Highlights
-- WiMAX revenues at $16.1 million represent 72% of total revenues and
163% increase year over year
-- WiMAX shipments in the third quarter amounted to $18 million
-- Total revenues decreased by 18% quarter over quarter to $22.5 million,
driven by decline in non-WiMAX business
-- Six WiMAX customers each at more than $1 million in revenues
-- Public equity offering raises $32 million net of fees and expenses
-- Cash at $49 million (includes cash equivalents, short-term
investments, restricted cash)
Airspan Networks Inc. (
Key Figures
In $US thousands except Third Qtr Third Qtr Nine Months Nine Months
for EPS 2007 2006 2007 2006
----------- ----------- ----------- -----------
Total Revenue 22,470 27,303 71,203 96,538
----------- ----------- ----------- -----------
WiMAX Revenue 16,119 6,119 44,946 32,983
----------- ----------- ----------- -----------
Non-WiMAX Revenue 6,351 21,184 26,257 63,555
----------- ----------- ----------- -----------
Gross profit 7,790 7,256 17,892 22,419
----------- ----------- ----------- -----------
Operating Expenses 13,583 16,289 40,952 48,488
----------- ----------- ----------- -----------
Net Loss (5,769) (9,123) (22,573) (25,084)
----------- ----------- ----------- -----------
Deemed dividend
associated with
preferred stock (4,138) (9,179) (4,138) (9,179)
----------- ----------- ----------- -----------
Net loss attributable
to common stockholders (9,907) (18,302) (26,711) (34,263)
----------- ----------- ----------- -----------
Net loss per share $ ( 0.24) $ (0.46) $ (0.65) $ (0.86)
----------- ----------- ----------- -----------
Weighted Average
Common Shares
Outstanding (1) 41,905,579 40,137,526 41,084,881 39,924,492
----------- ----------- ----------- -----------
(1) Excludes shares of common stock issuable on exercise of stock
options and 21,630,856 shares of common stock issuable on conversion of
the Company’s Series B preferred stock.
"We have brought in a well executed quarter as we continue the transition
to being a pure play WiMAX supplier," said Eric Stonestrom, Airspan's
president and chief executive officer. "Our addressable market is
expanding and we continue to win WiMAX business in the face of stiff
competition. We are targeting the WiMAX market with a wide selection of
frequency bands and upgradeable and scalable products to meet our
customers' needs. Airspan's underlying business fundamentals are improving
as we continue to leverage our strong development efforts in WiMAX
technology into increasing our customer base."
Business highlights:
Significant contract awards have been registered during the quarter
including a win for the first WiMAX initiative by Telenor to bring wireless
broadband coverage to Norway. Business also continued to be strong in
Eastern Europe and the Middle East as carriers are seeing a growing market
demand for wireless voice and data services in a range of licensed and
unlicensed frequencies.
Airspan has achieved product development milestones including the latest
release of its MIMO Mobile WiMAX software for its HiperMax base station as
well as the introduction of its next generation personal Mobile WiMAX
client device family called MiMAX™, a USB2.0 based device, operating in
four frequency ranges. The MiMAX™ USB device won the Best of WiMAX
World USA award at the WiMAX World USA Show held in Chicago at the end of
September.
Airspan continued to develop its Mobile WiMAX ecosystem, expanding the
relationship with Starent Networks and continued to support industry
standards by successfully demonstrating interoperability of its HiperMAX
Mobile base stations and its MiMAX™ USB device with products from other
companies at the recent WiMAX Forum Fourth Public WiMAX Plugfest held in
Taiwan.
Financial highlights:
WiMAX revenues grew to $16.1 million, representing 72% of total third
quarter revenues. The 18% drop in total revenues to $22.5 million from
$27.3 million in the same period last year resulted from a decrease in
non-WiMAX business, partially offset by the significant increase in WiMAX
revenues. Gross margin was 35%, a strong improvement over the 27% recorded
in the third quarter 2006, underlining the more favorable product mix of
WiMAX over non-WiMAX revenues. Total operating expenses decreased by 17%
over the same period last year. Third quarter 2006 operating expenses
included a restructuring charge of $1.5 million.
Geographical breakdown of revenue for the quarter was as follows: 36% from
Latin America and the Caribbean; 33% from Europe; 14% from Africa and the
Middle East; 8% from Asia; and 9% from North America.
