Oplink Reports Second Quarter Fiscal Year 2013 Financial Results

Oplink Reports Second Quarter Fiscal Year 2013 Financial Results

FREMONT, Calif., Jan. 31, 2013 (GLOBE NEWSWIRE) -- Oplink Communications, Inc.
(Nasdaq:OPLK), a leading provider of design, integration and optical
manufacturing solutions (OMS) for optical networking components, modules and
subsystems, today reported its financial results for its second quarter of
fiscal year 2013, ended December 30, 2012.

Revenues for the quarter were $45.1 million and GAAP net income was $3.5
million, or $0.18 per diluted share. This compares to revenues of $44.9
million and a GAAP net income of $3.4 million, or $0.17 per diluted share,
reported in the prior quarter, and revenues of $43.3 million and GAAP net loss
of $1.5 million, or $(0.08) per share, reported in the same period of the
prior year.

Non-GAAP net income for the second quarter was $4.6 million, or $0.24 per
diluted share, as compared to $5.0 million, or $0.26 per diluted share,
reported in the prior quarter, and $2.0 million, or $0.10 per diluted share,
reported in the same period of the prior year.

Oplink generated $2.4 million in cash from operations, used $5.7 million for
stock repurchases, and $6.9 million for capital expenditures. The Company
closed the quarter with cash, cash equivalents and short-term and long-term
investments of $166.7 million.

"We are pleased with our solid results in the quarter, with steady revenues in
our optics business," commented Joe Liu, Chairman and CEO of Oplink. "We
continued to work closely with our customers on optical design-in
opportunities while investing in key areas for future growth. Also in the
quarter, we announced the commercial availability of our first
Smartphone-centric remote interactive plug-n-play alarm and surveillance
system, and are encouraged by market feedback from prospective channels and
partners. We are optimistic about the business opportunities ahead."

Business Outlook for the Quarter Ending March 31, 2013

For the quarter ending March 31, 2013, the Company expects to report revenues
between $42 million and $45 million and GAAP net income per diluted share of
approximately $0.09 to $0.15. On a non-GAAP basis, excluding stock
compensation, amortization of intangible assets and any other non-cash or
non-recurring charges, the Company expects earnings per diluted share of
approximately $0.15 to $0.21. GAAP and non-GAAP net income per diluted share
for the quarter ending March 31, 2013 assume an effective tax rate of 20%.

Conference Call Information

Oplink will host a corresponding conference call and live webcast at 2:00 p.m.
Pacific Time on January 31, 2013. The conference call can be accessed by
dialing 1-877-941-8416, or 1-480-629-9808 (outside the U.S. and Canada). A
live webcast will be available on the Investors section of Oplink's corporate
website at www.oplink.com and via replay beginning approximately two hours
after the completion of the call until Oplink's announcement of its financial
results for the next quarter. An audio replay of the call will also be
available to investors beginning at approximately 5:00 p.m. Pacific Time on
January 31, 2013 until 11:59 p.m. Pacific Time on February 7, 2013, by dialing
1-800-406-7325 or 1-303-590-3030 (outside the U.S. and Canada) and entering
pass code 4592343#.

Non-GAAP Financial Measures

In this earnings release and during the earnings conference call and webcast
as described above, Oplink will discuss certain non-GAAP financial measures.
Generally, a non-GAAP financial measure is a numerical measure of a company's
performance, financial position, or cash flows that either excludes or
includes amounts that are not normally excluded or included in the most
directly comparable measure calculated and presented in accordance with GAAP.
A reconciliation between non-GAAP and GAAP measures can be found in the
accompanying tables.

Oplink believes that providing these non-GAAP measures to its investors
provides investors the benefit of viewing Oplink's performance using the same
financial metrics that the management team uses in making many key decisions
and evaluating how Oplink's "core operating performance" and its results of
operations may look in the future. Oplink defines "core operating performance"
as its on-going performance in the ordinary course of its operations. Items
that are non-recurring or do not involve cash expenditures, such as one-time
tax benefits or charges, impairment charges, restructuring charges,
amortization of intangible assets and non-cash compensation related to stock
and options, are not included in Oplink's view of "core operating
performance."

About Oplink

Incorporated in 1995, Oplinkis a leading provider of design, integration and
optical manufacturing solutions (OMS) for optical networking components,
modules and subsystems. Oplinkoffers advanced and cost-effective
optical-electrical components and subsystem manufacturing through its
facilities in Zhuhai andShanghai, China. In addition,Oplink maintains
optical-centric front-end design, application, and customer service functions
at its offices inFremont, Californiaand has research facilities in Zhuhai
andWuhan, China and Hsinchu Science-Based Industrial Park
inTaiwan.Oplink'scustomers include telecommunications, data communications
and cable TV equipment manufacturers around the globe.Oplinkis committed to
providing fully customized, photonic foundry services incorporating its
subsystems manufacturing capabilities. To learn more aboutOplink, visit its
web site at:http://www.oplink.com/.

