UTStarcom Reports Unaudited Financial Results for First Half of 2020 Nasdaq:UTSI

Written by on October 30, 2020

HANGZHOU, China, Oct. 30, 2020 (GLOBE NEWSWIRE) — UTStarcom (“UT” or the “Firm”) (NASDAQ: UTSI), a world telecommunications infrastructure supplier, at this time reported its unaudited monetary outcomes for the six months ended June 30, 2020.

Enterprise Replace

  • Standing of 5G Transport Community Alternative with a Main Cell Provider in China UTStarcom collaborated with a associate to develop crucial 5G transport community applied sciences to assist the 5G migration in China. The Firm in-house developed product and its community administration and controller has handed the operator’s Benchmark Testing of its Central Procurement Part 1. UTStarcom and our associate have been acknowledged as certified distributors and awarded sure portion of the 5G community mission in two provinces. Nonetheless, as a result of small measurement of enterprise alternative, we determined to not transfer ahead with business deployment.
  • Launch of 5G Transport Community Resolution In September 2020, the Firm launched its state-of-the-art 5G product resolution, SkyFlux Converged Packet Transport platform. It combines Section Routing/MPLS-TP tunneling, TDM-like Ethernet primarily based on FlexE/G.mtn, extremely correct time synchronization and SDN-based community intelligence into an environment friendly future-proof structure of 5G-ready transport community. The brand new platform contains two merchandise, SkyFlux SPN805S & 803S and a community administration and controller “SOO Station R3.2”.
  • Growth of Community Disaggregation Telecom operators are more and more targeted on networking gadget disaggregation. This encompasses the decoupling of {hardware} and software program that allows operator to decide on independently essentially the most appropriate {hardware}, working system and set of options and management interfaces. UTStarcom is leveraging its experience in 5G transport community to develop community disaggregation options, together with White Field Change (WBS) and Community Working System (NOS). The Firm is seeing preliminary curiosity for these options from a handful of operators.
  • Impression of the COVID-19 Virus Companies in most components of the world have been negatively impacted within the first half of 2020 on account of obligatory shutdowns associated to the COVID-19 pandemic. Since then, manufacturing and operations in China have returned to regular. Nonetheless, exterior of China, the COVID-19 state of affairs stays a well being menace with a resurgence of COVID-19 instances in numerous components of the world. Because of this, the influence to the Firm’s future operations continues to be important and extended.
  • India Receivable The Firm continues to gather quantities due from its main buyer in India. The main buyer in India raised INR8,500 Crore (roughly USD1.13 billion) by way of sovereign assured bonds (issued at coupon fee of 6.79 per cent every year for 10 12 months interval) and cleared a portion of its payables to distributors, together with the Firm. For the reason that Firm’s final earnings launch on March 27, 2020, over $16 million has been collected, with $49 million excellent. Nonetheless, because the buyer’s working standing has no important enchancment, in addition to the continuing fee processing was delayed by COVID-19 pandemic in India, the timing of future funds stays unsure.

UTStarcom’s appearing Chief Government Officer Dr. Zhaochen Huang commented, “Our outcomes for the primary half of 2020 have been negatively impacted by the COVID-19 pandemic. Whereas we proceed to navigate this difficult macro atmosphere, we’re targeted on creating new merchandise that capitalize on necessary expertise developments and interesting with community operators to deal with and assist their necessities.”

First Half 2020 Monetary Outcomes

Abstract of 1H 2020 Key Financials

 1H 20201H 2019Y/Y Change
Income$13.7$38.6-64.5%
Gross Revenue$2.6$12.0-78.2%
Working Bills$11.9$14.4-17.1%
Working Loss($9.3)($2.3)-$7.0
Web Revenue/Loss($12.0)$2.1-$14.2
Fundamental EPS($0.34)$0.06-$0.40
Money Stability (together with Restricted Money)$48.6$55.1-11.7%

* Greenback comparisons are used the place proportion comparisons will not be significant.
* All of the numbers in U.S. {Dollars} are in thousands and thousands aside from Earnings Per Share (EPS)

Whole Revenues

Whole revenues for the primary half of 2020 have been $13.7 million, in comparison with $38.6 million within the corresponding interval in 2019.

  • Web tools gross sales for the primary half of 2020 have been $9.Three million, a lower of 67.9% from $29.Zero million within the corresponding interval in 2019. The lower was on account of order cancellations throughout the COVID-19 pandemic coupled with the decreased income from our main India buyer due to its monetary standing. Concern round threat of second wave of COVID-19 an infection in lots of international locations, continues to have an effect on our income.
  • Web companies gross sales for the primary half of 2020 have been $4.Four million, a lower of 54.2% from $9.6 million within the corresponding interval in 2019. The lower was primarily as a result of obligatory shutdowns in India associated to the COVID-19 pandemic.

