New Threads Only:  Add to Google Reader or Homepage
New Threads & Replies:  Add to Google Reader or Homepage
Forums are for serious investors only. GuruFocus Forum Rules.

Forum List » Business News and Headlines
SEC Filings, Earing Reports, Press Releases
New Topic Search
Goto Thread: PreviousNext
Goto: Forum ListMessage ListNew TopicSearchLog In
Finisar Corp. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: December 8, 2011 04:48PM

Finisar Corp. (FNSR) filed Quarterly Report for the period ended 2011-10-30. Finisar Corp. has a market cap of $1.51 billion; its shares were traded at around $16.59 with a P/E ratio of 16.5 and P/S ratio of 1.6.



Highlight of Business Operations:

Gross Profit. Gross profit decreased $12.1 million, or 14.7%, to $70.3 million in the quarter ended October 30, 2011 compared to $82.4 million in the quarter ended October 31, 2010. Gross profit as a percentage of revenues decreased by 5.1%, from 34.2% in the quarter ended October 31, 2010 to 29.1% in the quarter ended October 30, 2011. We recorded charges of $5.7 million for obsolete and excess inventory in the quarter ended October 30, 2011 compared to $2.8 million in the quarter ended October 31, 2010. We sold inventory that was written-off in previous periods resulting in a benefit of $3.0 million in the quarter ended October 30, 2011 and $2.8 million in the quarter ended October 31, 2010. As a result, we recognized a net charge of $2.7 million in the quarter ended October 30, 2011 compared to no net charge in the quarter ended October 31, 2010. Cost of revenues included stock-based compensation charges of $1.6 million in the quarter ended October 30, 2011 and $1.3 million in the quarter ended October 31, 2010. Excluding amortization of acquired developed technology, the net impact of excess and obsolete inventory charges and stock-based compensation charges, gross profit would have been $76.2 million, or 31.5% of revenues, in the quarter ended October 30, 2011 compared to $84.9 million, or 35.2% of revenues, in the quarter ended October 31, 2010. The decrease in gross margin primarily reflects the decline in average selling prices, offset by reduced material costs, as well as under-utilization of certain manufacturing facilities, higher amortization of acquired developed technology, higher net charges for excess and obsolete inventory and consolidation of the financial results of Ignis, which has a lower average gross margin than the overall corporate average.

Gross profit decreased $16.3 million, or 10.6%, to $136.8 million in the six months ended October 30, 2011 compared to $153.0 million in the six months ended October 31, 2010. Gross profit as a percentage of revenues decreased by 5.0%, from 34.1% in the six months ended October 31, 2010 to 29.1% in the six months ended October 30, 2011. We recorded charges of $11.4 million for obsolete and excess inventory in the six months ended October 30, 2011 compared to $6.6 million in the six months ended October 31, 2010. We sold inventory that was written-off in previous periods resulting in a benefit of $7.0 million in the six months ended October 30, 2011 and $6.4 million in the six months ended October 31, 2010. As a result, we recognized a net charge of $4.4 million in the six months ended October 30, 2011 compared to a net charge of $200,000 in the six months ended October 31, 2010. Cost of revenues included stock-based compensation charges of $3.3 million in the six months ended October 30, 2011 and $2.1 million in the six months ended October 31, 2010. Excluding amortization of acquired developed technology, the net impact of excess and obsolete inventory charges and stock-based compensation charges, gross profit would have been $147.7 million, or 31.4% of revenues, in the six months ended October 30, 2011 compared to $157.7 million, or 35.1% of revenues, in the six months ended October 31, 2010. The decrease in gross margin primarily reflects the decline in average selling prices, offset by reduced material costs, as well as under-utilization of certain manufacturing facilities, higher amortization of acquired developed technology, higher net charges for excess and obsolete inventory and consolidation of the financial results of Ignis, which has a lower average gross margin than the overall corporate average.

General and Administrative Expenses. General and administrative expenses increased $5.3 million, or 61.7%, to $13.8 million in the quarter ended October 30, 2011 compared to $8.5 million in the quarter ended October 31, 2010. The increase was primarily due to a non-recurring net gain of $2.4 million related to the settlement of legal proceedings in the prior year quarter and the consolidation of financial results of Ignis for the quarter ended October 30, 2011. Included in general and administrative expenses were stock-based compensation charges of $1.9 million in the quarter ended October 30, 2011 and $1.4 million in the quarter ended October 31, 2010. General and administrative expenses as a percent of revenues increased to 5.7% in the quarter ended October 30, 2011 compared to 3.5% in the quarter ended October 31, 2010.

General and administrative expenses increased $8.1 million, or 41.5%, to $27.7 million in the six months ended October 30, 2011 compared to $19.6 million in the six months ended October 31, 2010. The increase was primarily due to $1.1 million of transaction costs incurred in connection with our acquisition of Ignis, a non-recurring net gain of $2.4 million related to the settlement of legal proceedings in the prior year and the consolidation of the financial results of Ignis. Included in general and administrative expenses were stock-based compensation charges of $3.8 million in the six months ended October 30, 2011 and $2.4 million in the six months ended October 31, 2010. General and administrative expenses as a percent of revenues increased to 5.9% in the six months ended October 30, 2011 compared to 4.4% in the six months ended October 31, 2010.

Net cash provided by operating activities was $26.4 million in the six months ended October 30, 2011, compared to net cash used in operating activities of $31.2 million in the six months ended October 31, 2010. Cash provided by operating activities in the six months ended October 30, 2011 consisted of our net income, as adjusted to exclude depreciation, amortization and other non-cash items totaling $36.0 million, less cash used for working capital requirements primarily related to increases in accounts receivable, inventory and accounts payable. Accounts receivable decreased by $3.2 million primarily due to strong collections near the end of the second quarter. Inventory increased by $16.6 million and accounts payable increased by $6.7 million due to increased purchases to support projected increased levels of sales. Cash used in operating activities in the six months ended October 31, 2010 consisted of our net income, as adjusted to exclude depreciation, amortization and other non-cash items totaling to $29.3 million and cash used for working capital, primarily related to increases in accounts receivable and inventories, offset by an increase in accounts payable. Accounts receivable increased by $45.6 million primarily due to the increase in revenues. Inventory and accounts payable increased by $24.7 million and $9.8 million, respectively, primarily due to increase in purchases to support higher levels of sales.

Read the The complete Report



Stocks Discussed: FNSR,
Rate this post:




Sorry, only registered users may post in this forum.

Please Login if you have an account or Create a Free Account if you don't




Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial