Utstarcom Holdings Corp · NASDAQ:UTSI
Utstarcom — FY2013 Earnings Presentation
31 slides from Utstarcom's earnings presentation, Mar 20, 2014
Slide 1: Fourth Quarter and Full Year 2013 Results
UTStarcom Holdings Corp. Fourth Quarter and Full Year 2013 Results NASDAQ: UTSI March 20, 2014 Mr. William Wong, CEO Mr. James Lu, President Mr. Robert Pu, CFO 1
Slide 2: Disclosure & Forward Looking Statements
Disclosure & Forward Looking Statements This investor presentation contains forward-looking statements, including statements regarding the Company's expectation regarding its strategic initiatives and business outlook. Forward-looking statements are based on current expectations, estimates, forecast
Slide 3: Earnings Call Agenda
3 Earnings Call Agenda Introduction Update on Operating Progress Update on Shareholder Value Initiatives Our Go-forward Strategy Global Sales & Marketing Growth Plan and Recent Customer Wins Overview of Fourth Quarter and Full Year 2013 Results Company Outlook 1 2 3 4 5 6 7
Slide 4: Introduction
1 Introduction 4
Slide 5: Introduction
Introduction 5 Ended 2013 on a very strong note, both financially and operationally. Reached several technical and financial milestones and are carving out a highly differentiated market position for our broadband business. We achieved new customer wins, new product launches and stabilizing financia
Slide 6: Introduction: Restructuring the Business
Introduction 6 Took several decisive steps to restructure the business Completed divestitures of unprofitable and non-core businesses. Staff reductions and deep cost cuts. Invest in and grow our broadband business - the future of the Company. UTStarcom is now a much leaner organization with a well-d
Slide 7: Update on Operating Progress
2 Update on Operating Progress 7
Slide 8: Driving The Broadband Business
Driving The Broadband Business 8 Demonstrated our “simple network, simple operation” philosophy to help our carrier customers to deploy new networks, offer new revenue-generating services and run their networks more efficiently. The Company launched a number of new products right on schedule: TN765,
Slide 9: Making Smart Strategic Investment in New Media
Making Smart Strategic Investment in New Media 9 iTV Media Continued to flourish in the first commercial launch of its flagship product, through a strategic partnership with national telecommunications provider, TOT. 160K subscribers as of the end of 2013. Customer satisfaction rates for this servic
Slide 10: Update on Shareholder Value Initiatives
3 Update on Shareholder Value Initiatives 10
Slide 11: Returning Cash to Shareholders
Concluded several important initiatives to enhance shareholder value as part of the Company’s longstanding commitment to shareholders. Returned approximately $45 million to shareholders through the end of 2013, inclusive of a stock buyback plan and tender offer: In January 2013 completed a $30 milli
Slide 12: Our Go-forward Strategy
4 Our Go-forward Strategy 12
Slide 13: Our post-restructuring plan includes several specific initiatives
Our post-restructuring plan includes several specific initiatives: We will bolster our broadband business by undertaking the following: Refresh our marketing and sales initiatives to broaden our presence globally including Asia, U.S. and Europe. Will harness our in-house R&D capabilities to stay on
Slide 14: Global Sales & Marketing Growth Plan and Recent Customer Wins
5 Global Sales & Marketing Growth Plan and Recent Customer Wins 14
Slide 15: Three Pronged Marketing & Sales Plan
Deepen penetration into existing commercial markets Develop and source additional synergistic products for existing customers. Develop new customers especially in large markets where there are multiple tier-one carriers. Enter new geographic markets with our existing customers as they expand beyond
Slide 16: Recent Customer Wins Around The World
We signed a long-term contract to supply Chunghwa Telecom in Taiwan for a major packet optical transport installation that will last up to three years. In Indonesia, we have secured a major packet optical transport project that will support mobile backhaul services for the country’s largest cellular
Slide 17: Multinational Sales & Marketing Network
