UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
OF THE SECURITIES EXCHANGE ACT OF 1934
For the month of May 2005
Commission File Number: 0-30628
ALVARION LTD.
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(Translation of registrant's name into English)
21A Habarzel Street, Tel Aviv 69710, Israel
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(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.
Form 20-F |X| Form 40-F |_|
Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(1): ____
Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(7): ____
Indicate by check mark whether by furnishing the information contained in this
Form, the registrant is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes |_| No |X|
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): 82-___________
The following are included in this report on Form 6-K:
Sequential
Exhibit Description Page Number
------- ----------- -----------
1. Press release on Q1 2005 Quarterly
Reports, dated May 4, 2005 4
2
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ALVARION LTD.
Date: May 9, 2005 By: /s/ Dafna Gruber
-----------------------------
Name: Dafna Gruber
Title: Chief Financial Officer
3
EXHIBIT 1
Contacts
Dafna Gruber, CFO Carmen Deville
+972 3 645 6252 +760-517-3188
+760-517-3187
dafna.gruber@alvarion.com carmen.deville@alvarion.com
------------------------- ---------------------------
FOR IMMEDIATE RELEASE
ALVARION REPORTS FIRST QUARTER 2005 RESULTS
o Broad-based growth continues
o BreezeMAX(TM) continues to dominate WiMAX trials and commercial deployments
TEL AVIV, Israel--May 4, 2005 -- Alvarion Ltd. (NASDAQ: ALVR), the leading
provider of wireless broadband solutions worldwide, today announced financial
results for the first quarter ended March 31, 2005.
On a GAAP basis, revenue for the first quarter reached a record of $57.2
million, up 2% sequentially from $55.9 million and up 28% from $44.7 million in
the first quarter of 2004. Net income was $0.4 million, or $0.01 per share for
the quarter, compared with a net loss of $6.8 million or $0.12 cents loss per
share in the fourth quarter of 2004 and net income of $1.4 million, or $0.02 per
share in the first quarter of 2004. First quarter results included $0.9 million
acquisition-related expenses pertaining to the purchase of interWAVE
Communications on December 9, 2004, as well as $1.1 million of amortization of
intangibles and $0.5 million amortization of deferred stock compensation.
Management indicated that any additional acquisition-related charge in Q2 will
be minimal.
Excluding amortizations and acquisition-related charges, on a non-GAAP basis,
net income was $2.8 million, or $0.04 per share compared with $5.4 million, or
$0.08 per share in the prior quarter and $2.1 million, or $0.03 per share in Q1
of 2004.
Gross margin increased to 46% as a result of favorable product mix. Excluding
amortizations and acquisition-related expenses mentioned above, operating
expenses increased to $24.2 million or 42% of revenue, on a non- GAAP basis, due
primarily to the inclusion of interWAVE Communications' operating expenses for a
full quarter.
4
Comments of Management
"Our team executed very well this quarter on all major objectives - financial,
technical, and market development," said Zvi Slonimsky, CEO of Alvarion. "We are
meeting our targets and continue to expect revenue growth of at least 25% this
year.
"Demand is strong for both WiMAX and non-WiMAX solutions, and growth in Q1 was
broad-based, coming from products for both licensed and license-exempt
frequencies. Europe was a particular source of strength again this quarter as a
result of increasing demand from independent operators using the 5.4 GHz
licensed-exempt band that recently became available throughout Europe. These
operators are moving aggressively to fill the holes in DSL coverage and, in
turn, are prompting the Tier 1 operators to begin moving as well.
"The integration of interWAVE's business is progressing according to plan, and
we are beginning to expand our pipeline of new opportunities. Based on this we
continue to believe that, once we move through the normal sales cycles for this
business, we will begin to see more traction during the second half of the
year.
"We recently celebrated another important milestone in the widespread adoption
of the WiMAX standard when Intel officially launched their Intel PRO/Wireless
5116 chip. Alvarion is the first company to offer a live demonstration of a
working CPE, based on the Intel chip, connected to a live operator's network.
