07.08.2023 Adtran Holdings, Inc.  US00486H1059

EQS-News: Adtran Holdings, Inc.: ADTRAN Holdings, Inc. reports second quarter 2023 results


 

EQS-News: Adtran Holdings, Inc. / Key word(s): Half Year Results
Adtran Holdings, Inc.: ADTRAN Holdings, Inc. reports second quarter 2023 results

07.08.2023 / 00:50 CET/CEST
The issuer is solely responsible for the content of this announcement.


ADTRAN Holdings, Inc. reports second quarter 2023 results

 

HUNTSVILLE, AL — (August 06, 2023) — ADTRAN Holdings, Inc. (NASDAQ: ADTN and FSE: QH9) (“ADTRAN Holdings” or the “Company”) today announced its financial results for the second quarter of 2023. For the quarter, revenue was $327.4 million, up 90% year-over-year and 1% quarter-over-quarter. Net loss attributable to the Company for the second quarter of 2023 was $33.3 million, down 1,655% year-over-year and up 3% quarter-over-quarter. Consequently, diluted loss per share attributable to the Company for the quarter was $0.43, down by 1,175% year-over-year and up 2% quarter-over-quarter. Non-GAAP net income attributable to the Company was $0.1 million, down 99% year-over-year and up 102% quarter-over-quarter. Consequently, non-GAAP diluted earnings per share attributable to the Company was $0.00, down 99% year-over-year and up 102% quarter-over-quarter. Non-GAAP net loss and non-GAAP diluted loss per share exclude acquisition related expenses, amortization, adjustments (consisting of intangible amortization of backlog, developed technology, customer relationships, and trade names acquired in connection with business combinations and amortization of inventory fair value adjustments), stock-based compensation expense, amortization of pension actuarial losses, deferred compensation adjustments, integration expenses, restructuring expenses, changes in valuation allowance related to our deferred tax assets, and the tax effect of these adjustments to net (loss) income. The reconciliations between the non-GAAP net loss measures presented herein and the respective equivalent GAAP financial measures are set forth in the tables provided below.

 

ADTRAN Holdings Chairman and Chief Executive Officer Tom Stanton stated, "Our Q2 2023 results were in line with our expectations. Although new customer acquisitions remain near an all-time high, we anticipate the second half of 2023 will continue to present challenges due to customers optimizing inventory and the macroeconomic environment. Nevertheless, we continue to believe that we are in the early stage of an unprecedented investment cycle and Adtran Holdings is well positioned to be one of the largest beneficiaries.”

 

The Company also announced that its Board of Directors declared a cash dividend for the second quarter of 2023. The quarterly cash dividend of $0.09 per common share is to be paid to the Company’s stockholders of record as of the close of business on August 21, 2023. The ex-dividend date is August 20, 2023, and the payment date will be September 5, 2023.

 

The Company confirmed that it will hold a conference call to discuss its second quarter results on Tuesday, August 8, 2023, at 9:30 a.m. Central Time, or 4:30 p.m. Central European Summer Time. ADTRAN Holdings will webcast this conference call. To listen, simply visit our Investor Relations site at investors.adtran.com approximately 10 minutes prior to the start of the call, click on the event “ADTRAN Holdings Releases 2nd Quarter 2023 Financial Results and Earnings Call”, and click on the webcast link.

 

An online replay of the Company’s conference call, as well as the transcript of the Company's conference call, will be available on the Investor Relations site approximately 24 hours following the call and will remain available for at least 12 months. For more information, visit investors.adtran.com or email [email protected].

 

Cautionary Note Regarding Forward-Looking Statements

 

Statements contained in this press release which are not historical facts, such as those relating to strategy, outlook and financial guidance, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can also generally be identified by the use of words such as “believe,” “expect,” “intend,” “estimate,” “anticipate,” “will,” “may,” “could” and similar expressions. In addition, ADTRAN Holdings, through its senior management, may from time to time make forward-looking public statements concerning the matters described herein. All such projections and other forward-looking information speak only as of the date hereof, and ADTRAN Holdings undertakes no duty to publicly update or revise such forward-looking information, whether as a result of new information, future events, or otherwise, except to the extent as may be required by law. All such forward-looking statements are necessarily estimates and reflect management’s best judgment based upon current information. Actual events or results may differ materially from those anticipated in these forward-looking statements as a result of a variety of factors. While it is impossible to identify all such factors, factors which could cause actual events or results to differ materially from those estimated by ADTRAN Holdings include, but are not limited to: (i) risks and uncertainties related to manufacturing and supply chain constraints; (ii) risks and uncertainties related to the completed business combination between the Company, ADTRAN, Inc. (“ADTRAN”) and Adtran Networks SE (“Adtran Networks”), formerly ADVA Optical Networks SE, including risks related to the ability to successfully integrate ADTRAN’s and Adtran Networks’ businesses, the disruption of management time from ongoing business operations due to integration efforts following the business combination, and the risk that ADTRAN Holdings may be unable to achieve expected synergies or that it may take longer or be more costly than expected to achieve those synergies; (iii) the risk of fluctuations in revenue, including due to lengthy sales and approval processes required by major and other service providers for new products and changes in customer demand, as well as tighter inventory management of ADTRAN Holdings’ customers; (iv) the risk posed by potential breaches of information systems and cyber-attacks; (v) the risk that ADTRAN Holdings may not be able to effectively compete, including through product improvements and development; (vi) risks related to ongoing patent litigation; and (vii) other risks set forth in ADTRAN Holdings’ public filings made with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2022, as well as its Form 10-Q for the quarter ended March 31, 2023 filed with the SEC.

