Vistance Networks, Inc. · NASDAQ:VISN
Vistance Networks — Q3 2018 Earnings Presentation
18 slides from Vistance Networks's earnings presentation, Nov 8, 2018
Slide 1: Third Quarter 2018 Results
Third Quarter 2018 Results November 8, 2018
Slide 2: Safe Harbor
Safe Harbor Caution Regarding Forward Looking Statements This presentation any other oral or written statements made by us or on our behalf may include forward-looking statements that reflect our current views with respect to future events and financial performance. These forward-looking statements
Slide 3: Agenda
Agenda • Third quarter 2018 results • Cash flow and liquidity • Identifying growth opportunities • Fourth quarter and full year 2018 outlook 3 3
Slide 4: Q3 2018 Results
Q3 2018 Results Revenue Operating Income(1) Diluted Earnings Per Share (in millions) (in millions) 1.9% +7.3% (1.4%) Adjusted(2) Adjusted(2) $1,240 $165 $251 $0.68 $0.59 $1,150 $222 $0.55 $1,129 $125 $132 $219 $0.34 $0.26 $0.33 GAAP GAAP Q2 2018 Q3 2017 Q3 2018 Q2 2018 Q3 2017 Q3 2018 Q2 2018 Q3 201
Slide 5: CommScope Connectivity Solutions (CCS)
CommScope Connectivity Solutions (CCS) Revenue Operating Income(1) (in millions) (in millions) +3.2% +6.4% Adjusted(2) $740 $709 $732 $143 $139 $95 $147 $85 GAAP $70 Q2 2018 Q3 2017 Q3 2018 Q2 2018 Q3 2017 Q3 2018 • High-single-digit growth in the North America market, partially offset by declines i
Slide 6: CommScope Mobility Solutions (CMS)
CommScope Mobility Solutions (CMS) Revenue Operating Income(1) (in millions) (in millions) (0.3%) (14.4%) Adjusted(2) $499 $79 $420 $419 $108 $55 $84 $72 GAAP $37 Q2 2018 Q3 2017 Q3 2018 Q2 2018 Q3 2017 Q3 2018 • Growth in the North America market and EMEA region, partially offset by declines in the
Slide 7: Cash Flow and Liquidity
Cash Flow and Liquidity Repaid $400 million in debt in Q3 – Total of $1.4 billion since BNS acquisition – Net leverage down to 3.9x (in millions) Q3 2017 Q3 2018 LTM Q3 2017 LTM Q3 2018 Cash flow from operations $ 145 $ 227 $ 425 $ 613 Capital expenditures, net of capex related to BNS integration (2
Slide 8: Outlook
Outlook (1) Q4 2018 Guidance Full Year 2018 Guidance • Sales of $1.015 billion - $1.065 billion • Sales of $4.525 billion - $4.575 billion • Operating income of $60 million - $83 million • Operating income of $461 million - $484 • Non-GAAP adjusted operating income of million $145 million - $170 mil
Slide 9: Appendix: Non-GAAP Financial Measures
Appendix Non-GAAP Financial Measures CommScope management believes that presenting certain non-GAAP financial measures provides meaningful information to investors in understanding operating results and may enhance investors' ability to analyze financial and business trends. Non-GAAP measures are no
Slide 10: Statements of Operations
Statements Thre e Months Ende d Nine Months Ende d of Operations Se pte mbe r 30, Se pte mbe r 30, 2018 2017 2018 2017 Net sales $ 1,150,405 $ 1,128,775 $ 3,510,778 $ 3,440,150 Operating costs and expenses: Cost of sales 726,531 700,170 2,204,194 2,085,973 Selling, general and administrative 173,990
Slide 11: Balance Sheets
Balance Sheets Se pte mbe r 30, 2018 De ce mbe r 31, 2017 Assets Cash and cash equivalents $ 352,397 $ 453,977 Accounts receivable, less allowance for doubtful accounts of $18,141 and $13,976, respectively 901,096 898,829 Inventories, net 490,767 444,941 Prepaid expenses and other current assets 123
Slide 12: Statements of Cash Flows
Statements of Thre e Months Ende d Nine Months Ende d Se pte mbe r 30, Se pte mbe r 30, 2018 2017 2018 2017 Operating Activities: Cash Flows Net income $ 63,843 $ 51,157 $ 163,500 $ 140,183 Adjustments to reconcile net income to net cash generated by operating activities: Depreciation and amortizati
Slide 13: Sales by Region
Sales by Region (Unaudited -- In millions) % Change Q3 2018 Q3 2017 YOY United States $ 653.0 $ 595.3 9.7 % Europe, Middle East and Africa 235.6 231.0 2.0 Asia Pacific 179.3 218.6 (18.0) Caribbean and Latin America 59.4 62.2 (4.5) Canada 23.1 21.7 6.5 Total Net Sales $ 1,150.4 $ 1,128.8 1.9 % 13
Slide 14: Segment Information
Segment Information (Unaudited -- In millions) Sales by Segment % Change Q3 2018 Q2 2018 Q3 2017 S equential YOY Connectivity Solutions $ 731.7 $ 740.5 $ 708.7 (1.2) % 3.2 % Mobility Solutions 418.7 499.4 420.1 (16.2) % (0.3) % Total Net Sales $ 1,150.4 $ 1,239.9 $ 1,128.8 (7.2) % 1.9 % Non-GAAP Adj
Slide 15: Adjusted Operating Income and Adjusted EBITDA Reconciliation by Quarter
Adjusted Operating Income and Adjusted EBITDA Q3 2018 Q2 2018 Q1 2018 Q4 2017 Q3 2017 Operating income, as reported $ 132.2 $ 164.7 $ 103.7 $ 90.3 $ 125.4 Amortization of purchased intangible assets 65.8 66.4 67.2 68.1 68.3 Reconciliation Restructuring costs, net 7.1 7.2 5.5 19.3 5.4 Equity-based co
Slide 16: Quarterly Adjusted Operating Income Reconciliation by Segment
Quarterly Third Quarter 2018 Non-GAAP Adjusted Operating Income Reconciliation by Segment Adjusted Connectivity Mobility S olutions S olutions Total Operating income, as reported $ 94.9 $ 37.3 $ 132.2 Operating Amortization of purchased intangible assets 44.4 21.4 65.8 Restructuring costs, net (0.4)
Slide 17: Adjusted Net Income Reconciliation
Adjusted Net Three Months Ended Nine Months Ended Income S eptember 30, S eptember 30, 2018 2017 2018 2017 Operating income, as reported $ 132.2 $ 125.4 $ 400.6 $ 381.8 Reconciliation Adjustments: Amortization of purchased intangible assets 65.8 68.3 199.5 202.9 Restructuring costs, net 7.1 5.4 19.7
Slide 18: Outlook GAAP to Non-GAAP Reconciliation
Outlook GAAP to Non-GAAP Outlook Three Months Ended Reconciliation December 31, Full Year 2018 2018 Operating income $ 60 - $83 $ 461 - $484 Adjustments: (Unaudited -- In millions) Amortization of purchased intangible assets $ 66 $ 265 Equity-based compensation $ 12 $ 46 Restructuring costs, integra