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Mitel Reports Second Quarter Fiscal 2013 Financial Results
OTTAWA, Nov. 29, 2012 (GLOBE NEWSWIRE) -- Mitel(R) (Nasdaq:MITL) (TSX:MNW), a leading provider of cloud and premises-based unified communications and collaboration (UCC) solutions, today announced financial results for the second quarter of fiscal 2013 ended October 31, 2012. All financial results are in U.S. dollars.
"In the second quarter we exceeded our guidance across all metrics and achieved record overall gross margin of 56.2%, despite a challenging macroeconomic environment," said Richard McBee, Chief Executive Officer, Mitel. "We saw solid revenue growth of 5% sequentially in our business which was attributable to our disciplined execution across the entire company, continued improvements on our channel-focused sales model and product leadership in virtualization and cloud offerings."
Fiscal Second Quarter 2013 Financial Highlights
- Adjusted EBITDA from continuing operations for the second quarter of fiscal 2013 was $24.1 million or 16.6%, up from $21.4 million or 13.8% from the prior year quarter.
- Non-GAAP net income from continuing operations for the second quarter of fiscal 2013 was $14.2 million, or $0.25 per share, up from $12.6 million, or $0.23 per share, in the same period last year.
- Net loss from continuing operations for the second quarter of fiscal 2013 was $1.6 million, or $0.03 per share, diluted, compared to a net loss from continuing operations of $1.7 million, or $0.03 per share, diluted, in the same period last year.
- Revenue from continuing operations for the second quarter of fiscal 2013 was $145.5 million, compared to $154.6 million for the second quarter of fiscal 2012.
- Gross margins from continuing operations were 56.2%, up from 53.0% in the second quarter of fiscal 2012.
- Cash and cash equivalents as of October 31, 2012 were $87.4 million.
- Operating cash flows for the second quarter of fiscal 2013 were $16.7 million.
- In August 2012, in response to macroeconomic concerns, we implemented a restructuring plan that included the termination of approximately 200 employees as well as the closure of excess facilities. We recorded a charge of $9.3 million in the second quarter of fiscal 2013 relating to these actions.
"We are pleased with our operating results this quarter, which was driven by solid execution of our business model and our ability to expand our gross margins and proactively manage our cost structure despite the challenging macroeconomic environment," said Steve Spooner, Chief Financial Officer, Mitel. "While we continue to remain cautious in our forecast, our results this quarter reinforce our confidence in our business model."
Given that the company has previously announced the proposed sale of DataNet/CommSource, the results of the business unit are presented as discontinued operations, and prior period amounts have been adjusted accordingly.
Please refer to the GAAP to non-GAAP reconciliation tables in this release and a discussion of the use of non-GAAP measures under the heading, "Non-GAAP Financial Measurements" below.
Business Unit Results
- Mitel Communications Solutions revenues for the second quarter of fiscal 2013 were $122.0 million, compared to $129.4 million for the second quarter of fiscal 2012. Operating margin improved by 3% year over year primarily as a result of record gross margin in the business unit.
- Mitel NetSolutions revenues for the second quarter of fiscal 2013 grew 2% to $20.9 million from the same quarter of 2012. Operating margin was consistent with the prior year's quarter.
- More than 100% year-over-year growth in Mitel cloud customer base including service provider customers enabled by Mitel cloud solutions, customers deploying Mitel solutions in private clouds, and end-customers deploying Mitel AnyWare.
- Several enhancements to Mitel's cloud offerings including the Mitel AnyWare Cloud Communications Service with advanced contact center functionality, multi-vendor CRM integration, and cloud-based video telepresence and collaboration.
- Continued strengthening of Mitel strategic channel development including: a new distribution agreement with Tech Data Corporation, one of the world's largest wholesale distributors of technology products, further strengthening Mitel's position in the U.S., and the addition of virtualization specialist Entisys Solutions as a strategic Mitel Channel Partner, expanding the reach of Mitel's UCC solutions to customers in California.
Mitel has set the following financial performance guidance for the third quarter of fiscal year 2013 ending January 31, 2013.
- Revenue from continuing operations is expected to be in the range of $141 to $146 million.
- Gross margin percentage from continuing operations is expected to be in the range of 55.0 to 56.0 percent.
- Non-GAAP operating expenses as a percentage of revenue from continuing operations are expected to be in the range of 43.0 to 44.0 percent.
- Non-GAAP operating expenses means SG&A and R&D expenses excluding estimated amortization of $5.6 million for acquisition-related intangible assets and estimated stock-based compensation expense of $1.1 million.