Occam in the News
Correction:-Occam Networks Concludes Restatement Of FY04-'06 Results; Sees Sequentially Wider Loss, Lower Revenues In Q3
October 23, 2007
(RTTNews) - Correction: Corrects the headline "Occam Networks Reports September Quarter Loss Of $0.05 Per Share" sent on October 16. The detailed version of the article follows.
October 16, Telecom equipment provider Occam Networks, Inc. (OCNW | charts | news | PowerRating) said it concluded its restatement of historical consolidated financial statements for 2004 through 2006, following errors found in revenue recognition practices, pertaining to the timing. The company also filed Annual Report on Form 10-K for the fiscal year ended December 31, 2006 and its Quarterly Reports on Form 10-Q for the quarters ended March 31, 2007 and June 30, 2007, with the Securities and Exchange Commission.
The company stated that about $4.9 million of previously recorded revenue was deferred as of December 31, 2006. As a result, aggregate net losses for fiscal years 2004 through 2006 will increase by about $2.1 million to $23.0 million from $20.9 million. The aggregate of company's previously reported revenue for this period was $125.2 million, and the aggregate restated revenue for this period is about $120.2 million.
Occam also announced its operating results for the first and second quarters of fiscal 2007. Revenues for the first and second quarters were $19.0 million and $19.2 million, respectively. Occam reported net income of $29 thousand in the first quarter of 2007, and experienced a net loss of $1.0 million in the second quarter of 2007.
The company's first and second quarters were adversely affected by $349 thousand and $1.2 million, respectively, associated with incremental professional fees payable in connection with the Audit Committee review. Also, stock-based compensation expense for the first and second quarters of 2007 totaled $713 thousand and $363 thousand, respectively.
Looking ahead, the company said it believes its third-quarter revenues would decline substantially relative to the second quarter and that its net loss would increase substantially relative to the second quarter. The company believes that the softening in its business is attributable partly to delays related to customers' evaluations of strategic investment decisions, in part to a shift in customer base and to delays in financial reporting.
The Company anticipates professional fees associated with the audit committee review to be about $2.6 million for the September quarter, contributing to the increased net loss. Shares of OCNW ended Monday's trading session at $6.00.