 

Explanation of Use of Non-GAAP Financial Measures

 

Set forth in the tables below are reconciliations of gross profit, gross margin, operating expenses, operating (loss) income, other income (expense), net (loss) income inclusive of the non-controlling interest, net (loss) income attributable to the Company, net loss attributable to the non-controlling interest, and (loss) earnings per share - basic and diluted, attributable to the Company, in each case as reported based on generally accepted accounting principles in the United States (“GAAP”), to non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income (loss), non-GAAP other (expense) income, non-GAAP net (loss) income inclusive of the non-controlling interest, non-GAAP net income (loss) attributable to the Company, non-GAAP net loss attributable to the non-controlling interest, and non-GAAP earnings (loss) per share - basic and diluted, attributable to the Company, respectively. Such non-GAAP measures exclude acquisition related expenses, amortization and adjustments (consisting of intangible amortization of backlog, developed technology, customer relationships, and trade names acquired in connection with business combinations and amortization of inventory fair value adjustments), stock-based compensation expense, amortization of pension actuarial losses, deferred compensation adjustments, integration expenses, restructuring expenses, asset impairments, changes in valuation allowance related to our deferred tax assets, and the tax effect of these adjustments to net income. These measures are used by management in our ongoing planning and annual budgeting processes. Additionally, we believe the presentation of these non-GAAP measures when combined with the presentation of the most directly comparable GAAP financial measure, is beneficial to the overall understanding of ongoing operating performance of the Company.

 

These non-GAAP financial measures are not prepared in accordance with, or an alternative for, GAAP and therefore should not be considered in isolation or as a substitution for analysis of our results as reported under GAAP. Additionally, our calculation of non-GAAP measures may not be comparable to similar measures calculated by other companies. 

 

About Adtran

 

ADTRAN Holdings, Inc. (NASDAQ: ADTN and FSE: QH9) is the parent company of Adtran, Inc., a leading global provider of open, disaggregated networking and communications solutions that enable voice, data, video and internet communications across any network infrastructure. From the cloud edge to the subscriber edge, Adtran empowers communications service providers around the world to manage and scale services that connect people, places and things. Adtran solutions are used by service providers, private enterprises, government organizations and millions of individual users worldwide. ADTRAN Holdings, Inc. is also the largest shareholder of Adtran Networks SE, formerly ADVA Optical Networking SE. Find more at Adtran, LinkedIn and Twitter.

 

Published by

ADTRAN Holdings, Inc.

www.adtran.com

 

For media

Gareth Spence

+44 1904 699 358

[email protected]

 

For investors

Steven Williams

+49 89 890 665 918

[email protected]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands)

 

  June 30,     December 31,  
  2023     2022  
Assets          
Current Assets          
Cash and cash equivalents $ 124,294     $ 108,644  
Short-term investments   3,089       340  
Accounts receivable, net   239,565       279,435  
Other receivables   32,394       32,831  
Inventory, net   416,802       427,531  
Prepaid expenses and other current assets   33,880       33,577  
Total Current Assets   850,024       882,358  
Property, plant and equipment, net   115,719       110,699  
Deferred tax assets   82,076       67,839  
Goodwill   388,163       381,724  
Intangibles, net   355,084       401,211  
Other non-current assets   60,634       66,998  
Long-term investments   31,238       32,665  
Total Assets $ 1,882,938     $ 1,943,494  
           
