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Oclaro Inc Reports Operating Results (10-Q)

February 16, 2010 | About:
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10qk

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Oclaro Inc (OCLR) filed Quarterly Report for the period ended 2010-01-02.

Oclaro Inc has a market cap of $368.2 million; its shares were traded at around $1.97 with and P/S ratio of 1.75.

Highlight of Business Operations:

On July 4, 2009, we closed a transaction with Newport, under which we sold Newport the assets and liabilities of the New Focus business of Oclaro Photonics, Inc., which was in our advanced photonics solutions division, and in exchange we received the assets of the high power laser diodes business of Newport, which is now part of our advanced photonics solutions division. We also received $3.0 million in cash proceeds in the transaction, which is expected to fund the substantial portion of related transition and integration costs. For accounting purposes, during the three months ended September 26, 2009, we recorded a $1.4 million gain from the sale of the New Focus business and a $5.3 million gain on bargain purchase

On December 17, 2009, we acquired Xtellus Inc. (Xtellus). Pursuant to the acquisition agreement, Oclaro issued 23.4 million shares of its common stock, a portion of which is being held in escrow for 18 months to support Xtellus indemnification obligations to Oclaro. Under the terms of the acquisition agreement, we also provide for a value protection guarantee whereby stockholders of Xtellus are entitled to receive up to $7.0 million in additional consideration if Oclaros common stock trades below certain levels at the end of calendar 2010 and if revenue from Xtellus products is more than $17.0 million in calendar 2010. For accounting purposes, the total consideration in connection with the acquisition is $32.7 million. In connection with this acquisition we recorded $25.2 million in goodwill. We intend to finalize our purchase accounting with respect to the Xtellus acquisition by the fourth quarter of fiscal 2010. Any adjustments recorded in the third or fourth quarter of fiscal 2010 will be retrospectively presented in the Companys condensed consolidated financial statements as though they had been recorded as of the acquisition date.

Revenues for the three months ended January 2, 2010 increased by $50.2 million, or 116 percent, compared to the three months ended December 27, 2008. The increase was primarily related to the inclusion of revenues in fiscal year 2010 generated through the merger with Avanex on April 27, 2009, all of which are associated with our telecom segment. For the three months ended January 2, 2010, revenues in the telecom and advanced photonics solution segments increased by $44.2 million and $6.0 million, respectively, compared to the three months ended December 27, 2008. Our advanced photonics solutions segment increased primarily as a result of classifying $6.8 million in revenues from our New Focus business within discontinued operations for the three months ended December 27, 2008.

For the three months ended January 2, 2010, Huawei Technologies Co., Ltd. (Huawei) accounted for $13.6 million, or 15 percent, of our revenues. For the three months ended December 27, 2008, Huawei accounted for $7.4 million, or 17 percent, of our revenues, Nortel Networks Corporation (Nortel) accounted for $6.7 million, or 15 percent, of our revenues, and Cisco Systems Inc. (Cisco) accounted for $4.3 million, or 10 percent, of our revenues.

Revenues for the six months ended January 2, 2010 increased by $75.9 million, or 74 percent, compared to the six months ended December 27, 2008. The increase was primarily related to the inclusion of revenues in fiscal year 2010 generated through the merger with Avanex on April 27, 2009, all of which are associated with our telecom segment. For the six months ended January 2, 2010, revenues in the telecom and advanced photonics solution segments increased by $65.6 million and $10.3 million, respectively, compared to the six months ended December 27, 2008. Our advanced photonics solutions segment increased primarily as a result of classifying $13.9 million in revenues from our New Focus business within discontinued operations for the six months ended December 27, 2008.

For the six months ended January 2, 2010, Huawei accounted for $24.7 million, or 14 percent, of our revenues. For the six months ended December 27, 2008, Nortel accounted for $18.8 million, or 18 percent, of our revenues and Huawei accounted for $16.4 million, or 16 percent, of our revenues.

Read the The complete Report

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