Multinational Sales & Marketing Network 17
Slide 18: Overview of Fourth Quarter and Full Year 2013 Results
Overview of Fourth Quarter and Full Year 2013 Results 18
Slide 19: Summary Overview Non-GAAP Key Financial Highlights
19 Summary Overview Non-GAAP Key Financial Highlights Non-GAAP Key Financial; Highlights Revenue for full year 2013 increased incrementally on a year-over-year basis. Continued to benefit from aggressive and focused cost reduction efforts, as demonstrated by the significant decease in OPEX for the y
Slide 20: Non-GAAP Total Revenue
Non-GAAP Total Revenue Non-GAAP total revenues for the fourth quarter of 2013 were $38.0 million, a decrease of 7.3% from $41.0 million for the corresponding period of 2012. 20 Non-GAAP total revenues for the year ended December 31, 2013 were $163.0 million, an increase of 3.7% from $157.3 million f
Slide 21: Non-GAAP Gross Profit
Non-GAAP Gross Profit 21 Non-GAAP gross profit was $7.2 million for the fourth quarter of 2013, compared to $13.3 million for the corresponding period of 2012. Non-GAAP gross profit was $40.2 million for the year ended December 31, 2013, compared to $54.0 million for the year ended December 31, 2012
Slide 22: Non-GAAP Gross Margin
Non-GAAP Gross Margin 22 Non-GAAP gross margin was 18.8% for the fourth quarter of 2013, compared to 32.4% for the corresponding period of 2012. Non-GAAP gross margin was 24.7% for the year ended December 31, 2013, compared to 34.3% for the year December 31, 2012.
Slide 23: Non-GAAP Operating Expenses
Non-GAAP Operating Expenses 23 Non-GAAP operating expenses were $15.7 million for the fourth quarter of 2013, a decrease of 1.1% from $15.9 million for the corresponding period of 2012. Non-GAAP operating expenses were $53.4 million for the year ended December 31, 2013, a decrease of 20.2% year-over
Slide 24: Non-GAAP Operating Income (Loss)
Non-GAAP Operating Income (Loss) 24 Non-GAAP operating loss was $8.6 million for the fourth quarter of 2013, compared to operating loss of $2.6 million for the corresponding period of 2012. Non-GAAP operating loss was $13.2 million for the year ended December 31, 2013, compared to operating loss of
Slide 25: Non-GAAP Net Income (Loss)
Non-GAAP Net Income (Loss) 25 Non-GAAP net loss was $16.1 million for the fourth quarter of 2013, compared to net loss of $8.0 million for the corresponding period of 2012. US$ in millions Non-GAAP net loss was $22.7 million for the year ended December 31, 2013, compared to net loss of $17.6 million
Slide 26: Cash Flow Analysis
Cash balance of $107.8 million in cash, cash equivalents and short-term investment. Cash used in operating activities for the full year was $1.9 million. Cash used in investing activities for the full year was $28.9 million. Cash used in financing activities for the full year was $30.7 million, main
Slide 27: Non-GAAP Operating Cash Flow
Non-GAAP Operating Cash Flow 27 Non-GAAP net cash used in operating activities was $3.8 million for the fourth quarter of 2013, compared to $6.4 million for the corresponding period of 2012. Non-GAAP net cash used in operating activities was $1.9 million for the year ended December 31, 2013, compare
Slide 28: A View on Valuation
We believe our valuation should most appropriately be equal to the sum of parts that include our net cash position, the enterprise value of our broadband business, and the economic value of our strategic investments: We have $107.8 million in cash and no debt. In terms of enterprise value, we compet
Slide 29: Company Outlook
Company Outlook 29
Slide 30: Company Outlook
30 In 2014, the Company will move through a continued transition. New products are in early stages of their product life cycle and new customer wins are going through project deployment phases. The Company is fully committed to broadband as the driver of our business and new products will become sig
Slide 31: Investor Relations Contacts
Investor Relations Contacts UTStarcom, Investor Relations Jane Zuo Email: jane.zuo@utstar.com FTI Consulting, Inc. May Shen (Beijing) Tel: +86-10-8591-1951 Email: May.Shen@fticonsulting.com Daniel DelRe (Hong Kong) Tel: +852-3768-4547 Email: Daniel.DelRe@fticonsulting.com Simona Kormanikova (New Yor