Liabilities, Redeemable Non-Controlling Interest and Equity          
Current Liabilities          
Accounts payable $ 171,735     $ 237,699  
Revolving credit agreements outstanding   210,912       95,936  
Notes payable         24,598  
Unearned revenue   48,030       41,193  
Accrued expenses and other liabilities   26,807       35,235  
Accrued wages and benefits   36,843       44,882  
Income tax payable, net   15,314       9,032  
Total Current Liabilities   509,641       488,575  
Deferred tax liabilities   44,614       61,629  
Non-current unearned revenue   24,111       19,239  
Pension liability   10,883       10,624  
Deferred compensation liability   28,522       26,668  
Non-current lease obligations   20,834       22,807  
Other non-current liabilities   16,401       10,339  
Total Liabilities   655,006       639,881  
Redeemable Non-Controlling Interest   445,462        
Equity          
Common stock   787       781  
Additional paid-in capital   766,428       895,834  
Accumulated other comprehensive income   62,208       46,713  
Retained (deficit) earnings   (41,010 )     55,338  
Treasury stock   (5,943 )     (4,125 )
Non-controlling interest         309,072  
Total Equity   782,470       1,303,613  
Total Liabilities, Redeemable Non-Controlling Interest and Equity $ 1,882,938     $ 1,943,494  

 

 

 

 

Condensed Consolidated Statements of (Loss) Income

(Unaudited)

(In thousands, except per share amounts)

 

    Three Months Ended     Six Months Ended    
    June 30,     June 30,    
    2023     2022     2023     2022    
Revenue                          
Network Solutions   $ 283,002     $ 155,992     $ 565,420     $ 294,366    
Services & Support     44,376       16,046       85,870       32,190    
Total Revenue     327,378       172,038       651,290       326,556    
Cost of Revenue                          
Network Solutions     216,960       99,921       436,090       190,575    
Services & Support     17,865       9,611       34,839       19,159    
Total Cost of Revenue     234,825       109,532       470,929       209,734    
Gross Profit     92,553       62,506       180,361       116,822    
Selling, general and administrative expenses     66,583       27,873       133,980       55,766    
Research and development expenses     70,598       26,500       140,741       52,991    
Operating (Loss) Income     (44,628 )     8,133       (94,360 )     8,065    
Interest and dividend income     358       217       662       421    
Interest expense     (4,064 )     (94 )     (7,351 )     (124 )  
Net investment gain (loss)     1,262       (4,646 )     2,514       (8,061 )  
Other income, net     2,494       681       2,191       455    
(Loss) Income Before Income Taxes     (44,578 )     4,291       (96,344 )     756    
Income tax benefit (expense)     8,363       (2,148 )     19,676       260    
Net (Loss) Income   $ (36,215 )   $ 2,143     $ (76,668 )   $ 1,016    
Less: Net Loss attributable to non-controlling interest(1)     (2,881 )           (8,870 )        
Net (Loss) Income attributable to ADTRAN Holdings, Inc.   $ (33,334 )   $ 2,143     $ (67,798 )   $ 1,016    
                           
Weighted average shares outstanding – basic     78,366       49,123       78,364       49,110    
Weighted average shares outstanding – diluted     78,366       49,809       78,364       49,813    
                           
(Loss) earnings per common share attributable to ADTRAN Holdings, Inc. – basic   $ (0.43 )   $ 0.04     $ (0.87 )   $ 0.02    
(Loss) earnings per common share attributable to ADTRAN Holdings, Inc. – diluted   $ (0.43 )   $ 0.04     $ (0.87 )   $ 0.02    

 

(1) For the three and six months ended June 30, 2023, we have recognized $2.9 million and $5.7 million, respectively, representing the recurring cash compensation earned by non-controlling interest shareholders post-DPLTA and an incremental $3.2 million net loss attributable to non-controlling interests pre-DPLTA for the six months ended June 30, 2023.

 

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)

    Six Months Ended  
    June 30,  
    2023     2022  
Cash flows from operating activities:            
Net (loss) income   $ (76,668 )   $ 1,016  
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:            
Depreciation and amortization     67,467       7,235  
Amortization of debt issuance cost     291        
(Gain) loss on investments     (4,530 )     7,882  
Stock-based compensation expense     8,103       3,781  
Deferred income taxes     (31,962 )     (93 )
Other, net     130       27  
Inventory reserves     20,885       (4,296 )
Changes in operating assets and liabilities:            
Accounts receivable, net     40,975       (14,315 )
Other receivables     561       2,606  
Inventory     (6,920 )     (53,982 )
Prepaid expenses, other current assets and other assets     7,105       671  
Accounts payable     (67,923 )     42,968  
Accrued expenses and other liabilities     110       2,179  
Income taxes payable, net     6,216       (1,597 )
Net cash used in by operating activities     (36,160 )     (5,918 )
             
Cash flows from investing activities:            
Purchases of property, plant and equipment     (20,118 )     (3,285 )
Proceeds from sales and maturities of available-for-sale investments     2,074       25,071  
Purchases of available-for-sale investments     (580 )     (17,002 )
Proceeds from beneficial interests in securitized accounts receivable     1,156        
Net cash (used in) provided by investing activities     (17,468 )     4,784  
             