Cash and cash equivalents amounted to $49.0 million (includes cash
equivalents, short-term investments, restricted cash) at September 30,
2007. During the quarter $28.0 million, net of underwriting fees and
expenses, was raised in a public equity offering. In addition, shortly
after the end of the quarter, the underwriters exercised their over
allotment provision for an additional $4.2 million of net proceeds to the
company. Borrowings under the Silicon Valley Bank Line of Credit were
maintained at $7.5 million.
"We are pleased to report the improved operating metrics as well as the
successful completion of the recent public offering. The additional cash
reserves allow us to move forward on a solid footing and provide increased
confidence to our customers and other business partners. We continue to
closely monitor our cost structure to achieve supply chain and operational
savings while, at the same time, remaining committed to a strong research
and development program for Mobile WiMAX technology and product marketing,"
commented David Brant, Airspan's chief financial officer.
Outlook
"A growing number of industry leaders, both business and regulatory, are
embracing WiMAX as part of their wireless broadband initiative," said Mr.
Stonestrom. "WiMAX continues to be recognized as a robust mobile
technology, evidenced by the recent ITU endorsement of WiMAX as an
international mobile standard. Airspan is steadily growing its footprint
and has a solid order backlog which supports our target of full year WiMAX
revenue of $65 million. In addition, we expect to deliver WiMAX products
for some projects with revenue criteria that will result in a deferral of
revenue until 2008. We also expect that our non-WiMAX business will
generate about $4 million in the fourth quarter, bringing our full year
revenue to approximately $95 million."
Conference Call
The Company has scheduled an investor conference call for 5 p.m. EST today.
The dial-in numbers for the live conference call are as follows: US
toll-free number is (888) 443-9987; the international access dial-in number
is +1 (706) 634-0598. Please reference the Airspan Networks quarterly
conference call, Conference ID 19459371. A replay of the call will be
available approximately two hours following the live session through
December 7, 2007. The U.S. toll-free number for the replay is (800)
642-1687; international dial in number for the replay is +1 (706) 645-9291.
Please use access code 19459371.
Investors may also register for the audio web cast of the conference call
under the 'financial calendar' tab of the Investor Relations section of the
Airspan Web site at http://www.visualwebcaster.com/event.asp?id=43438.
About Airspan Networks Inc.
Airspan Networks provides wireless voice and broadband data systems and
solutions for the fixed and mobile WiMAX and Wi-Fi markets, including Voice
Over IP (VoIP). Its wireless products serve operators around the world in
both licensed and unlicensed frequency bands between 700 MHz and 6 GHz.
Airspan has a strong wireless product roadmap that includes WiMAX Forum
Certified equipment and products meeting 802.11 a/b/g Wi-Fi standards,
Airspan's HiperMAX and MicroMAX base station products support portable and
mobile 802.16e-2005 WiMAX alongside fixed and nomadic 802.16-2004 products.
Airspan products also include "self install" and professionally installed
customer premise equipment. Airspan is on the Board and is a founder member
of the WiMAX Forum and a member of the Wi-Fi Alliance. The Company has
deployments in more than 100 countries with more than 400 operators, 100 of
which use Airspan's WiMAX Forum Certified and non-certified products.
Airspan's wireless systems are based on radio technology that delivers
excellent area coverage, high security and resistance to fading. These
systems can be deployed rapidly and cost effectively, providing an
attractive alternative to traditional wired communications networks.
Airspan also offers radio planning, network installation, integration,
training and support services to facilitate the deployment and operation of
its systems. Airspan is an international telecommunications equipment
provider headquartered in Boca Raton, Florida.
More information on Airspan can be found at http://www.airspan.com.
This press release contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. All statements, other than statements of
historical facts, including statements regarding our strategy, future
operations, financial position, future revenues, projected costs,
prospects, plans and objectives of management, may be deemed to be
forward-looking statements. The words "anticipates," "believes,"
"estimates," "expects," "intends," "may," "plans," "projects," "will,"
"would" and similar expressions or negative variations thereof are intended
to identify forward-looking statements, although not all forward-looking
statements contain these identifying words. We may not actually achieve
the plans, intentions or expectations disclosed in our forward-looking
statements and you should not place undue reliance on our forward-looking
statements. There are a number of important factors that could cause actual
results or events to differ materially from the plans, intentions and
expectations disclosed in the forward-looking statements we make. Investors
and others are therefore cautioned that a variety of factors, including
certain risks, may affect our business and cause actual results to differ
materially from those set forth in the forward-looking statements. The
Company is subject to the risks and uncertainties described in its filings
with the Securities and Exchange Commission, including its Annual Report on
Form 10-K for the year ended December 31, 2006 and in the Company's 2007
Quarterly Reports on Form 10-Q. You should read those factors as being
applicable to all related forward-looking statements wherever they appear
in this press release. We do not assume any obligation to update any
forward-looking statements.
