Alliance Fiber Optic (NASDAQ:AFOP)
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Alliance Fiber Optic Products, Inc. (Nasdaq CM: AFOP), an innovative
supplier of fiber optic components, subsystems and integrated modules
for the optical network equipment market, today reported its financial
results for the fourth quarter ended December 31, 2007.
Revenues for the fourth quarter of 2007 totaled $9,214,000, which
represents a 19% increase over revenues of $7,746,000 reported in the
fourth quarter of 2006, and are slightly higher than the revenues of
$9,170,000 reported in the previous quarter. The Company recorded net
income for the fourth quarter of 2007 of $1,045,000, or $0.03 per share
based on 41.2 million shares outstanding, significantly improved over
$653,000, or $0.02 per share based on 40.4 million shares outstanding
for the fourth quarter of 2006. This compares to net income for the
third quarter of 2007 of $1,065,000.
Revenues for fiscal year 2007 totaled $33,786,000, which represents a
26% increase over revenues of $26,792,000 reported in the previous year.
The Company recorded a net profit for fiscal year 2007 of $3,363,000 or
$0.08 per share based on 40.9 million shares outstanding. This
represents a 412% improvement compared with a net profit of $657,000 for
the previous year. On an annual operating profit basis, the Company
improved significantly from a loss of $1,000,000 in fiscal year 2006 to
a profit of $1,605,000 in fiscal year 2007.
Included in expenses for the quarter ended December 31, 2007 was $80,000
of stock-based compensation charges under SFAS 123(R). Included in
expenses for the quarter ended December 31, 2006 was $106,000 of
stock-based compensation charges under SFAS 123(R).
Included in expenses for the year ended December 31, 2007 was $398,000
of stock-based compensation charges under SFAS 123(R). Included in
expenses for the year ended December 31, 2006 was $298,000 of
stock-based compensation charges under SFAS 123(R).
“The fourth quarter capped a year of
consistent improvement and significant milestones for AFOP,”
commented Peter Chang, President and Chief Executive Officer. “Revenues
grew double digits again in the fourth quarter over the year ago quarter
and resulted in a new record for quarterly and annual sales. This is the
seventeenth consecutive quarter with revenue growth over the year ago
quarter. Operating profits and net profits continued to improve
significantly from the year ago quarter. As a result, we generated both
record operating profits and record net profits in 2007. More
importantly, our balance sheet grew stronger in 2007, with our cash and
cash equivalents and short-term investments at the end of 2007
increasing by $5.3 million to $36.5 million from a year ago.”
“In 2007, we made solid progress with
customers, product technology and in operations. As these factors
continue to improve, we remain encouraged about the opportunities we see
in the year ahead. We expect that revenues for the coming quarter will
grow sequentially and be in the range of $9.2 million to $9.7 million,
and that 2008 will be another record year for AFOP. Additionally, with
continued focus on operational efficiencies, we expect to generate
higher operating profits in 2008 while continuing to invest in growth
opportunities for our business,” concluded Mr.
Chang.
Conference Call
Management will host a conference call at 1:30 p.m. Pacific Time on
January 30, 2008 to discuss AFOP’s fourth
quarter and fiscal year 2007 financial results. To participate in AFOP’s
conference call, please call 877-407-9210 at least ten minutes prior to
the call in order for the operator to connect you. The confirmation
number for the call is 269807. AFOP will also provide a live webcast of
its fourth quarter and fiscal year 2007 conference call at AFOP’s
website www.afop.com. An audio replay
will be available until February 6, 2008. The dial in number for the
replay is 877-660-6853 or 201-612-7415. The replay passcodes (account #
286; conference ID#: 269807) are both required for the replay.
About AFOP
Founded in 1995, Alliance Fiber Optic Products, Inc. designs,
manufactures and markets a broad range of high performance fiber optic
components and integrated modules. AFOP's products are used by leading
and emerging communications equipment manufacturers to deliver optical
networking systems to the long-haul, enterprise, metropolitan and last
mile access segments of the communications network. AFOP offers a broad
product line of passive optical components including interconnect
systems, couplers and splitters, thin film CWDM and DWDM components and
modules, optical attenuators, and micro-optics devices. AFOP is
headquartered in Sunnyvale, California, with manufacturing and product
development capabilities in the United States, Taiwan and China. AFOP's
website is located at http://www.afop.com.