Cash flows from financing activities:            
Tax withholdings related to stock-based compensation settlements     (6,315 )     (333 )
Proceeds from stock option exercises     163       636  
Dividend payments     (14,156 )     (8,877 )
Proceeds from draw on revolving credit agreements     163,729       28,000  
Repayment of revolving credit agreements     (49,155 )     (28,000 )
Non-controlling interest put option buyback     (1,202 )      
Repayment of notes payable     (24,885 )      
Net cash provided by (used in) financing activities     68,179       (8,574 )
             
Net increase (decrease) in cash and cash equivalents     14,551       (9,708 )
Effect of exchange rate changes     1,099       (3,742 )
Cash and cash equivalents, beginning of period     108,644       56,818  
             
Cash and cash equivalents, end of period   $ 124,294     $ 43,368  
             
Supplemental disclosure of cash financing activities:            
Cash paid for interest   $ 4,719     $ 124  
Cash used in operating activities related to operating leases   $ 4,502     $ 915  
Supplemental disclosure of non-cash investing activities:            
Right-of-use assets obtained in exchange for lease obligations   $ 515     $ 552  
Purchases of property, plant and equipment included in accounts payable   $ 2,662     $ 818  
             

 

Supplemental Information

Reconciliation of Gross Profit and Gross Margin to

 Non-GAAP Gross Profit and Non-GAAP Gross Margin

(Unaudited)

(In thousands)

 



  Three Months Ended     Six Months Ended  
  June 30,
2023
    March 31,
2023
    June 30,
2022
    June 30,
2023
    June 30,
2022
 
Total Revenue $ 327,378     $ 323,912     $ 172,038     $ 651,290     $ 326,556  
                             
Cost of Revenue $ 234,825     $ 236,104     $ 109,532     $ 470,929     $ 209,734  
Acquisition-related expenses, amortization and adjustments(1)   (33,439 )     (32,578 )    
Die wichtigsten Finanzdaten auf einen Blick
  2017 2018 2019 2020 2021 2022 2023
Umsatzerlöse1 556,66 462,36 406,45 356,57 440,45 960,49 960,49
EBITDA1,2 44,30 -25,80 -19,81 5,58 1,22 -4,94 -98,13
EBITDA-Marge3 7,96 -5,58 -4,87 1,56 0,28 -0,51
EBIT1,4 31,21 -39,68 -35,68 -7,95 -12,98 -68,21 -200,46
EBIT-Marge5 5,61 -8,58 -8,78 -2,23 -2,95 -7,10 -20,87
Jahresüberschuss1 19,90 -16,98 -47,31 1,94 -7,62 -8,32 -234,95
Netto-Marge6 3,57 -3,67 -11,64 0,54 -1,73 -0,87 -24,46
Cashflow1,7 -35,37 48,44 -2,21 -13,45 2,67 -41,42 -41,31
Ergebnis je Aktie8 0,49 -0,40 -0,99 0,04 -0,16 -0,03 -3,09
Dividende8 0,26 0,31 0,35 0,35 0,35 0,33 0,34
Quelle: boersengefluester.de und Firmenangaben

  Geschäftsbericht 2023 - Kostenfrei herunterladen.  
1 in Mio. Euro; 2 EBITDA = Ergebnis vor Zinsen, Steuern und Abschreibungen; 3 EBITDA in Relation zum Umsatz; 4 EBIT = Ergebnis vor Zinsen und Steuern; 5 EBIT in Relation zum Umsatz; 6 Jahresüberschuss (-fehlbetrag) in Relation zum Umsatz; 7 Cashflow aus der gewöhnlichen Geschäftstätigkeit; 8 in Euro; Quelle: boersengefluester.de

Wirtschaftsprüfer: PricewaterhouseCoopers

INVESTOR-INFORMATIONEN
©boersengefluester.de
Adtran Holdings
WKN Kurs in € Einschätzung Börsenwert in Mio. €
A3C7M6 7,864 623,21
KGV 2025e KGV 10Y-Ø BGFL-Ratio Shiller-KGV
52,43 36,78 1,35 -25,70
KBV KCV KUV EV/EBITDA
1,16 - 0,60 -7,35
Dividende '22 in € Dividende '23 in € Div.-Rendite '23
in %
Hauptversammlung
0,33 0,00 0,00 08.05.2024
Q1-Zahlen Q2-Zahlen Q3-Zahlen Bilanz-PK
09.08.2024 06.11.2024 15.03.2024
Abstand 60Tage-Linie Abstand 200Tage-Linie Performance YtD Performance 52 Wochen
40,83% 51,71% 15,58% 57,53%
    
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Telekomausrüster , A3C7M6 , QH9 , XETR:QH9