Cautionary Statement

This press release contains forward-looking statements, including without
limitation the statements under the heading "Business Outlook for the Quarter
Ending March 31, 2013." These forward-looking statements involve risks and
uncertainties that could cause Oplink's results to differ materially from
those expressed or implied by such forward-looking statements, including the
following risks and uncertainties: (1) possible reductions in customer orders
or delays in shipments of products to customers; (2) potential delays in
introduction of new Oplink products; (3) Oplink's reliance on a small number
of customers for a substantial portion of its revenues; (4) Oplink's reliance
on third parties to supply critical components and materials for its products;
(5) intense competition in Oplink's target markets and potential pricing
pressure that may arise from changing supply or demand conditions in the
industry; (6) risks relating to the new Mobile Interactive business, including
the risk that the products and services, being new and unproven, may not
achieve market acceptance, the risk that Oplink may not be successful in
developing adequate sales channels for these products and services, and the
risk of write-downs for slow-moving or obsolete inventory ; (7) changes in our
effective tax rate, which could reduce our net income; and (8) other risks
detailed from time to time in Oplink's periodic reports filed with the
Securities and Exchange Commission, including the Company's latest Annual
Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on
Form 8-K.

The foregoing information represents Oplink's outlook only as of the date of
this press release, and Oplink undertakes no obligation to update or revise
any forward-looking statements, whether as a result of new developments or
otherwise.


OPLINK COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
                                                            
                                         December 30,        July 1,
                                         2012                2012
                                         (Unaudited)         (1)
ASSETS                                                       
Current assets:                                              
Cash and cash equivalents                $59,289            $81,233
Short-term investments                    107,151             85,382
Accounts receivable, net                  39,479              33,165
Inventories                               20,028              19,091
Prepaid expenses and other current assets 7,569               8,633
Deferred tax assets                       1,612               1,609
Total current assets                      235,128             229,113
Property, plant and equipment, net        50,569              45,392
Long-term investments                     243                 9,606
Goodwill and intangible assets, net       1,395               1,648
Deferred tax assets                       7,583               7,151
Other assets                              12,577              12,279
Total assets                              $307,495           $305,189
                                                            
LIABILITIES AND STOCKHOLDERS' EQUITY                         
Current liabilities:                                         
Accounts payable                          $10,832            $11,739
Accrued liabilities and other current     13,958              12,460
liabilities
Total current liabilities                 24,790              24,199
Non-current liabilities                   9,337               8,858
Total liabilities                         34,127              33,057
Stockholders' equity                      273,368             272,132
Total liabilities and stockholders'       $307,495           $305,189
equity
                                                            
(1) The July 1, 2012 condensed consolidated balance sheet has been derived
from audited consolidated financial statements at that date.



OPLINK COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
                Three Months Ended                  Six Months Ended
                December 30, September   January 1,  December 30, January 1,
                              30,
                2012         2012        2012        2012         2012
                (Unaudited)  (Unaudited) (Unaudited) (Unaudited)  (Unaudited)
                                                              
Revenues         $45,099     $44,884    $43,328    $89,983     $86,705
Cost of revenues 28,570       28,254      29,977      56,824       59,234
Gross profit     16,529       16,630      13,351      33,159       27,471
Operating                                                      
expenses:
Research and     5,829        5,432       5,049       11,261       10,024
development
Sales and        3,348        3,212       2,508       6,560        5,096
marketing
General and      2,109        2,154       6,344       4,263        8,953
administrative
Stock
compensation     1,045        1,863       1,169       2,908        2,921
expense
Amortization of
intangible       91           91          166         182          482
assets
Gain on
sale/disposal of (5)          (7)         (8)         (12)         (385)
assets
Total operating  12,417       12,745      15,228      25,162       27,091
expenses
Income (loss)    4,112        3,885       (1,877)     7,997        380
from operations
Interest and
other income,    412          266         203         678          316
net
Income (loss)
before provision 4,524       4,151      (1,674)    8,675       696
(benefit) for
income taxes
Provision
(benefit) for    (1,068)     (788)      181        (1,856)      (966)
income taxes
Net income       $3,456     $3,363    $(1,493)  $6,819     $(270)
(loss)
                                                              