Gross Revenue

Gross revenue was $2.6 million, or 19.1% of internet gross sales, for the primary half of 2020, in comparison with $12.Zero million, or 31.2% of internet gross sales, within the corresponding interval in 2019.

  • Tools gross revenue for the primary half of 2020 was $3.2 million, in comparison with $8.9 million within the corresponding interval in 2019. Tools gross margin for the primary half of 2020 was 34.3%, in comparison with 30.7% for the corresponding interval in 2019. The rise in gross margin was attributed to favorable product combine.
  • Service gross margin for the primary half of 2020 was ($0.6) million, in comparison with $3.1 million within the corresponding interval in 2019. Service gross margin for the primary half of 2020 was (12.7%), in comparison with 32.5% for the corresponding interval in 2019. The lower in gross margin was primarily on account of one-time expense incurred in India.

Working Bills

Working bills for the primary half of 2020 have been $11.9 million, in comparison with $14.Four million within the corresponding interval in 2019.

  • Promoting, basic and administrative (“SG&A”) bills for the primary half of 2020 have been $7.5 million, in comparison with $7.Zero million within the corresponding interval in 2019. SG&A was larger within the first half of 2020 on account of larger accounts receivable allowance supplied for lengthy aged receivables throughout the interval for our India buyer, which partially offset by the decreased bills from continued tight price management.
  • Analysis and growth (“R&D”) bills for the primary half of 2020 have been $4.Four million, in comparison with $7.Four million within the corresponding interval in 2019. The lower mirrored decrease 5G investments on account of diminishing 5G prospects in China and decrease expenditure throughout the obligatory shutdowns associated to COVID-19.

Working Loss

Working loss for the primary half of 2020 was $9.Three million, in comparison with $2.Three million within the corresponding interval in 2019.

Curiosity Revenue, Web

Web curiosity earnings for the primary half of 2020 was $0.5 million, in comparison with $0.6 million within the corresponding interval in 2019.

Different Revenue (Bills), Web

Web different expense for the primary half of 2020 was $3.1 million, in comparison with internet different earnings of $4.Eight million within the corresponding interval in 2019. Different expense for the primary half of 2020 was primarily on account of international change losses ensuing from the devaluation of Indian Rupee towards the U.S. greenback.

Web Revenue (Loss)

Web loss attributable to shareholders for the primary half of 2020 was $12.Zero million, in comparison with internet earnings of $2.1 million within the corresponding interval in 2019. Fundamental internet loss per share for the primary half of 2020 was $0.34, in comparison with primary internet earnings per share of $0.06 for the corresponding interval in 2019.

Money Circulation

Money utilized in working actions within the first half of 2020 was $0.Eight million, money generated from investing actions was $2.Zero million, and money utilized in financing actions was $0.2 million. As of June 30, 2020, UTStarcom had money, money equal and restricted money of $48.6 million.

About UTStarcom Holdings Corp.

UTStarcom is dedicated to serving to community operators supply their clients essentially the most revolutionary, dependable and cost-effective communication companies. UTStarcom presents excessive efficiency superior tools optimized for essentially the most quickly rising community features, akin to cellular backhaul, metro aggregation and broadband entry. UTStarcom has operations and clients world wide, with a particular give attention to Japan and India. UTStarcom was based in 1991 and listed its shares on the Nasdaq Market in 2000 (image: UTSI). For extra details about UTStarcom, please go to http://www.utstar.com.

Ahead-Wanting Statements

This press launch contains forward-looking statements, together with statements relating to the Firm’s strategic initiatives and the Firm’s enterprise outlook. These statements are forward-looking in nature and topic to dangers and uncertainties which will trigger precise outcomes to vary materially and adversely from the Firm’s present expectations. These embody dangers and uncertainties associated to, amongst different issues, the impact of the COVID-19 pandemic on the Firm’s enterprise, modifications within the monetary situation and money place of the Firm, modifications within the composition of the Firm’s administration and their impact on the Firm, the Firm’s means to appreciate anticipated outcomes of operational enhancements and advantages of the divestiture transaction, the power to efficiently determine and purchase applicable applied sciences and companies for inorganic progress and to combine such acquisitions, the power to internally innovate and develop new merchandise, assumptions the Firm makes relating to the expansion of the market and the success of the Firm’s choices available in the market and the Firm’s means to execute its marketing strategy and handle regulatory issues. The dangers and uncertainties additionally embody the chance components recognized within the Firm’s newest annual report on Type 20-F and present studies on Type 6-Okay as filed with the Securities and Alternate Fee. The Firm is in a interval of strategic transition and the conduct of its enterprise is uncovered to extra dangers consequently. All forward-looking statements included on this press launch are primarily based upon data accessible to the Firm as of the date of this press launch, which can change and the Firm assumes no obligation to replace any such forward-looking statements.

For investor and media inquiries, please contact:

UTStarcom Holdings Corp.
Tel: +86 571 8192 8888
Ms. Ning Jiang, Investor Relations
Electronic mail: utsi-ir@utstar.com/ njiang@utstar.com /

In the USA:
The Blueshirt Group
Mr. Ralph Fong
Tel: +1 (415) 489-2195
Electronic mail: ralph@blueshirtgroup.com

UTStarcom Holdings Corp.
Unaudited Condensed Consolidated Stability Sheets

 June 30, December 31, 
 2020 2019 
     
 (In 1000’s) 
ASSETS      
Present property:      
Money and money equivalents$33,011 $34,966 
Quick-term investments   2,095 
Accounts and notes receivable, internet 64,157  77,831 
Inventories and deferred prices 7,289  6,655 
Quick-term restricted money 11,257  10,007 
Pay as you go and different present property 4,158  5,524 
Whole present property 119,872  137,078 
Lengthy-term property:      
Property, plant and tools, internet 842  1,092 
Working lease right-of-use property, internet 1,869  2,860 
Lengthy-term restricted money 4,377  3,634 
Different long-term property 6,614  6,639 
Whole long-term property 13,702  14,225 
Whole property$133,574 $151,303 
       
LIABILITIES AND EQUITY      
Present liabilities:      
Accounts payable$28,187 $30,875 
Buyer advances 217  160 
Deferred income 1,208  1,320 
Revenue tax payable 7,198  7,480 
Working lease liabilities, present 1,700  1,595 
Different present liabilities 6,600  7,603 
Whole present liabilities 45,110  49,033 
Lengthy-term liabilities:      
Working Lease liabilities, non-current 589  1,364 
Lengthy-term deferred income and different liabilities 1,411  1,718 
Whole liabilities 47,110  52,115 
       
Whole fairness 86,464  99,188 
Whole liabilities and fairness$133,574 $151,303 

UTStarcom Holdings Corp.
Unaudited Condensed Consolidated Statements of Operations

 Six months ended June 30, 
 2020 2019 
     
 (In 1000’s, besides per share information) 
Web gross sales$13,708 $38,562 
Value of internet gross sales 11,094  26,548 
Gross revenue 2,614  12,014 
  19.1% 31.2%
Working bills:      
Promoting, basic and administrative 7,549  6,983 
Analysis and growth 4,355  7,368 
Whole working bills 11,904  14,351 
       
Working loss (9,290) (2,337)
       
Curiosity earnings, internet 493  587 
Different earnings (expense), internet (3,103) 4,754 
Revenue (loss) earlier than earnings taxes (11,900) 3,004 
Revenue tax expense (142) (880)
Web Revenue (loss) attributable to UTStarcom
    Holdings Corp.
$(12,042)$2,124 
       
Web Revenue (loss) per share attributable to
    UTStarcom Holdings Corp.—Fundamental
$(0.34)$0.06 
Weighted common shares excellent—Fundamental 35,692  35,350 

UTStarcom Holdings Corp.
Unaudited Condensed Consolidated Statements of Money Flows

 Six months ended June 30, 
 2020 2019 
     
 (In 1000’s) 
CASH FLOWS FROM OPERATING ACTIVITIES:      
Web Revenue (loss)$(12,042)$2,124 
Depreciation 295  327 
Provision for uncertain accounts 2,477  1,260 
Inventory-based compensation expense 497  757 
Web acquire on disposal of property   (5)
Achieve on launch of tax legal responsibility on account of expiration of the statute of limitations   (1,128)
Deferred earnings taxes 116  4 
Achieve on write-off long-term account payable on account of expiration of the statute of limitations   (3,161)
Modifications in working property and liabilities 7,826  (18,308)
   Web money utilized in working actions (831) (18,130)
       
CASH FLOWS FROM INVESTING ACTIVITIES:      
Additions to property, plant and tools (85) (296)
Buy of short-term funding   (41)
Proceeds from short-term investments 2,095   
   Web money supplied by (utilized in) investing actions 2,010  (337)
       
CASH FLOWS FROM FINANCING ACTIVITIES:      
Proceeds from train of inventory choices   56 
Repurchase of unusual share (157) (850)
     Web money utilized in financing actions (157) (794)
Impact of change fee modifications on money and money equivalents (984) 658 
   Web improve (lower) in money and money equivalents 38  (18,603)
Money, money equivalents and restricted money at starting of interval 48,607  73,699 
Money, money equivalents and restricted money at finish of interval$48,645 $55,096 

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