Ceragon Updates First Quarter Revenue Guidance; Expects to Receive $17 Million
Settlement in Second Quarter
Significant improvement in Q1 bookings; company chose not to ship certain
order pending renegotiation of payment terms with a customer
Conference call today at 9am EDT
PARAMUS, N.J., April 2, 2014
PARAMUS, N.J., April 2, 2014 /PRNewswire/ --Ceragon Networks Ltd.
(NASDAQ:CRNT), the #1 high-capacity wireless hauling specialist, today
announced updated revenue guidance for the first quarter of 2014 in the range
of $70 million to $73 million, below the company's earlier guidance of $83
million to $93 million, primarily due to the company's decision not to ship
and install equipment for a certain customer until completing the
renegotiation of payment terms. A secondary factor affecting Q1 revenue was a
higher than expected proportion of IP-20 products in Q1 bookings. Some of the
orders were received too late in the quarter to ship within the quarter
because manufacturing for the new products was ramping and had not reached
full productivity. Final results for the first quarter will be released on May
8, 2014. The company also announced a settlement agreement pursuant to which
it expects to receive $17 million in cash during the second quarter of 2014.
"Our revised revenue expectations for the first quarter are unrelated to
demand, which is improving," said Ira Palti, President and CEO of Ceragon.
"Bookings increased over 25% sequentially in Q1, to a level above the high end
of our original revenue guidance. Thus, our book-to-bill ratio improved
significantly, even though Q1 is typically a seasonally weaker quarter for
bookings. "Meanwhile, we have been in discussions with one of our large,
valued customers, and we decided not to ship and install an order we received
in Q4 until we renegotiate payment terms. This is a satisfied customer that is
growing rapidly and we expect to resume shipping to them once we have agreed
on mutually acceptable terms.
"We are delighted to see this early strength in bookings for IP-20 products,
which represented over 40% of bookings in Q1, compared to only 15% in the
fourth quarter of 2013," Palti continued. "We have been ramping production as
quickly as possible to meet the demand."
Settlement Agreement Signed
On April 1, 2014, Ceragon signed an agreement with Eltek ASA, to settle all
claims, counter claims, legal proceedings, and any other contingent or
potential claims regarding alleged breaches of representations and warranties
contained in the purchase agreement governing Ceragon's acquisition of Nera
Networks from Eltek in January 2011. Pursuant to the settlement agreement,
Ceragon expects to receive $17 million in cash during the second quarter of
Conference Call Details
A conference call discussing these developments will take place today
beginning at 9:00 a.m. EDT. Investors are invited to join the Company's
teleconference by calling USA: (800) 230-1074 or International: +1 (612)
288-0337 from 08:50 a.m. EDT. The call-in lines will be available on a
first-come, first-serve basis.
Investors can also listen to the call live via the Internet by accessing
Ceragon Networks' website at the investors' page selecting the webcast link,
and following the registration instructions.
If you are unable to join us live, the replay numbers are: USA: (800) 475-6701
or International: +1 (320) 365-3844, Access Code: 323148. A replay of both the
call and the webcast will be available through May 2, 2014.
About Ceragon Networks Ltd.
Ceragon Networks Ltd. (NASDAQ: CRNT) is the #1 high-capacity wireless hauling
specialist. We provide innovative, flexible and cost-effective wireless
backhaul and fronthaul solutions that enable mobile operators and other
wired/wireless service providers to deliver 2G/3G, 4G/LTE and other broadband
services to their subscribers. Ceragon's high-capacity, solutions use
microwave technology to transfer voice and data traffic while maximizing
bandwidth efficiency, to deliver more capacity over longer distances under any
deployment scenario. Based on our extensive global experience, Ceragon
delivers turnkey solutions that support service provider profitability at
every stage of the network lifecycle enabling faster time to revenue,
cost-effective operation and simple migration to all-IP networks. As the
demand for data pushes the need for ever-increasing capacity, Ceragon is
committed to serve the market with unmatched technology and innovation,
ensuring effective solutions for the evolving needs of the marketplace. Our
solutions are deployed by more than 430 service providers in over 130
Ceragon Networks® and FibeAir® are registered trademarks of Ceragon Networks
Ltd. in the United States and other countries. CERAGON ® is a trademark of
Ceragon Networks Ltd., registered in various countries. Other names mentioned
are owned by their respective holders.
This press release may contain statements concerning Ceragon's future
prospects that are "forward-looking statements" under the Private Securities
Litigation Reform Act of 1995. These forward-looking statements are subject
to risks and uncertainties that may cause actual results to differ materially,
including risks associated with doing business in Latin America, including
currency export controls and recent economic concerns, the risks relating to
the concentration of our business in developing nations, the risk of
significant expenses in connection with potential contingent tax liability
associated with Nera's prior operations or facilities, risks associated with
increased working capital needs, and other risks and uncertainties detailed
from time to time in Ceragon's Annual Report on Form 20-F and Ceragon's other
filings with the Securities and Exchange Commission, and represent our views
only as of the date they are made and should not be relied upon as
representing our views as of any subsequent date. We do not assume any
obligation to update any forward-looking statements.
Aviram Steinhartor Claudia Gatlin
+972 3 5431 443 +1 201 853 0228
+972 3 5431 32 or
+1 201 853 0271
SOURCE Ceragon Networks Ltd.
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