|
CERAGON NETWORKS LTD.
|
Date: February 8, 2023
|
By: /s/ Doron Arazi
|
|
Name: Doron Arazi
Title: Chief Executive Officer |
Exhibit
|
Description
|
• |
Revenues of $75.5 million
|
• |
Operating income of $1.7 million on a GAAP basis, or $3.2 million on a non-GAAP basis
|
• |
EPS of $(0.03) per diluted share on a GAAP basis, or $(0.00) per diluted share on a non-GAAP basis
|
• |
Revenues of $295.2 million
|
• |
Operating income of $1.4 million on a GAAP basis, or $9.3 million on a non-GAAP basis
|
• |
EPS of $(0.09) per diluted share on a GAAP basis, or $(0.01) per diluted share on a non-GAAP basis
|
• |
Strong yearly bookings in North America and India; 2022 annual book-to-bill well above 1
|
• |
Increased success in open networks solutions, Managed Services, and new use cases in Q4 and throughout the year
|
• |
North America:
|
o |
Excellent year in terms of bookings; Q4 softer due to seasonality
|
o |
Increased focus and significant traction in the critical infrastructure sector in Q4
|
• |
Europe:
|
o |
Strong quarter with several key agreements signed
|
o |
Open network solution gaining traction
|
• |
India:
|
o |
Strongest region in terms of Q4 and annual revenue
|
o |
Ongoing strong demand for our 4G network products and growing demand for our 5G network solutions
|
Q4 2022
|
Full Year 2022
|
|
India
|
29%
|
27%
|
North America
|
23%
|
23%
|
Latin America
|
17%
|
18%
|
Europe
|
13%
|
14%
|
APAC
|
11%
|
11%
|
Africa
|
7%
|
7%
|
Three months ended
December 31,
|
Year ended
December 31,
|
|||||||||||||||
2022
|
2021
|
2022
|
2021
|
|||||||||||||
Revenues
|
$
|
75,531
|
$
|
77,760
|
$
|
295,173
|
$
|
290,766
|
||||||||
Cost of revenues
|
50,999
|
54,929
|
202,110
|
202,389
|
||||||||||||
Gross profit
|
24,532
|
22,831
|
93,063
|
88,377
|
||||||||||||
Operating expenses:
|
||||||||||||||||
Research and development, net
|
8,080
|
7,795
|
29,690
|
29,473
|
||||||||||||
Seles and Marketing
|
8,998
|
9,026
|
35,795
|
33,509
|
||||||||||||
General and administrative
|
5,536
|
4,983
|
22,005
|
20,589
|
||||||||||||
Other operating expenses (*)
|
249
|
-
|
4,220
|
-
|
||||||||||||
Total operating expenses
|
$
|
22,863
|
$
|
21,804
|
$
|
91,710
|
$
|
83,571
|
||||||||
Operating income
|
1,669
|
1,027
|
1,353
|
4,806
|
||||||||||||
Financial expenses and others, net
|
3,012
|
3,397
|
6,306
|
8,625
|
||||||||||||
Loss before taxes
|
(1,343
|
)
|
(2,370
|
)
|
(4,953
|
)
|
(3,819
|
)
|
||||||||
Taxes on income
|
1,385
|
9,842
|
2,446
|
11,009
|
||||||||||||
Net loss
|
$
|
(2,728
|
)
|
$
|
(12,212
|
)
|
$
|
(7,399
|
)
|
$
|
(14,828
|
)
|
||||
Basic and diluted net loss per share
|
$
|
(0.03
|
)
|
$
|
(0.15
|
)
|
$
|
(0.09
|
)
|
$
|
(0.18
|
)
|
||||
Weighted average number of shares used in computing basic and diluted net loss per share
|
84,347,548
|
83,916,419
|
84,132,982
|
83,414,831
|
December 31,
2022
|
December 31,
2021
|
|||||||
|
Unaudited
|
Audited
|
||||||
ASSETS
|
||||||||
CURRENT ASSETS:
|
||||||||
Cash and cash equivalents
|
$
|
22,948
|
$
|
17,079
|
||||
Trade receivables, net
|
112,324
|
107,826
|
||||||
Other accounts receivable and prepaid expenses
|
15,756
|
17,179
|
||||||
Inventories
|
72,009
|
61,398
|
||||||
Total current assets
|
223,037
|
203,482
|
||||||
NON-CURRENT ASSETS:
|
||||||||
Trade receivables, net
|
-
|
10,484
|
||||||
Severance pay and pension fund
|
4,633
|
5,648
|
||||||
Property and equipment, net
|
29,456
|
29,383
|
||||||
Operating lease right-of-use assets
|
17,962
|
20,233
|
||||||
Intangible assets, net
|
8,208
|
6,274
|
||||||
Other non-current assets
|
18,312
|
17,059
|
||||||
Total non-current assets
|
78,571
|
89,081
|
||||||
Total assets
|
$
|
301,608
|
$
|
292,563
|
||||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
||||||||
CURRENT LIABILITIES:
|
||||||||
Trade payables
|
$
|
67,384
|
$
|
69,436
|
||||
Deferred revenues
|
3,343
|
3,384
|
||||||
Short-term loans
|
37,500
|
14,800
|
||||||
Operating lease liabilities
|
3,745
|
4,359
|
||||||
Other accounts payable and accrued expenses
|
20,864
|
23,704
|
||||||
Total current liabilities
|
132,836
|
115,683
|
||||||
LONG-TERM LIABILITIES:
|
||||||||
Accrued severance pay and pensions
|
9,314
|
10,799
|
||||||
Deferred revenues
|
11,545
|
9,275
|
||||||
Other long-term payables
|
2,653
|
2,445
|
||||||
Operating lease liabilities
|
13,187
|
17,210
|
||||||
Total long-term liabilities
|
36,699
|
39,729
|
||||||
SHAREHOLDERS' EQUITY:
|
||||||||
Share capital:
|
||||||||
Ordinary shares
|
224
|
224
|
||||||
Additional paid-in capital
|
432,214
|
428,244
|
||||||
Treasury shares at cost
|
(20,091
|
)
|
(20,091
|
)
|
||||
Other comprehensive loss
|
(11,156
|
)
|
(9,507
|
)
|
||||
Accumulated deficits
|
(269,118
|
)
|
(261,719
|
)
|
||||
Total shareholders' equity
|
132,073
|
137,151
|
||||||
Total liabilities and shareholders' equity
|
$
|
301,608
|
$
|
292,563
|
Three months ended
December 31,
|
Year ended
December 31,
|
|||||||||||||||
2022
|
2021
|
2022
|
2021
|
|||||||||||||
Cash flow from operating activities:
|
||||||||||||||||
Net loss
|
$
|
(2,728
|
)
|
$
|
(12,212
|
)
|
$
|
(7,399
|
)
|
$
|
(14,828
|
)
|
||||
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||||||||||||||
Depreciation and amortization
|
2,622
|
3,458
|
11,040
|
12,246
|
||||||||||||
Loss from sale of property and equipment, net
|
-
|
9
|
20
|
82
|
||||||||||||
Share-based compensation expense
|
958
|
891
|
3,560
|
2,562
|
||||||||||||
Increase (decrease) in accrued severance pay and pensions, net
|
245
|
(134
|
)
|
(445
|
)
|
(418
|
)
|
|||||||||
Decrease (increase) in trade receivables, net
|
3,652
|
(8,562
|
)
|
6,138
|
(11,150
|
)
|
||||||||||
Decrease (increase) in other accounts receivable and prepaid expenses (including other long term assets)
|
1,414
|
744
|
(345
|
)
|
(6,976
|
)
|
||||||||||
Decrease in operating lease right-of-use assets
|
845
|
2,320
|
3,571
|
5,713
|
||||||||||||
Increase in inventory, net of write off
|
(7,845
|
)
|
(8,473
|
)
|
(11,155
|
)
|
(11,908
|
)
|
||||||||
Decrease in deferred tax asset, net
|
-
|
8,543
|
-
|
8,279
|
||||||||||||
Increase (decrease) in trade payables
|
(5,191
