UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2003
or
¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 000-31581
OPLINK COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
| Delaware |
No. 77-0411346 | |
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
3469 North First Street, San Jose, CA 95134
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (408) 433-0606
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes x No ¨
The number of shares of the Registrant’s common stock outstanding as of April 30, 2003 was 156,438,976.
FORM 10-Q
INDEX
| Page | ||
| PART I. FINANCIAL INFORMATION |
||
| Item 1. Financial Statements (unaudited): |
||
| Condensed Consolidated Balance Sheets—March 31, 2003 and June 30, 2002 |
3 | |
| Condensed Consolidated Statements of Operations—Three and nine months ended March 31, 2003 and 2002 |
4 | |
| Condensed Consolidated Statements of Cash Flows—Nine months ended March 31, 2003 and 2002 |
5 | |
| 7 | ||
| Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations |
18 | |
| Item 3. Quantitative and Qualitative Disclosures About Market Risk |
52 | |
| 52 | ||
| PART II. OTHER INFORMATION |
||
| 53 | ||
| 54 | ||
| 54 | ||
| 54 | ||
| 54 | ||
| 55 | ||
| 56 |
2
Item 1. Financial Statements
OPLINK COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
| March 31, 2003 |
June 30, 2002 |
|||||||
| (Unaudited) |
(1) |
|||||||
| ASSETS |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ |
115,812 |
|
$ |
219,033 |
| ||
| Short-term investments |
|
86,650 |
|
|
5,716 |
| ||
| Accounts receivable, net |
|
4,764 |
|
|
6,831 |
| ||
| Inventories |
|
5,037 |
|
|
6,551 |
| ||
| Prepaid expenses and other current assets |
|
2,655 |
|
|
3,571 |
| ||
| Total current assets |
|
214,918 |
|
|
241,702 |
| ||
| Property, plant and equipment, net |
|
44,787 |
|
|
59,732 |
| ||
| Intangible assets |
|
135 |
|
|
500 |
| ||
| Other assets |
|
1,085 |
|
|
1,260 |
| ||
| Total assets |
$ |
260,925 |
|
$ |
303,194 |
| ||
| LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||
| Current liabilities: |
||||||||
| Accounts payable |
$ |
7,076 |
|
$ |
5,412 |
| ||
| Accrued liabilities |
|
10,676 |
|
|
13,316 |
| ||
| Current portion of capital lease obligations |
|
2,462 |
|
|
4,291 |
| ||
| Total current liabilities |
|
20,214 |
|
|
23,019 |
| ||
| Capital lease obligations, non current |
|
209 |
|
|
1,570 |
| ||
| Accrued restructuring, non current |
|
1,764 |
|
|
5,324 |
| ||
| Total liabilities |
|
22,187 |
|
|
29,913 |
| ||
| Commitments and contingencies (Note 14) |
||||||||
| Stockholders’ equity: |
||||||||
| Common stock |
|
156 |
|
|
165 |
| ||
| Additional paid-in capital |
|
459,738 |
|
|
472,393 |
| ||
| Treasury stock |
|
(713 |
) |
|
(1,895 |
) | ||
| Notes receivable from stockholders |
|
(11,286 |
) |
|
(10,771 |
) | ||
| Deferred stock compensation |
|
(1,803 |
) |
|
(5,425 |
) | ||
| Accumulated other comprehensive (loss) income |
|
(17 |
) |
|
26 |
| ||
| Accumulated deficit |
|
(207,337 |
) |
|
(181,212 |
) | ||
| Total stockholders’ equity |
|
238,738 |
|
|
273,281 |
| ||
| Total liabilities and stockholders’ equity |
$ |
260,925 |
|
$ |
303,194 |
| ||
(1) The Condensed Consolidated Balance Sheet at June 30, 2002 has been derived from the audited financial statements at that date.
The accompanying notes are an integral part of these condensed consolidated financial statements.
3
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
| Three Months Ended March 31, |
Nine Months Ended March 31, |
|||||||||||||||
| 2003 |
2002 |
2003 |
2002 |
|||||||||||||
| Revenues |
$ |
5,622 |
|
$ |
9,598 |
|
$ |
16,742 |
|
$ |
30,236 |
| ||||
| Cost of revenues: |
||||||||||||||||
| Cost of revenues |
|
5,063 |
|
|
9,244 |
|
|
18,234 |
|
|
41,760 |
| ||||
| Non-cash compensation (recovery) expense |
|
(39 |
) |
|
200 |
|
|
(653 |
) |
|
47 |
| ||||
| Total cost of revenues |
|
5,024 |
|
|
9,444 |
|
|
17,581 |
|
|
41,807 |
| ||||
| Gross profit (loss) |
|
598 |
|
|
154 |
|
|
(839 |
) |
|
(11,571 |
) | ||||
| Operating expenses: |
||||||||||||||||
| Research and development: |
||||||||||||||||
| Research and development |
|
1,725 |
|
|
3,204 |
|
|
7,380 |
|
|
10,595 |
| ||||
| Non-cash compensation (recovery) expense |
|
(5 |
) |
|
352 |
|
|
(178 |
) |
|
675 |
| ||||
| Total research and development |
|
1,720 |
|
|
3,556 |
|
|
7,202 |
|
|
11,270 |
| ||||
| Sales and marketing: |
||||||||||||||||
| Sales and marketing |
|
595 |
|
|
2,304 |
|
|
3,518 |
|
|
6,394 |
| ||||
| Non-cash compensation expense (recovery) |
|
84 |
|
|
186 |
|
|
106 |
|
|
(499 |
) | ||||
| Total sales and marketing |
|
679 |
|
|
2,490 |
|
|
3,624 |
|
|
5,895 |
| ||||
| General and administrative: |
||||||||||||||||
| General and administrative |
|
1,828 |
|
|
1,713 |
|
|
5,387 |
|
|
5,611 |
| ||||
| Non-cash compensation expense |
|
254 |
|
|
1,035 |
|
|
1,396 |
|
|
2,960 |
| ||||
| Total general and administrative |
|
2,082 |
|
|
2,748 |
|
|
6,783 |
|
|
8,571 |
| ||||
| Restructuring costs and other special charges |
|
— |
|
|
— |
|
|
9,280 |
|
|
25,643 |
| ||||
| Merger fees |
|
— |
|
|
1,425 |
|
|
1,300 |
|
|
1,425 |
| ||||
| Amortization of intangible assets |
|
15 |
|
|
42 |
|
|
63 |
|
|
126 |
| ||||
| Total other operating expenses |
|
15 |
|
|
1,467 |
|
|
10,643 |
|
|
27,194 |
| ||||