Crawley, UK -- (MARKET WIRE) -- March 1, 2007 --
SPIRENT COMMUNICATIONS PLC
PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2006
London, UK - 1 March 2007 - Spirent Communications plc ("Spirent" or "the
Group")
(LSE: SPT; NYSE: SPM), a leading communications technology company, today
announces its preliminary results for its financial year ended 31 December 2006.
Highlights
- Much improved performance for the second half year.
- Markets were highly competitive partly as a result of consolidation
amongst our largest customers.
- Restructuring actions taken during the year with total annualised cost
savings of £16 million at a total cost of £9.1 million.
- 24 per cent of orders for Communications group in the final quarter of
2006 came from new product platforms.
Performance Analysis
- Overall performance reflects continued product transition:
- Spirent TestCenter(TM) sales grew to £20 million (2005: £4 million).
- Existing older platforms, SmartBits and AX, orders declined by £27
million, 15 per cent of total Performance Analysis activity, to £48
million (2005: £75 million).
- All other Broadband products and services grew.
- Wireless continued to make good overall progress.
Service Assurance
- Signed our first major contract with TELUS, a leading provider of data,
IP and wireless solutions in Canada, to provide triple play service
assurance solutions.
Financial
- Four acquisitions made for a total initial consideration of £39.7
million.
- Goodwill impairment of £46.8 million in relation to Service Assurance
and SwissQual.
- Net funds at the year end of £106.1 million with £41.9 million returned
to shareholders to date at an average price of 46.1 pence per share.
Board and management
- New leadership at both Board level and in key operational positions:
in-depth business review underway.
Anders Gustafsson, Chief Executive, commented:
"In 2006 Spirent delivered a much improved second half performance benefiting
from growth in new product revenues and the restructuring actions undertaken.
"With new Board leadership and having made key operational appointments we are
now undertaking an in-depth business review, the outcome of which will be
reported before the AGM in May.
"Our performance in 2007 is expected to benefit from the investment in new and
upgraded products and the acquisitions made last year and further progress
beyond that will depend on the outcome of the business review. We are confident
that our new products, led by Spirent TestCenter, will grow revenue and continue
to gain market share although this will be offset by the decreasing revenue from
our older products. With market conditions continuing to be similar to last
year, we consequently expect only a modest growth in Performance Analysis
revenues. In addition, should sterling continue its recent strength relative to
the US dollar, our performance for 2007, particularly in Systems, will be held
back."
Results
The adjusted profit and earnings per share measures have been restated to
include share-based payment of £5.2 million (2005: £5.1 million) and intangible
amortisation of £1.6 million (2005: nil).
£ million 2006 2005 Change %
------------------------- -------------------- ----------
Reported
Continuing operations
Revenue 271.6 259.3 5
Loss before tax (50.1) (41.7)
Basic loss per share (pence) (5.51) (3.97)
Group
Profit/(loss) for the year 108.8 (24.5)
Basic earnings/(loss) per share (pence) 11.75 (2.62)
Adjusted
Continuing operations
Operating profit1 8.3 6.4 30
Profit/(loss) before tax2 14.3 (0.2)
Adjusted earnings/(loss)3 per share (pence) 1.41 (0.22)
------------------------- ---------- ---------- ----------
Notes
1 Before material one-time items and goodwill impairment.
2 Before material one-time items, goodwill impairment, profit on the disposal of
operations and costs associated with the repayment of loan notes.
3 Adjusted earnings/(loss) per share is based on adjusted earnings as set out in
note 6.
- ends -
Enquiries
Anders Gustafsson,
Chief Executive Spirent Communications +44 (0)1293 767676
plc
Eric Hutchinson,
Chief Financial Officer
Reg Hoare/Libby Young Smithfield +44 (0)20 7360 4900
The Company will host a results presentation today at 09.15 for 09.30 UK time. A
simultaneous webcast of the presentation will be available on the Spirent
Communications plc website at www.spirent.com.
Photography is available from UPPA (Universal Pictorial Press & Agency) -
www.uppa.co.uk
or tel: +44(0)20 7421 6000
About Spirent Communications plc
Spirent Communications plc is a leading communications technology company
focused on delivering innovative systems and services to meet the needs of
customers worldwide. We are a global provider of performance analysis and service
assurance solutions that enable the development and deployment of
next-generation networking technologies such as broadband services, Internet
telephony, 3G wireless and web applications and security testing. The Systems
group develops power control systems for specialist electrical vehicles in the
mobility and industrial markets. Further information about Spirent
Communications plc can be found at
www.spirent.com.
Spirent Communications plc Ordinary shares are traded on the London Stock
Exchange (ticker: SPT) and on the New York Stock Exchange (ticker: SPM; CUSIP
number: 84856M209) in the form of American Depositary Shares ("ADS"),
represented by American Depositary Receipts, with one ADS representing four
Ordinary shares.
Spirent and the Spirent logo are trademarks or registered trademarks of Spirent
Communications plc. All other trademarks or registered trademarks mentioned
herein are held by their respective companies. All rights reserved.
This press release may contain forward-looking statements (as that term is
defined in the United States Private Securities Litigation Reform Act of 1995)
based on current expectations or beliefs, as well as assumptions about future
events. You can sometimes, but not always, identify these statements by the use
of a date in the future or such words as "will", "anticipate", "estimate",
"expect", "project", "intend", "plan", "should", "may", "assume" and other
similar words. By their nature, forward-looking statements are inherently
predictive and speculative and involve risk and uncertainty because they relate
to events and depend on circumstances that will occur in the future. You should
not place undue reliance on these forward-looking statements, which are not a
guarantee of future performance and are subject to factors that could cause our
actual results to differ materially from those expressed or implied by these
statements. Such factors include, but are not limited to: the extent to which
customers continue to invest in next-generation technology and deploy advanced
IP-based services; our ability to manage a significant transition in product
revenues to new product solutions incorporating latest technology; the outcome
of the business review; our ability to successfully expand our customer base;
continuing variable market conditions; pace of economic recovery; our ability to
improve efficiency, achieve the benefits of our cost reduction goals and adapt
to economic changes and other changes in demand or market conditions; our
ability to develop and commercialise new products and services, extend our
existing capabilities in IP services and expand our product offering
internationally; our ability to attract and retain qualified personnel; the
effects of competition on our business; fluctuations in exchange rates and heavy
exposure to the US dollar; changes in the business, financial condition or
prospects of one or more of our major customers; risks of doing business
internationally; risks relating to the acquisition or sale of businesses and our
subsequent ability to integrate businesses; our reliance on proprietary
technology; our exposure to liabilities for product defects; our reliance on
third party manufacturers and suppliers; and other risks described from time to
time in Spirent Communications plc's Securities and Exchange Commission periodic
reports and filings. The Company undertakes no obligation to update any
forward-looking statements contained in this press release, whether as a result
of new information, future events or otherwise.
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