Airspan Networks Inc.
Consolidated Balance Sheets
(in thousands)
December 31, September 30,
2006 2007
------------- -------------
(audited) (unaudited)
ASSETS
Current Assets
Cash and cash equivalents $ 15,890 $ 38,300
Restricted cash 1,111 237
Short-term investments 10,233 10,513
Accounts receivable, less allowance for
doubtful accounts 31,063 26,796
Unbilled accounts receivable 711 274
Inventory 23,624 17,490
Prepaid expenses and other current assets 5,935 5,363
------------- -------------
Total Current Assets 88,567 98,973
Property, plant and equipment, net 5,705 5,483
Goodwill 10,231 10,231
Intangible assets, net 2,806 2,103
Other non-current assets 3,245 3,186
------------- -------------
Total Assets $ 110,554 $ 119,976
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable $ 15,940 $ 15,687
Accrued taxes 687 681
Deferred revenue 6,656 5,113
Customer advances 1,665 1,233
Other accrued expenses 16,197 11,302
Short-term debt - 7,500
------------- -------------
Total Current Liabilities 41,145 41,516
------------- -------------
Non Current Liabilities
Long-term debt 1,707 1,739
Stockholders’ Equity
Common stock 12 17
Note receivable - stockholder (87) (87)
Additional paid in capital 308,768 344,493
Accumulated deficit (240,991) (267,702)
------------- -------------
Total Stockholders’ Equity 67,702 76,721
------------- -------------
------------- -------------
Total Liabilities and
Stockholders' Equity $ 110,554 $ 119,976
------------- -------------
Airspan Networks Inc.
Consolidated Statements of Operations
(in thousands except for share and per share data)
Quarter End Year-to-Date
---------------------- ----------------------
October 1, September October 1, September
2006 30, 2007 2006 30, 2007
---------- ---------- ---------- ----------
(unaudited) (unaudited)
Revenue $ 27,303 $ 22,470 $ 96,538 $ 71,203
Cost of revenue (20,047) (14,680) (74,119) (53,311)
---------- ---------- ---------- ----------
Gross profit 7,256 7,790 22,419 17,892
---------- ---------- ---------- ----------
Operating expenses:
Research and development 6,065 6,186 18,850 17,573
Sales and marketing 4,051 3,521 13,582 10,391
Bad debt provision 297 632 1,548 1,587
General and administrative 4,072 3,010 12,154 11,184
Amortization of intangibles 276 234 826 702
Restructuring 1,528 - 1,528 (485)
---------- ---------- ---------- ----------
Total operating expenses 16,289 13,583 48,488 40,952
---------- ---------- ---------- ----------
Loss from operations (9,033) (5,793) (26,069) (23,060)
Interest expense (78) (175) (162) (246)
Interest and other income 5 223 885 794
---------- ---------- ---------- ----------
Loss before income taxes (9,106) (5,745) (25,346) (22,512)
Income tax (credit)/charge (17) (24) 262 (61)
---------- ---------- ---------- ----------
Net loss before deemed
dividend (9,123) (5,769) (25,084) (22,573)
Deemed dividend associated
with preferred stock (9,179) (4,138) (9,179) (4,138)
---------- ---------- ---------- ----------
Net loss $ (18,302) $ (9,907) $ (34,263) $ (26,711)
========== ========== ========== ==========
Net loss per share - basic
and diluted $ (0.46) $ (0.24) $ (0.86) $ (0.65)
Weighted average shares
Outstanding - basic
And diluted 40,137,526 41,905,579 39,924,492 41,084,881
Contact Information: For Investor Relations and Media Inquiries, contact: David Brant Senior Vice President & Chief Financial Officer Airspan Networks Inc. Tel: +1 561 893-8650 Fax: +1 561 893-8681 Email: