OTTAWA, CANADA--(Marketwired - July 9, 2014) - 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 first quarter of fiscal year 2015, ended May 31, 2014. All figures are in U.S. dollars and were prepared in accordance with U.S. generally accepted accounting principles.
Revenue for the first quarter of fiscal year 2015 was $28.8 million, compared with $17.9 million in the fourth quarter of fiscal year 2014 and $24.5 million in the first quarter of the fiscal year 2014. Revenue from the Nokia channel (formerly called Nokia Solutions and Networks) represented 61% of revenue in the first quarter of this fiscal year, versus 68% in the fourth quarter of fiscal year 2014 and 57% in first quarter of fiscal year 2014.
Gross margin for the first quarter of fiscal year 2015 was 20.5%, compared with 14.5% in the fourth quarter of fiscal year 2014 and 11.5% in the first quarter of fiscal year 2014.
Net loss applicable to shareholders in the first quarter of fiscal year 2015 was $6.6 million or ($0.11) per basic and diluted share. This compares to a net loss applicable to shareholders of $11.6 million or ($0.20) per basic and diluted share in the fourth quarter of fiscal year 2014 and a net loss applicable to shareholders of $6.6 million or ($0.17) per basic and diluted share in the first quarter of fiscal year 2014.
"We are pleased that the increased demand that we observed in Q1 2015 is continuing into our second quarter. Momentum is such that we anticipate revenue growth between 25% and 40% relative to Q1," said DragonWave President and CEO Peter Allen.
Cash and cash equivalents totaled $15.6 million at the end of the first quarter of fiscal year 2015, compared to $19.0 million at the end of the fourth quarter of fiscal year 2014.
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 July 10, 2014.
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® and Horizon® are registered trademarks of DragonWave Inc.
Forward-Looking Statements
Certain statements in this release constitute forward-looking statements within the meaning of applicable securities laws. Forward-looking statements include statements as to DragonWave's growth opportunities and the potential benefits of, and demand for, DragonWave's products, as well as our expectations regarding Q2 FY2015 revenues and the funnel for both direct sales and the Nokia channel. 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, the timing of orders and deliveries, revenues and expenses, and constraints in the supply chain. 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. Risk factors that may cause the actual results, performance, achievements or developments of DragonWave to differ materially from the results, performance, achievements or developments expressed or implied by such statements can be found in the public documents filed by DragonWave with U.S. and Canadian securities regulatory authorities. 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.
Forward-looking statements are provided to assist external stakeholders in understanding DragonWave's expectations as of the date of this release and may not be appropriate for other purposes. Material risks and uncertainties relating to our business are described under the heading "Risks and Uncertainties" in the MD&A dated July 9, 2014 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.
| | |
| CONSOLIDATED BALANCE SHEETS | |
| Expressed in US $000's except share amounts | |
| (Unaudited) | |
| | | | | | |
| | As at | | | As at | |
| | May 31, | | | February 28, | |
| | 2014 | | | 2014 | |
| Assets | | | | | |
| Current Assets | | | | | |
| | Cash and cash equivalents | 15,567 | | | 18,992 | |
| | Trade receivables | 21,505 | | | 17,408 | |
| | Inventory | 26,023 | | | 30,416 | |
| | Other current assets | 4,974 | | | 5,909 | |
| | Deferred tax asset | 119 | | | 69 | |
| | 68,188 | | | 72,794 | |
| Long Term Assets | | | | | |
| | Property and equipment | 2,964 | | | 3,168 | |
| | Deferred tax asset | 1,536 | | | 1,536 | |
| | Deferred financing cost | 49 | | | 60 | |
| | Intangible assets | 1,466 | | | 1,635 | |
| | Goodwill | 11,927 | | | 11,927 | |
| | 17,942 | | | 18,326 | |
| Total Assets | 86,130 | | | 91,120 | |
| | | | | | |
| Liabilities | | | | | |
| Current Liabilities | | | | | |
| | Accounts payable and accrued liabilities | 25,954 | | | 29,964 | |
| | Deferred revenue | 889 | | | 984 | |
| | Capital lease obligation | 1,633 | | | 1,795 | |
| | 28,476 | | | 32,743 | |
| Long Term Liabilities | | | | | |
| | Debt facility | 17,500 | | | 15,000 | |
| | Other long term liabilities | 3,549 | | | 574 | |
| | Warrant liability | 1,048 | | | 1,360 | |
| | 22,097 | | | 16,934 | |
| | | | | | |
| Shareholders' equity | | | | | |
| | Capital stock | 198,769 | | | 198,593 | |
| | Contributed surplus | 7,478 | | | 7,118 | |
| | Deficit | (161,056 | ) | | (154,505 | ) |
| | Accumulated other comprehensive loss | (9,682 | ) | | (9,682 | ) |
| Total Shareholders' equity | 35,509 | | | 41,524 | |
| | Non-controlling interests | 48 | | | (81 | ) |
| Total Equity | 35,557 | | | 41,443 | |
| Total Liabilities and Equity | 86,130 | | | 91,120 | |
| | | | | | |
| Shares issued & outstanding | 58,491,243 | | | 58,008,746 | |
| | | | | | |
| | |
| CONSOLIDATED STATEMENT OF OPERATIONS | |
| Expressed in US $000's except share amounts | |
| (Unaudited) | |
| | | | | | |
| | Three months ended | | | Three months ended | |
| | May 31, | | | May 31, | |
| | 2014 | | | 2013 | |
| | | | | | |
| REVENUE | 28,771 | | | 24,532 | |
| | Cost of sales | 22,885 | | | 21,712 | |
| Gross profit | 5,886 | | | 2,820 | |
| | | | | | |
| EXPENSES | | | | | |
| | Research and development | 4,265 | | | 5,302 | |
| | Selling and marketing | 3,365 | | | 3,382 | |
| | General and administrative | 4,426 | | | 4,748 | |
| | 12,056 | | | 13,432 | |
| | | | | | |
| Loss before other items | (6,170 | ) | | (10,612 | ) |
| | | | | | |
| | Amortization of intangible assets | (309 | ) | | (559 | ) |
| | Accretion expense | (40 | ) | | (65 | ) |
| | Interest expense | (425 | ) | | (538 | ) |
| | Gain on change in estimate | 101 | | | - | |
| | Gain on contract amendment | - | | | 5,285 | |
| | Fair value adjustment - warrant liability | 150 | | | - | |
| | Foreign exchange gain (loss) | 121 | | | (98 | ) |
| Loss before income taxes | (6,572 | ) | | (6,587 | ) |
| | | | | | |
| | Income tax expense | 95 | | | 92 | |
| Net Loss | (6,667 | ) | | (6,679 | ) |
| | | | | | |
| | Net Loss Attributable to Non-Controlling Interest | 35 | | | 54 | |
| Net Loss applicable to shareholders | (6,632 | ) | | (6,625 | ) |
| | | | | | |
| Net loss per share | | | | | |
| | Basic and Diluted | (0.11 | ) | | (0.17 | ) |
| | | | | | |
| Weighted Average Shares Outstanding | | | | | |
| | Basic and Diluted | 58,194,153 | | | 38,059,919 | |
| | | | | | |