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TMCNet: Sunrise Telecom Reports Profitable First Quarter 2012

[May 02, 2012]

Sunrise Telecom Reports Profitable First Quarter 2012

SAN JOSE, Calif. --(Business Wire)--

Sunrise Telecom® Incorporated (OTC: SRTI) today posted its unaudited financial results for the quarter ended March 31, 2012.

Sunrise Telecom (News - Alert) reported revenue of $7.1 million for the quarter, compared to $8.1 million for the first quarter of 2011. EBITDA for the quarter was $0.5 million, versus a loss of $0.4 million in the first quarter of 2011. First quarter net profit was $0.1 million, or $0.00 per share, versus a loss of $0.9 million, or $(0.02) per share in the first quarter of 2011.

"Our renewed focus on cable products and our ongoing commitment to delivering best-in-class Ethernet and Transport solutions provided solid momentum in the first quarter of 2012," said Bahaa Moukadam (News - Alert), Sunrise Telecom's chief executive officer. "We are very pleased to see positive traction, especially in North America with new and existing customers."

The company attributed its revenue performance in the first quarter to ongoing demand for its MTT (Modular Test Toolkit) platform and increased traction for the new RxT Smart Productivity Test platform, which was recognized as a Best Practice Award winner by Frost & Sullivan (News - Alert) in late 2011. In addition, the company experienced solid demand for Cable RF spectrum analyzer and DOCSIS 3.0 test & maintenance instruments.

"In this first quarter of 2012, we continued our rapid introduction of new products, introducing packetWORX IPTV, a promising addition to our network analysis and monitoring suite of products, in addition to several new wireless backhaul capabilities for the RxT platform," added Mr. Moukadam. "We continue to enhance our distribution channel worldwide and are busy equipping our channel partners with the winning solutions required to address the network deployment and maintenance issues faced by the industry."

About Sunrise Telecom Incorporated

Sunrise Telecom develops and delivers high-quality communications test and measurement solutions for telecom, cable and wireless networks. The company's robust portfolio of feature-rich, easy-to-use products enables service providers to deliver premium voice, video, data, and next-generation digital multimedia services quickly, reliably, and cost-effectively. Based in San Jose, California, Sunrise Telecom distributes its products through a direct sales force and a global network of sales representatives and distributors.

Sunrise Telecom makes available, on or through its website, its press releases and annual, quarterly and other reports, and any amendments to those reports, as soon as reasonably practicable after electronically filing such reports with the OTC Market. Sunrise Telecom's website may be found at www.sunrisetelecom.com. Sunrise Telecom files with the OTC Market yearly financial statements audited by independent auditor, Armanino McKenna LLP. Its quarterly financial statements filed with the OTC Market are not audited nor reviewed.

Use of Non-GAAP Financial Measures

Sunrise Telecom reports financial information in accordance with generally accepted accounting principles (GAAP). Management utilizes EBITDA as a supplemental performance measure because it believes that EBITDA, while it is a non-GAAP financial measure, is a useful measure of the company's performance because it excludes charges that may obscure the company's operating results. Management uses EBITDA to manage and assess the profitability of the company's business.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933, including, but not limited to, material contained in quotations and statements related to the expected release of new products. These forward-looking statements are subject to many risks and uncertainties that could cause actual results to differ materially from those projected. Specific factors that may cause results to differ include the following: our announced financial results have not yet been reviewed or audited; customer acceptance of Sunrise Telecom's new or enhanced products and modules may be slower than expected; product development or introduction into the marketplace may take longer or be more expensive than we anticipate; product delivery schedules may be delayed for development, manufacturing or other reasons; and end-user demand for telecommunications services may be lower than our customers expect, leading to corresponding cutbacks in their spending on our products. These and other risks and uncertainties are described in more detail in Sunrise Telecom's reports including, but not limited to, its annual report for the year ended December 31, 2011 and its quarterly reports for the periods ended March 31, June 30, and September 30, 2011 filed with the OTC Market. Sunrise Telecom assumes no obligation to update the forward-looking statements included in this press release.




 
SUNRISE TELECOM INCORPORATED
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
 
March 31,
  2012  
Assets
Current assets:
Cash and cash equivalents $ 5,594
Held-to-maturity investments 403
Accounts receivable, net of allowances of $97 and $146, respectively 5,822
Inventories 5,626
Prepaid expenses and other assets   408  
Total current assets 17,853
 
Property and equipment, net 2,872
Assets held and used 6,067
Held-to-maturity investments -
Other assets   625  
Total assets $ 27,417  
 
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 1,063
Other accrued liabilities 3,186
Income taxes payable 88
Deferred revenue   336  
Total current liabilities 4,673
Income taxes payable 1,225
Other non-current liabilities   274  
Total liabilities   6,172  
 
Stockholders' equity:
Preferred stock, $0.001 par value per share; 10,000,000 shares authorized, none issued and outstanding -
Common stock, $0.001 par value per share; 175,000,000 shares authorized; 50,377,770 and 50,377,770 shares issued and 50,377,770 and 50,377,770 shares outstanding as of March 31, 2012 and December 31, 2011, respectively 51
Additional paid-in capital 79,592
Accumulated deficit (58,505 )
Accumulated other comprehensive income (loss)   107  
Total stockholders' equity   21,245  
Total liabilities and stockholders' equity $ 27,417  
 
   
SUNRISE TELECOM INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
 
Three Months Ended
March 31,
  2012     2011  
Net sales $ 7,135 $ 8,063
Cost of sales   3,015     3,595  
Gross profit   4,120     4,468  
 
Operating expenses:
Research and development 1,320 2,413
Selling and marketing 1,941 2,242
General and administrative 896 1,106
Impairment charges - -
Restructuring reversals   -     -  
Total operating expenses   4,157     5,761  
Operating loss (37 ) (1,293 )
Other income, net   195     450  
Loss before income taxes 158 (843 )
Income tax expense (benefit)   72     31  
Net income (loss) $ 86   $ (874 )
 
Net loss per share:
Basic $ 0.00   $ (0.02 )
Diluted $ 0.00   $ (0.02 )
 
Shares used in computing net loss per share
Basic   50,378     51,245  
Diluted   50,378     51,245  


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