Net income
(loss) per                                                     
share:
Basic            $0.18      $0.18     $(0.08)   $0.36      $(0.01)
Diluted          $0.18      $0.17     $(0.08)   $0.35      $(0.01)
                                                              
Shares used in
per share                                                      
calculation:
Basic            19,107       19,080      19,185      19,093       19,446
Diluted          19,277       19,425      19,185      19,395       19,446
                                                              
                                                              
RECONCILIATION OF GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL MEASURES
(unaudited, in thousands, except per share amounts)
                Three Months Ended                  Six Months Ended
                December 30, September   January 1,  December 30, January 1,
                              30,
Reconciliation
of GAAP net      2012         2012        2012        2012         2012
income (loss)
to
non-GAAP net     (Unaudited)  (Unaudited) (Unaudited) (Unaudited)  (Unaudited)
income:
Net income       $3,456     $3,363    $(1,493)  $6,819     $(270)
(loss), GAAP
Adjustments to
measure                                                        
non-GAAP:
Related to cost                                                
of revenues:
Stock
compensation     49           123         89          172          198
expense
Amortization of
intangible       36           36          161         72           572
assets
Total related to 85           159         250         244          770
cost of revenues
                                                              
Related to
operating                                                      
expenses:
Legal            --           --          3,317       --           3,317
settlement
Stock
compensation     1,045        1,863       1,169       2,908        2,921
expense
Amortization of
intangible       91           91          166         182          482
assets
Total related to
operating        1,136        1,954       4,652       3,090        6,720
expenses
                                                              
Tax effects on
non-GAAP         (112)        (517)       (1,424)     (629)        (2,119)
adjustments
                                                              
Non-GAAP net     $4,565     $4,959    $1,985    $9,524     $5,101
income
                                                              
Net income per                                                 
share, non-GAAP:
Basic            $0.24      $0.26     $0.10     $0.50      $0.26
Diluted          $0.24      $0.26     $0.10     $0.49      $0.25
                                                              
Shares used in
per share                                                      
calculation:
Basic            19,107       19,080      19,185      19,093       19,446
Diluted          19,277       19,425      19,716      19,395       20,075
                                                              
Reconciliation
of GAAP gross                                                  
profit
to non-GAAP                                                    
gross profit:
GAAP gross       $16,529    $16,630   $13,351   $33,159    $27,471
profit
Stock
compensation
expense included 49           123         89          172          198
in cost of
revenues
Amortization of
intangible
assets included  36           36          161         72           572
in cost of
revenues
Non-GAAP gross   $16,614    $16,789   $13,601   $33,403    $28,241
profit
                                                              
GAAP gross       36.7%        37.1%       30.8%       36.9%        31.7%
margin rate
Non-GAAP gross   36.8%        37.4%       31.4%       37.1%        32.6%
margin rate
                                                              


OPLINK COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
                                                      Six Months Ended
                                                      December 30, January 1,
                                                      2012         2012
                                                      (Unaudited)
Cash flows from operating activities:                              
Net income (loss)                                      $6,819      $(270)
Adjustments to reconcile net income (loss) tonet cash             
provided by operating activities:
Depreciation and amortization                          3,593        3,007
Amortization of intangible assets                      254          1,046
Stock compensation expense                            3,080        3,118
Deferred income taxes                                  6            624
Gain on sale/disposal of assets                        (12)         (385)
Other                                                  110          207
Change in assets and liabilities                       (3,695)      4,454
Net cash provided by operating activities              10,155      11,801
                                                                  
Cash flows from investing activities:                              
Net (purchases) maturities of investments              (15,976)     13,684
Net purchases of property, plant and equipment         (8,312)      (5,415)
Sales (purchases) of cost or equity investments        214          (200)
Business acquisition                                   (1,090)      --
Net cash (used in) provided by investing activities   (25,164)     8,069
                                                                  
Cash flows from financing activities:                              
Proceeds from issuance of common stock                2,260        866
Repurchase of common stock                             (9,286)      (19,703)
Net cash used in financing activities                  (7,026)      (18,837)
                                                                  
Effect of exchange rate changes on cash and cash       91           (150)
equivalents
Net (decrease) increase in cash and cash equivalents   (21,944)     883
Cash and cash equivalents, beginning of period         81,233       52,644
Cash and cash equivalents, end of period               $59,289     $53,527

CONTACT: Investor Relations:
         Erica Abrams
         415-217-5864
         erica@blueshirtgroup.com
        
         Matthew Hunt
         415-489-2194
         matt@blueshirtgroup.com