DragonWave Reports Third Quarter Fiscal Year 2016 Results
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E-mailOTTAWA, CANADA -- (Marketwired) -- 01/13/16 -- DragonWave Inc. (TSX: DWI)(NASDAQ: DRWI) a leading global supplier of packet microwave radio systems for mobile and access networks, today announced financial results for the third quarter of fiscal year 2016. All figures are in U.S. dollars and were prepared in accordance with U.S. generally accepted accounting principles ("GAAP").
Revenue for the third quarter of fiscal year 2016 was $21.0 million, compared with $26.9 million in the second quarter of fiscal year 2016 and $47.3 million in the third quarter of the fiscal year 2015. Revenue from the Nokia channel represented 40% of revenue in the third quarter of this fiscal year, versus 50% in third quarter of fiscal year 2015.
Gross profit in the third quarter of fiscal year 2016 was 23.5%, compared with 14.8% in the second quarter of fiscal year 2016 and 16.3% in the third quarter of fiscal year 2015.
Operating expenses excluding restructuring charges were reduced from $10.5M in the previous quarter to $8.7M in the third quarter.
Net loss attributable to shareholders in the third quarter of fiscal year 2016 was ($6.2) million or ($0.08) per basic and diluted share, which included restructuring charges of $1.4M. This compares to a net loss attributable to shareholders of ($21.0) million or ($0.28) per basic and diluted share in the second quarter of fiscal year 2016 and ($3.8) million or ($0.05) per basic and diluted share in the third quarter of fiscal year 2015.
"We made important improvements this quarter by increasing our gross margins and reducing operating expenses. We have begun to realign the organization to address customer opportunities on a direct basis in light of the changes in our Nokia channel." said DragonWave President and CEO, Peter Allen.
Cash and cash equivalents totaled $7.8 million at the end of the third quarter of fiscal year 2016, compared to $13.1 million at the end of the second quarter of fiscal year 2016.
Webcast and Conference Call Details:
The DragonWave management team will discuss the results on a webcast and conference call beginning at 8:30 a.m. Eastern Time on January 14, 2016.
The live webcast and presentation slides will be available at the Investor Relations section of the DragonWave website at: http://investor.dragonwaveinc.com/events.cfm
An archive of the webcast will be available at the same link.
Conference call dial-in numbers:
Toll-free North America Dial-in: (877) 312-9202
International Dial-in: (408) 774-4000
About DragonWave
DragonWave® is a leading provider of high-capacity packet microwave solutions that drive next-generation IP networks. DragonWave's carrier-grade point-to-point packet microwave systems transmit broadband voice, video and data, enabling service providers, government agencies, enterprises and other organizations to meet their increasing bandwidth requirements rapidly and affordably. The principal application of DragonWave's products is wireless network backhaul, including a range of products ideally suited to support the emergence of underlying small cell networks. Additional solutions include leased line replacement, last mile fiber extension and enterprise networks. DragonWave's corporate headquarters is located in Ottawa, Ontario, with sales locations in Europe, Asia, the Middle East and North America. For more information, visit http://www.dragonwaveinc.com.
DragonWave®, Horizon® and Avenue® are registered trademarks of DragonWave Inc.
Forward-Looking Statements
Certain statements in this release constitute forward-looking statements or forward-looking information as defined by applicable securities laws. Forward-looking statements include statements as to DragonWave's forward opportunities and the potential benefits of, and demand for, DragonWave's products. These statements are subject to certain assumptions, risks and uncertainties, including our view of the relative position of DragonWave's products compared to competitive offerings in the industry.
Forward-looking statements are provided to help external stakeholders understand DragonWave's expectations as of the date of this release and may not be appropriate for other purposes. Readers are cautioned not to place undue reliance on such statements. DragonWave's actual results, performance, achievements and developments may differ materially from the results, performance, achievements or developments expressed or implied by such statements, as a result of the risks identified above as well as other risks identified in our publicly filed documents. Material risks and uncertainties relating to our business are described under the heading "Risks and Uncertainties" in the MD&A dated January 13, 2016 and in the Company's Annual Information Form and other public documents filed by DragonWave with Canadian and United States securities regulatory authorities, which are available at www.sedar.com and www.sec.gov, respectively. DragonWave assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by law.
CONSOLIDATED BALANCE SHEETS
Expressed in US $000's except share amounts
(Unaudited)
As at As at
November 30, February 28,
2015 2015
------------------------------------------------
Assets
Current Assets
Cash and cash equivalents 7,784 23,692
Trade receivables 27,566 48,626
Inventory 25,403 24,294
Other current assets 3,611 5,834
Deferred tax asset 25 61
------------------------------------------------
64,389 102,507
Long Term Assets
Property and equipment 4,148 4,322
Deferred tax asset - 1,485
Deferred financing cost - 18
Intangible assets 704 794
Goodwill - 11,927
------------------------------------------------
4,852 18,546
Total Assets 69,241 121,053
------------------------------------------------
------------------------------------------------
Liabilities
Current Liabilities
Debt facility 26,652 -
Accounts payable and
accrued liabilities 26,118 40,163
Deferred revenue 2,024 830
Capital lease obligation 211 514
Warrant liability 47 -
------------------------------------------------
55,052 41,507
Long Term Liabilities
Debt facility - 32,400
Other long term
liabilities 888 1,139
Warrant liability 4 1,239
------------------------------------------------
892 34,778
Shareholders' equity
Capital stock 221,126 220,952
Contributed surplus 9,024 8,388
Deficit (209,094) (175,921)
Accumulated other
comprehensive loss (9,618) (9,618)
------------------------------------------------
Total Shareholders' equity 11,438 43,801
Non-controlling interests 1,859 967
------------------------------------------------
Total Equity 13,297 44,768
Total Liabilities and Equity 69,241 121,053
------------------------------------------------
------------------------------------------------
Shares issued & outstanding 75,487,649 75,290,818
CONSOLIDATED STATEMENTS OF OPERATIONS
Expressed in US $000's except share and per share amounts
(Unaudited)
Three months ended Nine months ended
------------------------------------------------
November November November November
30, 30, 30, 30,
2015 2014 2015 2014
------------------------------------------------
REVENUE 20,997 47,320 74,254 114,024
Cost of sales 16,063 39,602 59,786 94,527
------------------------------------------------
Gross profit 4,934 7,718 14,468 19,497
------------------------------------------------
EXPENSES
Research and development 2,873 4,827 10,981 14,386
Selling and marketing 2,418 3,557 8,714 10,230
General and administrative 3,398 3,808 10,487 11,797
------------------------------------------------
8,689 12,192 30,182 36,413
------------------------------------------------
Loss before other items (3,755) (4,474) (15,714) (16,916)
Goodwill impairment - - (11,927) -
Restructuring costs (1,419) - (1,419) -
Amortization of intangible
assets (149) (333) (481) (981)
Accretion expense (36) (69) (168) (109)
Interest expense (499) (301) (1,590) (1,105)
Warrant issuance expenses - - - (221)
Gain on change in estimate - 200 - 301
Gain on sale of fixed
assets - 18 - 18
Fair value adjustment -
warrant liability 293 1,880 1,188 1,028
Foreign exchange (loss)
gain 270 145 (24) 519
------------------------------------------------
Loss before income taxes (5,295) (2,934) (30,135) (17,466)
Income tax expense 459 502 2,146 1,047
------------------------------------------------
Net Loss (5,754) (3,436) (32,281) (18,513)
Net Income Attributable to
Non-Controlling Interest (493) (320) (892) (739)
------------------------------------------------
Net Loss attributable to
shareholders (6,247) (3,756) (33,173) (19,252)
Net loss per share
Basic (0.08) (0.05) (0.44) (0.29)
Diluted (0.08) (0.05) (0.44) (0.29)
Weighted Average Shares
Outstanding
Basic 75,450,850 75,254,452 75,341,034 65,738,695
Diluted 75,450,850 75,254,452 75,341,034 65,738,695
Contacts: Investor Contact: Peter Allen President & CEO DragonWave Inc. [email protected] +1-613-599-9991 ext 2222 Media Contact: Nadine Kittle Marketing Communications DragonWave Inc. [email protected] +1-613-599-9991 ext 2262 Media Contact: Becky Obbema Interprose Public Relations (for DragonWave) [email protected] +1-408-778-2024
Source: DragonWave Inc.
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