Aviat Networks Reports Fiscal-Year First-Quarter Financial Results
Tuesday, November 13, 2018 | Comments

Aviat Networks reported financial results for its fiscal 2019 first quarter ended Sept. 28. The company reported total revenues of $60.5 million for its fiscal 2019 first quarter, compared to $56.2 million in the comparable fiscal 2018 period, an increase of $4.3 million or 7.7 percent.

International revenue increased by $7.6 million or 30 percent, offset by a decline in North American revenue of $3.2 million or 10.4 percent.

GAAP gross margin for the fiscal 2019 first quarter was 29.6 percent, compared with 30.8 percent in the comparable fiscal 2018 period, a decrease of 120 basis points. Product and service margins declined year-over-year because of lower concentration of North America revenue as a percentage of the total mix. The company anticipates significant sequential improvement in gross margin and reaffirms its prior guidance for fiscal 2019.

GAAP total operating expenses, excluding restructuring charges, for the fiscal 2019 first quarter were $18.6 million compared with $18.5 million in the comparable fiscal 2018 period, an increase of 0.7 percent. GAAP operating loss was $1.5 million for the fiscal 2019 first quarter, compared with an operating loss of $1.2 million for the comparable fiscal 2018 period, a year-over-year increase of $300,000.

The company reported GAAP net loss from continuing operations of $800,000. Cash, cash equivalents and restricted cash were $28.4 million as of Sept. 28, compared with $37.4 million as of June 29, a decrease of $9 million. The decrease in cash during the period was attributable to an increase in working capital requirements, stemming from an increasing number of projects, mainly in North America, that require higher working capital and timing related to cash collection with a few large customers in the Middle East and Africa. Aviat expects improvements in these areas in the second quarter of fiscal 2019.

For first half of fiscal 2019, Aviat anticipates revenue to be in the range of $121 million to $125 million. The company anticipates an improvement in its cash position from the 2019 first quarter of $3 million to $5 million.

The company anticipates fiscal 2019 revenue to be in the range of $250 million to $260 million, representing year-over-year growth of between 4 and 7 percent. The modest adjustment to prior guidance takes into account the delay of a major state contract, which the company believes will materialize, just at a later date, as well as more conservative expectations in Africa.

"While our first-quarter results came in below our expectations, our business grew and remained profitable on an adjusted EBITDA basis,” said Michael Pangia, president and CEO of Aviat Networks. “We expect a strong second quarter and remain on track for growth and improved profitability. Our competitive position continues to strengthen globally, and we see new opportunities for growth in all of our key verticals and geographies."

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