Except for the historical information contained herein, the matters
set forth in this press release, including statements as to our ability
to continue to maintain positive earnings, our ability to increase
profitability in future periods, our ability to increase revenues in
future periods and the extent of any revenue increase, our belief that
business conditions are improving; our beliefs regarding our future
opportunities, our ability to continue to focus on our operating
efficiency or our successes in doing so, our expectation regarding our
ability to generate higher operating profits in 2008, and our ability to
continue to invest in growth opportunities, are forward looking
statements within the meaning of the "safe harbor" provisions of the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements are subject to risks and uncertainties that may cause actual
results to differ materially, including, but not limited to general
economic conditions and trends, the impact of competitive products and
pricing, timely introduction of new technologies, timely design
acceptance by our customers, the acceptance of new products and
technologies by our customers, customer demand for our products, the
timing of customer orders, loss of key customers, ability to ramp new
products into volume production, the costs associated with running our
operations, industry-wide shifts in supply and demand for optical
components and modules, industry overcapacity, failure of cost control
initiatives, financial stability in foreign markets, and other risks
detailed from time to time in our SEC reports, including AFOP's Form
10-Q for the quarter ended September 30, 2007. These
forward-looking statements speak only as of the date hereof. AFOP
disclaims any intention or obligation to update or revise any
forward-looking statements.
ALLIANCE FIBER OPTIC PRODUCTS, INC.
Condensed Consolidated Balance Sheets
(in thousands)
(Unaudited)
Dec. 31,
Dec. 31,
2007
2006
ASSETS
Current assets:
Cash and short-term investments
$
36,480
$
31,178
Accounts receivable, net
5,393
4,009
Inventories
5,003
4,465
Other current assets
481
601
Total current assets
47,357
40,253
Property and equipment, net
4,373
4,264
Other assets
226
176
Total assets
$
51,956
$
44,693
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable
$
4,523
$
2,950
Accrued expenses and other liabilities
3,519
2,909
Total current liabilities
8,042
5,859
Long-term liabilities
1,007
930
Total liabilities
9,049
6,789
Stockholders' equity
42,907
37,904
Total liabilities and stockholders' equity
$
51,956
$
44,693
ALLIANCE FIBER OPTIC PRODUCTS, INC.
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended
Twelve Months Ended
Dec. 31,
Sept. 30,
Dec. 31,
Dec. 31,
Dec. 31,
2007
2007
2006
2007
2006
Revenues
$
9,214
$
9,170
$
7,746
$
33,786
$
26,792
Cost of revenues
6,336
6,291
5,473
23,158
19,380
Gross profit
2,878
2,879
2,273
10,628
7,412
Operating expenses:
Research and development
804
876
798
3,217
3,080
Sales and marketing
590
556
571
2,349
2,255
General and administrative
864
817
805
3,457
3,077
Total operating expenses
2,258
2,249
2,174
9,023
8,412
Income (loss) from operations
620
630
99
1,605
(1,000
)
Interest and other income, net
425
435
554
1,758
1,657
Net income
$
1,045
$
1,065
$
653
$
3,363
$
657
Net income per share
Basic
$
0.03
$
0.03
$
0.02
$
0.08
$
0.02
Diluted
$
0.02
$
0.02
$
0.01
$
0.08
$
0.01
Weighted average shares outstanding
Basic
41,187
40,980
40,400
40,897
40,118
Diluted
45,010
44,929
45,196
44,720
44,914
Included in costs and expenses above:
Stock based compensation charges
Cost of revenue
$
28
$
29
$
44
$
149
$
109
Research and development
13
13
19
63
57
Sales and marketing
9
9
10
42
32
General and administrative
30
40
33
144
100
Total
$
80
$
91
$
106
$
398
$
298