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TMCNet:  PMC Reports Fourth Quarter and Full Year 2012 Results

[January 31, 2013]

PMC Reports Fourth Quarter and Full Year 2012 Results

SUNNYVALE, Calif. --(Business Wire)--

PMC® (Nasdaq: PMCS), the semiconductor innovator transforming networks that connect, move and store big data, today reported results for the fourth quarter and full year ended December 29, 2012.

Net revenues in the fourth quarter of 2012 were $129.4 million, a sequential decrease of 2 percent compared to $131.7 million in the third quarter of 2012, and a decrease of 15 percent compared to $152.6 million in the fourth quarter of 2011.

GAAP net income in the fourth quarter of 2012 was $11.1 million, or $0.05 per diluted share, compared to GAAP net loss in the third quarter of 2012 was $274.4 million, or $1.31 per share. Third quarter of 2012 GAAP results included impairment write-downs of goodwill and intangible assets of $276.1 million. Non-GAAP net income in the fourth quarter of 2012 was $25.1 million, or $0.12 per diluted share, up 18 percent sequentially, compared to non-GAAP net income of $21.4 million, or $0.10 per diluted share, in the third quarter of 2012.

"We are pleased to report that our fourth quarter results were at the high end of our outlook, despite continued headwinds in the macro environment," said Greg Lang, PMC President and Chief Executive Officer.

Net income on a non-GAAP basis in the fourth quarter of 2012 excludes the following items: (i) $6.3 million stock-based compensation expense; (ii) $10.8 million amortization of purchased intangible assets; and (iii) $3.1 million of other adjustments including income tax related as described in the accompanying GAAP to non-GAAP reconciliation table.

For the full year ended December 29, 2012, net revenues were $531 million compared to $654.3 million for the year ended December 31, 2011, a decrease of 19 percent year over year. GAAP operating loss for the full year 2012 was $281.7 million compared to GAAP operating income of $52.8 million reported in the year ended December 31, 2011. GAAP operating loss for the full year 2012 included impairment write-downs of goodwill and intangible assets of $276.1 million. Non-GAAP operating income for the full year 2012 was $77.5 million compared to non-GAAP operating income of $142.7 million in the prior year. GAAP net loss for the full year 2012 was $333.1 million, or $1.54 per share, compared to GAAP net income of $84.7 million, or $0.36 per diluted share, for the prior year. Non-GAAP net income in the year ended December 29, 2012 was $81.8 million or $0.38 per diluted share, compared to non-GAAP net income of $142 million or $0.60 per diluted share, in the year ended December 31, 2011.

For a full reconciliation of each non-GAAP item used herein to the most directly comparable GAAP financial measure, please refer to the schedule included with this release. The Company believes the additional non-GAAP measures are useful to investors for the purpose of financial analysis. Management uses the non-GAAP measures internally to evaluate its in-period operating performance before gains, losses and other charges that are considered by management to be outside of the Company's core operating results. In addition, the measures are used to plan for the Company's future periods. However, non-GAAP measures are neither stated in accordance with, nor are they a substitute for, GAAP measures.

FOURTH QUARTER AND FULL YEAR 2012 HIGHLIGHTS

The Company announced the following in the fourth quarter and full year of 2012:

  • Nov 19 - PMC Appoints Steve Geiser Vice President and Chief Financial Officer
  • Sept 18 - PMC Delivers Industry's First Tri-Speed Converged Carrier Ethernet/OTN Framer
  • Sept 5 - Adaptec by PMC Transforms Data Center Storage Architectures with Industry's Highest Port Count, PCIe Gen3 RAID Adapters
  • Jun 25 - PMC Wins Huawei 2011 Technology Quality Award
  • Jun 5 - PMC Introduces Industry's Most Integrated, Lowest Power Radio Transceiver Chipset for Next-Generation Macro Base Stations
  • Jun 5 - PMC Delivers Industry's First End-to-End 12Gb/s Enterprise SAS Solution with SSD Controller
  • May 24 - PMC Showcases the Industry's First End-to-End Symmetric 10G EPON Demonstration at OptiNet China
  • Mar 6 - Adaptec Doubles Server Storage Performance and Bandwidth in CeBIT Demo Featuring PCIe 3.0 on the Intel® Xeon® Processor E5-2600 Product Family and Seagate Pulsar® Solid State Drives
  • Feb 29 - PMC Acquires the Server Storage 12Gb/s Expander Product Line from Maxim

Fourth Quarter and Full Year 2012 Conference Call

Management will review the fourth quarter and full year 2012 results and share its outlook for the first quarter of 2013 during a conference call at 1:30 pm Pacific Time/4:30 pm Eastern Time on January 31, 2013. The conference call webcast will be accessible under the Financial News and Events section at; http://investor.pmcs.com. To listen to the conference call live by telephone, dial 1 (888) 771-4371 (US Toll Free) or 1 (847) 585-4405 (International) with passcode 34052547#, approximately ten minutes before the start time. A telephone playback will be available after the completion of the call and can be accessed at 1 (888) 843-7419 using the access code 34052547#. A replay of the webcast will be available for 10 business days.

Safe Harbor Statement

This release contains forward-looking statements that involve risks and uncertainties. The Company's SEC filings describe the risks associated with the Company's business, including PMC's limited revenue visibility due to variable customer demands, market segment growth or decline, orders with short delivery lead times, customer concentration, changes in inventory, and other items such as foreign exchange rates and volatility in global financial markets.

About PMC

PMC (Nasdaq:PMCS) is the semiconductor innovator transforming networks that connect, move and store big data. Building on a track record of technology leadership, the Company is driving innovation across storage, optical and mobile networks. PMC's highly integrated solutions increase performance and enable next-generation services to accelerate the network transformation. For more information, visit www.pmcs.com. Follow PMC on Twitter, LinkedIn and RSS.

© Copyright PMC-Sierra, Inc. 2013. All rights reserved. PMC and PMC-SIERRA are registered trademarks of PMC-Sierra, Inc. in the United States and other countries, and PMCS is a trademark of PMC-Sierra, Inc. Other product and company names mentioned herein may be trademarks of their respective owners. PMC is the corporate brand of PMC-Sierra.




PMC-Sierra, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except for per share amounts)
(unaudited)
         
Three Months Ended Twelve Months Ended
 
December 29, September 30, December 31, December 29, December 31,
  2012     2012     2011     2012     2011  
 
Net revenues $ 129,418 $ 131,723 $ 152,553 $ 530,997 $ 654,304
Cost of revenues   36,663     38,990     47,166     157,918     211,630  
Gross profit 92,755 92,733 105,387 373,079 442,674
 
Research and development 49,553 55,604 56,517 220,927 227,106
Selling, general and administrative 26,432 27,786 27,045 112,479 118,601
Amortization of purchased intangible assets 10,784 11,624 11,099 45,321 44,182
Impairment of goodwill and purchased intangible assets   -     276,082     -     276,082     -  
Income (loss) from operations 5,986 (278,363 ) 10,726 (281,730 ) 52,785
 
Other income (expense):
Revaluation of liability for contingent consideration - - - - 29,376
Gain on investment securities and other 777 180 286 1,523 845
Amortization of debt issue costs (17 ) (50 ) (50 ) (167 ) (200 )
Foreign exchange gain (loss) 439 (2,454 ) (1,194 ) (1,512 ) 344
Interest expense, net   (47 )   (797 )   (295 )   (1,586 )   (2,267 )
Income (loss) before recovery of (provision for) income taxes 7,138 (281,484 ) 9,473 (283,472 ) 80,883
Recovery of (provision for) income taxes   3,949     7,098     18,892     (49,618 )   3,816  
Net income (loss) $ 11,087   $ (274,386 ) $ 28,365   $ (333,090 ) $ 84,699  
 
Net income (loss) per common share - basic $ 0.05 $ (1.31 ) $ 0.12 $ (1.54 ) $ 0.36
Net income (loss) per common share - diluted $ 0.05 $ (1.31 ) $ 0.12 $ (1.54 ) $ 0.36
 
Shares used in per share calculation - basic 202,400 209,512 231,199 216,593 233,210
Shares used in per share calculation - diluted 202,900 209,512 232,028 216,593 235,184
 

As a supplement to the Company's condensed consolidated financial statements presented in accordance with generally accepted accounting principles ("GAAP"), the Company provides additional non-GAAP measures for cost of revenues, gross profit, gross profit percentage, research and development expense, selling, general and administrative expense, amortization of purchased intangible assets, impairment of goodwill and purchased intangible assets, other income (expense), (provision for) recovery of income taxes, operating expenses, operating income (loss), operating margin percentage, net income (loss), and basic and diluted net income (loss) per share.

A non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. The Company believes that the additional non-GAAP measures are useful to investors for the purpose of financial analysis. Management uses these measures internally to evaluate the Company's in-period operating performance before gains, losses and other charges that are considered by management to be outside of the Company's core operating results. In addition, the measures are used for planning and forecasting of the Company's future periods. However, non-GAAP measures are not in accordance with, nor are they a substitute for, GAAP measures. Other companies may use different non-GAAP measures and presentation of results.

PMC-Sierra, Inc.
Adjustments to GAAP Cost of Revenues, Gross Profit, Gross Profit Percentage, Research and Development Expense,
Selling, General and Administrative Expense, Amortization of Purchased Intangible Assets, Impairment of goodwill and purchased intangible assets,
Other Income (Expense), (Provision for) Recovery of Income Taxes, Operating Expenses, Operating Income (Loss),
Operating Margin Percentage, Net Income (Loss), and Basic and Diluted Net Income (Loss) Per Share
(in thousands, except for per share amounts)
(unaudited)
         
Three Months Ended Twelve Months Ended
December 29, September 30, December 31, December 29, December 31,
 

2012 (1)

 

 

2012 (2)

 

 

2011 (3)

 

 

2012 (4)

 

 

2011 (5)

 

 
GAAP cost of revenues $ 36,663 $ 38,990 $ 47,166 $ 157,918 $ 211,630
Stock-based compensation (218 ) (181 ) (242 ) (875 ) (945 )
Acquisition-related costs - - - (37 ) (9,128 )
Asset impairment 10 (108 ) - (98 ) -
Termination costs   (92 )   -     -     (92 )   -  
Non-GAAP cost of revenues $ 36,363   $ 38,701   $ 46,924   $ 156,816   $ 201,557  
 
GAAP gross profit $ 92,755 $ 92,733 $ 105,387 $ 373,079 $ 442,674
Stock-based compensation 218 181 242 875 945
Acquisition-related costs - - - 37 9,128
Asset impairment (10 ) 108 - 98 -
Termination costs   92     -     -     92     -  
Non-GAAP gross profit $ 93,055   $ 93,022   $ 105,629   $ 374,181   $ 452,747  
 
Non-GAAP gross profit % 72 % 71 % 69 % 70 % 69 %
 
GAAP research and development expense $ 49,553 $ 55,604 $ 56,517 $ 220,927 $ 227,106
Stock-based compensation (2,909 ) (2,933 ) (2,983 ) (11,583 ) (11,648 )
Acquisition-related (costs) recoveries (269 ) (751 ) 175 (2,162 ) (203 )
Termination costs (347 ) (690 ) - (2,748 ) -
Asset impairment   (533 )   (479 )   -     (1,012 )   (3,029 )
Non-GAAP research and development expense $ 45,495   $ 50,751   $ 53,709   $ 203,422   $ 212,226  
 
GAAP selling, general and administrative expense $ 26,432 $ 27,786 $ 27,045 $ 112,479 $ 118,601
Stock-based compensation (3,210 ) (2,974 ) (3,500 ) (13,857 ) (14,462 )
Acquisition-related recoveries (costs) 40 (335 ) (810 ) (1,591 ) (3,545 )
Termination costs (219 ) (717 ) - (1,137 ) -
Asset impairment 39 (312 ) - (273 ) -
Lease exit recoveries (costs)   125     (1,755 )   626     (2,384 )   (2,766 )
Non-GAAP selling, general and administrative expense $ 23,207   $ 21,693   $ 23,361   $ 93,237   $ 97,828  
 
GAAP amortization of purchased intangible assets $ 10,784 $ 11,624 $ 11,099 $ 45,321 $ 44,182
Amortization of purchased intangible assets   (10,784 )   (11,624 )   (11,099 )   (45,321 )   (44,182 )
Non-GAAP amortization of purchased intangible assets $ -   $ -   $ -   $ -   $ -  
 
GAAP impairment of goodwill and purchased intangible assets $ - $ 276,082 $ - $ 276,082 $ -
Impairment of goodwill and purchased intangible assets   -     (276,082 )   -     (276,082 )   -  
Non-GAAP impairment of goodwill and purchased intangible assets $ -   $ -   $ -   $ -   $ -  
 
GAAP other income (expense) $ 1,152 $ (3,121 ) $ (1,253 ) $ (1,742 ) $ 28,098
Revaluation of liability for contingent consideration - - - - (29,376 )
Foreign exchange (gain) loss on foreign tax liabilities (872 ) 2,145 1,430 1,531 (583 )
Accretion of debt discount related to senior convertible notes 389 962 906 3,218 3,518
Accretion of liability for contingent consideration - - - - 1,182
Interest expense related to short-term loan - - - - 258
Recovery of impairment on investment securities and other   -     -     (533 )   -     (533 )
Non-GAAP other income (expense) $ 669   $ (14 ) $ 550   $ 3,007   $ 2,564  
 
GAAP (recovery of) provision for income taxes $ (3,949 ) $ (7,098 ) $ (18,892 ) $ 49,618 $ (3,816 )
Recovery of (provision for) income taxes   3,825     6,305     18,889     (50,915 )   7,092  
Non-GAAP (recovery of) provision for income taxes $ (124 ) $ (793 ) $ (3 ) $ (1,297 ) $ 3,276  
 
 
Three Months Ended Twelve Months Ended
December 29, September 30, December 31, December 29, December 31,
 

2012 (1)

 

 

2012 (2)

 

 

2011 (3)

 

 

2012 (4)

 

 

2011 (5)

 

 
GAAP operating expenses $ 86,769 $ 371,096 $ 94,661 $ 654,809 $ 389,889
Stock-based compensation (6,119 ) (5,907 ) (6,483 ) (25,440 ) (26,110 )
Acquisition-related costs (229 ) (1,086 ) (635 ) (3,753 ) (3,748 )
Termination costs (566 ) (1,407 ) - (3,885 ) -
Asset impairment (494 ) (791 ) - (1,285 ) (3,029 )
Lease exit recoveries (costs) 125 (1,755 ) 626 (2,384 ) (2,766 )
Amortization of purchased intangible assets (10,784 ) (11,624 ) (11,099 ) (45,321 ) (44,182 )
Impairment of goodwill and purchased intangible assets   -     (276,082 )   -     (276,082 )   -  
Non-GAAP operating expenses $ 68,702   $ 72,444   $ 77,070   $ 296,659   $ 310,054  
 
GAAP operating income (loss) $ 5,986 $ (278,363 ) $ 10,726 $ (281,730 ) $ 52,785
Stock-based compensation 6,337 6,088 6,725 26,315 27,055
Acquisition-related costs 229 1,086 635 3,790 12,876
Termination costs 658 1,407 - 3,977 -
Asset impairment 484 899 - 1,383 3,029
Lease exit (recoveries) costs (125 ) 1,755 (626 ) 2,384 2,766
Amortization of purchased intangible assets 10,784 11,624 11,099 45,321 44,182
Impairment of goodwill and purchased intangible assets   -     276,082     -     276,082     -  
Non-GAAP operating income $ 24,353   $ 20,578   $ 28,559   $ 77,522   $ 142,693  
 
Non-GAAP operating margin % 19 % 16 % 19 % 15 % 22 %
 
GAAP net income (loss) $ 11,087 $ (274,386 ) $ 28,365 $ (333,090 ) $ 84,699
Stock-based compensation 6,337 6,088 6,725 26,315 27,055
Acquisition-related costs 229 1,086 635 3,790 12,876
Termination costs 658 1,407 - 3,977 -
Asset impairment 484 899 - 1,383 3,029
Lease exit (recoveries) costs (125 ) 1,755 (626 ) 2,384 2,766
Amortization of purchased intangible assets 10,784 11,624 11,099 45,321 44,182
Impairment of goodwill and purchased intangible assets - 276,082 - 276,082 -
Revaluation of liability for contingent consideration - - - - (29,376 )
Foreign exchange (gain) loss on foreign tax liabilities (872 ) 2,145 1,430 1,531 (583 )
Accretion of debt discount related to senior convertible notes 389 962 906 3,218 3,518
Accretion of liability for contingent consideration - - - - 1,182
Interest expense related to short-term loan - - - - 258
Recovery of impairment on investment securities and other - - (533 ) - (533 )
(Recovery of) provision for income taxes   (3,825 )   (6,305 )   (18,889 )   50,915     (7,092 )
Non-GAAP net income $ 25,146   $ 21,357   $ 29,112   $ 81,826   $ 141,981  
 
Non-GAAP net income per share - basic $ 0.12 $ 0.10 $ 0.13 $ 0.38 $ 0.61
Non-GAAP net income per share - diluted $ 0.12 $ 0.10 $ 0.13 $ 0.38 $ 0.60
 
Shares used to calculate non-GAAP net income per share - basic 202,400 209,512 231,199 216,593 233,210
Shares used to calculate non-GAAP net income per share - diluted 202,900 210,525 232,028 218,046 235,184
 
(1) $6.3 million stock-based compensation expense; $0.2 million acquisition-related costs; $0.7 million termination costs; $0.5 million asset impairment; $0.1 million recovery of lease exit costs; $10.8 million amortization of purchased intangible assets; $0.9 million foreign exchange gain on foreign tax liabilities; $0.4 million non-cash interest expense for the accretion of the debt discount related to the senior convertible notes; and $3.8 million recovery of income taxes which includes $5.1 million income tax recovery related to an intercompany dividend, $1.7 million income tax provision relating to intercompany transactions, $1.3 million income tax provision for adjustments relating to prior periods, $0.6 million recovery of arrears interest relating to unrecognized tax benefits, $0.5 million deferred tax recovery related to non-deductible intangible asset amortization and impairment, $0.4 million income tax recovery relating to foreign exchange translation of a foreign subsidiary, and $0.2 million income tax recovery related to tax deductible items above.

 

(2) $6.1 million stock-based compensation expense; $1.1 million acquisition-related costs; $1.4 million termination costs; $0.9 million asset impairment; $1.8 million lease exit costs; $11.6 million amortization of purchased intangible assets; $276.1 million impairment of goodwill and purchased intangible assets; $2.1 million foreign exchange loss on foreign tax liabilities; $1 million non-cash interest expense for the accretion of the debt discount related to the senior convertible notes; and $6.3 million recovery of income taxes which includes $4.3 million income tax recovery related to an intercompany dividend, $2.8 million income tax recovery for adjustments relating to prior periods, $1.7 million income tax provision relating to intercompany transactions, $1.2 million deferred tax recovery related to non-deductible intangible asset amortization and impairment, $0.8 million arrears interest relating to unrecognized tax benefits, and $0.5 million income tax recovery relating to foreign exchange translation of a foreign subsidiary.
 
(3) $6.7 million stock-based compensation expense; $0.6 million acquisition-related costs; $0.6 million recovery of lease exit costs; $11.1 million amortization of purchased intangible assets; $1.4 million foreign exchange loss on foreign tax liabilities; $0.9 million of non-cash interest expense for the accretion of the debt discount related to the senior convertible notes; $0.5 million recovery of impairment on investment securities and other; and $18.9 million recovery of income taxes which includes $10.2 million income tax recovery for adjustments relating to prior periods, $2.5 million reduction of stock option related loss carry-forwards recognized in equity, $1.8 million recovery of arrears interest relating to unrecognized tax benefits, $1 million income tax recovery related to foreign tax credits, $0.6 million net tax recovery relating to foreign exchange translation of a foreign subsidiary, $0.4 million income tax recovery relating to intercompany transactions, and $2.4 million deferred tax recovery related to non-deductible intangible asset amortization.
 
(4) $26.3 million stock-based compensation expense; $3.8 million acquisition-related costs; $4 million termination costs; $1.4 million asset impairment; $2.4 million lease exit costs; $45.3 million amortization of purchased intangible assets; $276.1 million impairment of goodwill and purchased intangible assets; $1.5 million foreign exchange loss on foreign tax liabilities; $3.2 million non-cash interest expense for the accretion of the debt discount related to the senior convertible notes; and $50.9 million provision for income taxes which includes $47.2 million income tax provision related to an intercompany dividend net of $11.1 million related to the U.S. Federal and State tax credits required to be recognized in advance of their utilization, $6.7 million income tax provision relating to intercompany transactions, $3.4 million arrears interest relating to unrecognized tax benefits, $2.8 million deferred tax recovery related to non-deductible intangible asset amortization and impairment, $2.2 million income tax recovery for adjustments relating to prior periods, $0.9 million net tax recovery relating to foreign exchange translation of a foreign subsidiary, and $0.5 million income tax recovery related to tax deductible items above.
 
(5) $27.1 million stock-based compensation expense; $12.9 million acquisition-related costs; $3 million asset impairment; $2.8 million lease exit costs; $44.2 million amortization of purchased intangible assets; $29.4 million revaluation of liability for contingent consideration; $0.6 million foreign exchange gain on foreign tax liabilities; $3.5 million of non-cash interest expense for the accretion of the debt discount related to the senior convertible notes; $1.2 million accretion of liability for contingent consideration; $0.3 million interest related to short-term loan; $0.5 million recovery of impairment on investment securities and other; and $7.1 million recovery of income taxes which includes $9.9 million income tax recovery for adjustments relating to prior periods, $6.5 million income tax provision relating to inter-company transactions, $1 million income tax recovery related to foreign tax credits, $0.6 million of stock option related loss carry-forwards recognized in equity, $0.5 million net tax recovery related to foreign exchange translation of a foreign subsidiary, $0.2 million recovery of arrears interest relating to unrecognized tax

benefits, $0.2 million income tax recovery related to stock-based compensation, and $2.4 million deferred tax recovery related to non-deductible intangible asset amortization.

 

PMC-Sierra, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
   
December 29, December 31,
  2012     2011  
ASSETS:
Current assets:
Cash and cash equivalents $ 169,970 $ 182,571
Short-term investments 11,431 104,391
Accounts receivable, net 62,143 59,213
Inventories, net 23,548 39,911
Prepaid expenses and other current assets 22,125 23,411
Income tax receivable 5,824 8,027
Deferred tax assets   45,063     30,725  
Total current assets 340,104 448,249
 
Investment securities 91,778 226,619
Investments and other assets 20,133 2,431
Prepaid expenses 10,920 16,901
Property and equipment, net 43,146 25,364
Goodwill 252,419 520,899
Intangible assets, net 128,668 158,482
Deferred tax assets   484     494  
$ 887,652   $ 1,399,439  
 
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
2.25% senior convertible notes due October 15, 2025, net $ - $ 65,122
Accounts payable 27,410 38,340
Accrued liabilities 72,282 66,139
Liability for unrecognized tax benefit 52,948 46,394
Income taxes payable 644 -
Deferred income taxes 2,466 2,450
Deferred income   8,113     16,024  
Total current liabilities 163,863 234,469
 
Long-term obligations 17,233 1,284
Deferred income taxes 43,888 40,663
Liability for unrecognized tax benefit 19,257 17,323
 
PMC special shares convertible into 1,019 (2011 - 1,029)
shares of common stock 1,188 1,228
 
Stockholders' equity:
Common stock and additional paid in capital 1,537,930 1,594,667
Accumulated other comprehensive income (loss) 616 (1,146 )
Accumulated deficit   (896,323 )   (489,049 )
Total stockholders' equity   642,223     1,104,472  
$ 887,652   $ 1,399,439  
 

PMC-Sierra, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
 
Twelve Months Ended
December 29, December 31,
  2012     2011  
Cash flows from operating activities:
Net (loss) income $ (333,090 ) $ 84,699
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization 64,535 72,544
Stock-based compensation 26,315 27,055
Unrealized foreign exchange loss (gain), net 1,747 (43 )
Net amortization of premiums/discounts and accrued interest of investments 5,101 4,520
Asset impairment 1,759 3,589
Accrued interest on short-term loan - 589
Gain on investment securities and other (1,508 ) (671 )
Impairment of goodwill and purchased intangible assets 276,082 -
Revaluation of liability for contingent consideration - (29,376 )
Taxes related to intercompany dividend 60,940 -
 
Changes in operating assets and liabilities:
Accounts receivable (2,929 ) 10,177
Inventories 16,363 2,210
Prepaid expenses and other current assets 2,635 2,824
Accounts payable and accrued liabilities (28,267 ) (9,447 )
Deferred income taxes and income taxes payable (8,768 ) (4,044 )
Accrued restructuring costs - (1,609 )
Deferred income   (7,911 )   (2,202 )
Net cash provided by operating activities   73,004     160,815  
 
Cash flows from investing activities:
Business acquisition (15,900 ) (1,669 )
Purchases of property and equipment (31,229 ) (12,702 )
Purchases of intangible assets (7,438 ) (6,116 )
Redemption of short-term investments 26,473 -
Disposals of investment securities 315,310 159,523
Purchases of investment securities and other investments   (120,917 )   (205,903 )
Net cash provided by (used in) investing activities   166,299     (66,867 )
 
Cash flows from financing activities:
Repurchase of senior convertible notes (68,340 ) -
Repurchases of common stock (199,999 ) (39,999 )
Repayment of short-term loan - (180,991 )
Proceeds from issuance of common stock   16,000     16,764  
Net cash used in financing activities   (252,339 )   (204,226 )
 
Effect of exchange rate changes on cash and cash equivalents 435 (506 )
Net decrease in cash and cash equivalents (12,601 ) (110,784 )
Cash and cash equivalents, beginning of year   182,571     293,355  
Cash and cash equivalents, end of year $ 169,970   $ 182,571  


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SIP trunking is becoming more of a focus for service providers. One key issue many service providers face when deploying SIP trunks is NAT, or Network Address Translation, traversal.

What is SIP Trunking? Edition 1
A vast resource for information about all things SIP - including SIP, security, VoIP, SIP trunking and Unified Communications.

Featured Videos

Broadvox VAR Testimonial VAR 1:
Part 1 of the VAR (Value Added Reseller) Partner Program Testimonials for Broadvox...

E-SBCs AS The Demarcation Point:
Ingate's Steve Johnson talks to Erik Linask about the role session border controller plays as the demarcation point at...

Demystifying DPI
How can deep packet inspection protect your SIP traffic as well as your entire network?

Featured Resources

Partner Program Overview:
Over 4,000 VARs, Master Agents, Solution Providers, and Independent IT Professionals trust Broadvox. We offer customized services and solutions to fit seamlessly into any company's business model. And when you partner with Broadvox, every member of our team stands behind you and your customers 100%...

SIP Trunk UC Summit

What's New

Presenting the New Ingate/Intertex Website:
Internet+ is an extended Internet access allowing high quality SIP (Session Initiation Protocol) based real-time person-to-person communication, everywhere and for any application. It applies to both fixed and mobile networks ...

Featured Blogs

Featured Webinars

Secure SIP Trunking:
What You Need to Know

Successfully Deploying Enterprise SIP Trunking:
Tools and Techniques for Overcoming Common Roadblocks

Featured Podcasts

Getting the Most Out of Your SIP Trunks:
Ingate's Steve Johnson and TMC's Erik Linask discuss how best practices forgetting the most out of SIP Trunking services and common pitfalls to avoid.

Featured Datasheets

Ingate SIParator E-SBCs
Adopting SIP is a simple process with the Ingate SIParator, the secure enterprise session border controller (E-SBC). The SIParator makes secure SIP communications - including VoIP,SIP trunking and more - possible while working seamlessly with your existing network firewall.

Ingate Firewalls
Everyone is talking about enterprise usage of VoIP, instant messaging and other types of realtime communications including presence and conferencing.

SIP Trunk Solutions for Service Providers
The award-winning Ingate Firewall and Ingate SIParator deliver a high quality, reliable SIP trunk connection between the customer's IP-PBX and the service provider network, and solve interoperability issues to simplify deployments and support for remote diagnosis of reported issues.