From continuing operations: |
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$ |
(0.04 |
) |
$ |
0.02 |
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$ |
(0.02 |
) |
$ |
0.04 |
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From discontinued operations: |
|
$ |
|
|
$ |
0.23 |
|
$ |
(0.02 |
) |
$ |
0.27 |
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Net income (loss) per share - diluted |
|
$ |
(0.04 |
) |
$ |
0.25 |
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$ |
(0.04 |
) |
$ |
0.31 |
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Weighted average number of shares: |
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Basic |
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157,686 |
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157,257 |
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157,561 |
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157,569 |
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Diluted |
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157,686 |
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158,068 |
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157,561 |
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158,423 |
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MRV Communications, Inc.
Balance Sheet
(In thousands)
|
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December 31, |
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December 31, |
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2011 |
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2010 |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
|
$ |
83,716 |
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$ |
141,001 |
|
Short-term marketable securities |
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13,474 |
| ||
Restricted time deposits |
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1,661 |
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1,709 |
| ||
Accounts receivable, net |
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60,964 |
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61,455 |
| ||
Other receivables |
|
11,604 |
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15,294 |
| ||
Inventories |
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32,163 |
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41,072 |
| ||
Deferred income taxes |
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2,062 |
|
2,511 |
| ||
Other current assets |
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6,592 |
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9,838 |
| ||
Current assets from discontinued operations held for sale |
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|
|
2,774 |
| ||
Total current assets |
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198,762 |
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289,128 |
| ||
Property and equipment, net |
|
9,360 |
|
8,461 |
| ||
Goodwill |
|
17,999 |
|
25,229 |
| ||
Deferred income taxes, net of current portion |
|
3,702 |
|
2,125 |
| ||
Intangibles, net |
|
325 |
|
|
| ||
Other assets |
|
541 |
|
571 |
| ||
Noncurrent assets from discontinued operations held for sale |
|
|
|
1,352 |
| ||
Total assets |
|
$ |
230,689 |
|
$ |
326,866 |
|
|
|
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LIABILITIES AND STOCKHOLDERS EQUITY |
|
|
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Current liabilities: |
|
|
|
|
| ||
Short-term debt |
|
$ |
8,987 |
|
$ |
18,036 |
|
Deferred consideration payable |
|
4,615 |
|
4,615 |
| ||
Accounts payable |
|
32,064 |
|
32,279 |
| ||
Accrued liabilities |
|
22,726 |
|
23,714 |
| ||
Deferred revenue |
|
10,985 |
|
14,186 |
| ||
Other current liabilities |
|
2,422 |
|
2,166 |
| ||
Current liabilities from discontinued operations held for sale |
|
|
|
1,376 |
| ||
Total current liabilities |
|
81,799 |
|
96,372 |
| ||
Other long-term liabilities |
|
6,676 |
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8,931 |
| ||
Long-term liabilities from discontinued operations held for sale |
|
|
|
462 |
| ||
Commitments and contingencies |
|
|
|
|
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Total MRV stockholders equity |
|
142,214 |
|
221,101 |
| ||
Non-controlling interests |
|
|
|
|
| ||
Total Equity |
|
142,214 |
|
221,101 |
| ||
Total liabilities and stockholders equity |
|
$ |
230,689 |
|
$ |
326,866 |
|