|
)
|
6,148
|
(2,018
|
)
|
5,883
|
||||||||||
Decrease in other accounts payable and accrued expenses (including other long term liabilities)
|
(2,190
|
)
|
(1,370
|
)
|
(4,154
|
)
|
(1,556
|
)
|
||||||||
Decrease in operating lease liability
|
(779
|
)
|
(1,578
|
)
|
(5,937
|
)
|
(4,620
|
)
|
||||||||
Increase in deferred revenues
|
494
|
476
|
2,229
|
1,672
|
||||||||||||
Net cash used in operating activities
|
$
|
(8,503
|
)
|
$
|
(9,740
|
)
|
$
|
(4,895
|
)
|
$
|
(15,019
|
)
|
||||
Cash flow from investing activities:
|
||||||||||||||||
Purchase of property and equipment
|
(1,432
|
)
|
(3,136
|
)
|
(10,464
|
)
|
(9,383
|
)
|
||||||||
Proceeds from sale of property and equipment
|
-
|
-
|
-
|
200
|
||||||||||||
Purchase of intangible assets
|
(697
|
)
|
(192
|
)
|
(1,957
|
)
|
(212
|
)
|
||||||||
Net cash used in investing activities
|
$
|
(2,129
|
)
|
$
|
(3,328
|
)
|
$
|
(12,421
|
)
|
$
|
(9,395
|
)
|
||||
Cash flow from financing activities:
|
||||||||||||||||
Proceeds from exercise of options
|
-
|
42
|
410
|
4,730
|
||||||||||||
Proceeds from bank credits and loans, net
|
7,600
|
2,900
|
22,700
|
9,800
|
||||||||||||
Net cash provided by financing activities
|
$
|
7,600
|
$
|
2,942
|
$
|
23,110
|
$
|
14,530
|
||||||||
Translation adjustments on cash and cash equivalents
|
$
|
16
|
$
|
(30
|
)
|
$
|
75
|
$
|
(138
|
)
|
||||||
Increase (decrease) in cash and cash equivalents
|
$
|
(3,016
|
)
|
$
|
(10,156
|
)
|
$
|
5,869
|
$
|
(10,022
|
)
|
|||||
Cash and cash equivalents at the beginning of the period
|
25,964
|
27,235
|
17,079
|
27,101
|
||||||||||||
Cash and cash equivalents at the end of the period
|
$
|
22,948
|
$
|
17,079
|
$
|
22,948
|
$
|
17,079
|
Three months ended
|
Year ended
|
|||||||||||||||
December 31,
|
December 31,
|
|||||||||||||||
2022
|
2021
|
2022
|
2021
|
|||||||||||||
GAAP cost of revenues
|
$
|
50,999
|
$
|
54,929
|
$
|
202,110
|
$
|
202,389
|
||||||||
Stock based compensation expenses
|
(169
|
)
|
(129
|
)
|
(587
|
)
|
(289
|
)
|
||||||||
Paycheck protection program
|
-
|
-
|
-
|
306
|
||||||||||||
Changes in indirect tax positions
|
(279
|
)
|
399
|
(281
|
)
|
394
|
||||||||||
Non-GAAP cost of revenues
|
$
|
50,551
|
$
|
55,199
|
$
|
201,242
|
$
|
202,800
|
||||||||
GAAP gross profit
|
$
|
24,532
|
$
|
22,831
|
$
|
93,063
|
$
|
88,377
|
||||||||
Gross profit adjustments
|
448
|
(270
|
)
|
868
|
(411
|
)
|
||||||||||
Non-GAAP gross profit
|
$
|
24,980
|
$
|
22,561
|
$
|
93,931
|
$
|
87,966
|
||||||||
GAAP Research and development expenses
|
$
|
8,080
|
$
|
7,795
|
$
|
29,690
|
$
|
29,473
|
||||||||
Stock based compensation expenses
|
(217
|
)
|
(50
|
)
|
(405
|
)
|
(236
|
)
|
||||||||
Non-GAAP Research and development expenses
|
$
|
7,863
|
$
|
7,745
|
$
|
29,285
|
$
|
29,237
|
||||||||
GAAP Sales and Marketing expenses
|
$
|
8,998
|
$
|
9,026
|
$
|
35,795
|
$
|
33,509
|
||||||||
Stock based compensation expenses
|
(393
|
)
|
(345
|
)
|
(1,355
|
)
|
(700
|
)
|
||||||||
Paycheck protection program
|
-
|
-
|
-
|
673
|
||||||||||||
Non-GAAP Sales and Marketing expenses
|
$
|
8,605
|
$
|
8,681
|
$
|
34,440
|
$
|
33,482
|
||||||||
GAAP General and Administrative expenses
|
$
|
5,536
|
$
|
4,983
|
$
|
22,005
|
$
|
20,589
|
||||||||
Retired CEO compensation
|
-
|
-
|
96
|
(810
|
)
|
|||||||||||
Stock based compensation expenses
|
(179
|
)
|
(367
|
)
|
(1,213
|
)
|
(1,337
|
)
|
||||||||
Non-GAAP General and Administrative expenses
|
$
|
5,357
|
$
|
4,616
|
$
|
20,888
|
$
|
18,442
|
||||||||
GAAP Other operating expenses
|
$
|
249
|
$
|
-
|
$
|
4,220
|
$
|
-
|
||||||||
Hostile attempt related costs
|
(249
|
)
|
-
|
(4,220
|
)
|
-
|
||||||||||
Non-GAAP Other operating expenses
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||
GAAP operating income
|
$
|
1,669
|
$
|
1,027
|
$
|
1,353
|
$
|
4,806
|
||||||||
Stock based compensation expenses
|
958
|
891
|
3,560
|
2,562
|
||||||||||||
Changes in indirect tax positions
|
279
|
(399
|
)
|
281
|
(394
|
)
|
||||||||||
Retired CEO compensation
|
-
|
-
|
(96
|
)
|
810
|
|||||||||||
Paycheck protection program
|
-
|
-
|
-
|
(979
|
)
|
|||||||||||
Hostile attempt related costs
|
249
|
-
|
4,220
|
-
|
||||||||||||
Non-GAAP operating income
|
$
|
3,155
|
$
|
1,519
|
$
|
9,318
|
$
|
6,805
|
||||||||
GAAP financial expenses and others, net
|
$
|
3,012
|
$
|
3,397
|
$
|
6,306
|
$
|
8,625
|
||||||||
Leases – financial income (expenses)
|
(154
|
)
|
(706
|
)
|
2,278
|
(1,057
|
)
|
|||||||||
Non-GAAP financial expenses and others, net
|
$
|
2,858
|
$
|
2,691
|
$
|
8,584
|
$
|
7,568
|
||||||||
GAAP Tax expenses
|
$
|
1,385
|
$
|
9,842
|
$
|
2,446
|
$
|
11,009
|
||||||||
Non cash tax adjustments
|
(851
|
)
|
(8,987
|
)
|
(1,278
|
)
|
(9,039
|
)
|
||||||||
Non-GAAP Tax expenses
|
$
|
534
|
$
|
855
|
$
|
1,168
|
$
|
1,970
|
Three months ended
December 31,
|
Year ended
December 31,
|
|||||||||||||||
2022
|
2021
|
2022
|
2021
|
|||||||||||||
GAAP net loss
|
$
|
(2,728
|
)
|
$
|
(12,212
|
)
|
$
|
(7,399
|
)
|
$
|
(14,828
|
)
|
||||
Stock based compensation expenses
|
958
|
891
|
3,560
|
2,562
|
||||||||||||
Changes in indirect tax positions
|
279
|
(399
|
)
|
281
|
(394
|
)
|
||||||||||
Leases – financial expenses (income)
|
154
|
706
|
(2,278
|
)
|
1,057
|
|||||||||||
Paycheck protection program
|
-
|
-
|
(96
|
)
|
(979
|
)
|
||||||||||
Retired CEO compensation
|
-
|
-
|
-
|
810
|
||||||||||||
Hostile attempt related Costs
|
249
|
-
|
4,220
|
-
|
||||||||||||
Non-cash tax adjustments
|
851
|
8,987
|
1,278
|
9,039
|
||||||||||||
Non-GAAP net loss
|
$
|
(237
|
)
|
$
|
(2,027
|
)
|
$
|
(434
|
)
|
$
|
(2,733
|
)
|
||||
GAAP basic and diluted net loss per share
|
$
|
(0.03
|
)
|
$
|
(0.15
|
)
|
$
|
(0.09
|
)
|
$
|
(0.18
|
)
|
||||
Non-GAAP diluted net loss per share
|
$
|
(0.00
|
)
|
$
|
(0.02
|
)
|
$
|
(0.01
|
)
|
$
|
(0.03
|
)
|
||||
Weighted average number of shares used in computing GAAP basic and diluted net loss per share
|
84,347,548
|
83,916,419
|
84,132,982
|
83,414,831
|
||||||||||||
Weighted average number of shares used in computing Non-GAAP diluted net loss per share
|
84,347,548
|
83,916,419
|
84,132,982
|
83,414,831
|