This important event took place during the last WiMAX summit in Malaga and is an
indication of our time-to-market advantage.
"It was certainly gratifying that most of the operators that participated in the
Intel launch event, including Altitude, Iberbanda, and Millicom, are Alvarion
customers. Evaluation and trial deployment activity remains brisk, with Alvarion
involved in most of the active trials around the world. The scope and duration
of these trials up to this point reinforces our belief that our growth will
accelerate in the second half of the year.
"We believe that we stand on the threshold of the WiMAX revolution in fixed
broadband access, and we look forward to continuing to lead the market for
mobile WiMAX through our collaboration with several major partners. We see a
bright future for both fixed and mobile applications of this technology,"
concluded Mr. Slonimsky.
Guidance
--------
The Company's revenue guidance for Q2 2005 is $53 million to $58 million. This
guidance assumes no substantial contribution from additional orders related to a
major customer's ongoing project due to the difficulty in predicting the precise
timing of orders.
At the revenue range above, net earnings per share are expected to range between
breakeven and 3 cents while non-GAAP net earnings per share, which excludes
amortization of intangibles and acquisition-related charges, is expected to
range between 2 and 5 cents.
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Alvarion's management will host a conference call today, May 4, at 9:00 a.m.
Eastern Time to discuss the quarter. To participate in the call, please dial one
of the following numbers approximately five minutes prior to the scheduled start
time: USA: 612-332-1025; International: +1-612-332-1025.
The public is invited to listen to the live webcast of the conference call. For
details please visit Alvarion's website at www.alvarion.com. An archive of the
on-line broadcast will be available on the website. A replay of the call will be
available from 2:30 p.m. EDT on May 4 through 11:59 p.m. EDT on May 11, 2005. To
access the replay, please call USA: 320-365-3844, International:
+1-320-365-3844. To access the replay, users will need to enter the following
code: 777770.
About Alvarion
With more than 2 million units deployed in 130 countries, Alvarion is the
worldwide leader in wireless broadband providing systems to carriers, ISPs and
private network operators. Leading the WiMAX revolution, Alvarion has the most
extensive deployments and proven product portfolio in the industry covering the
full range of frequency bands. Alvarion's products enable the delivery of
business and residential broadband access, corporate VPNs, toll quality
telephony, mobile base station feeding, Hotspot coverage extension, community
interconnection, and public safety communications. Alvarion works with several
top OEM providers and over 200 local partners to support its diverse global
customer base in solving their last-mile challenges. As a wireless broadband
pioneer, Alvarion has been driving and delivering innovations for over 10 years
from core technology developments to creating and promoting industry standards.
Leveraging its key roles in the IEEE and HiperMAN standards committees and
experience deploying OFDM-based systems, the company's prominent work in the
WiMAX ForumTM is focused on increasing widespread adoption of standards-based
products in the wireless broadband market.
For more information, visit Alvarion's World Wide Web site at www.alvarion.com
This press release contains forward -looking statements within the meaning of
the "safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These statements are based on the current expectations or beliefs of
Alvarion's management and are subject to a number of factors and uncertainties
that could cause actual results to differ materially from those described in the
forward -looking statements. The following factors, among others, could cause
actual results to differ materially from those described in the forward-looking
statements: inability to further identify, develop and achieve success for new
products, services and technologies; increased competition and its effect on
pricing, spending, third-party relationships and revenues; as well as the in
ability to establish and maintain relationships with commerce, advertising,
marketing, and technology providers and other risks detailed from time to time
in filings with the Securities and Exchange Commission.
Information set forth in this press release pertaining to third parties has not
been independently verified by Alvarion and is based solely on publicly
available information or on information provided to Alvarion by such third
parties for inclusion in this press release. The web sites appearing in this
press release are not and will not be included or incorporated by reference in
any filing made by Alvarion with the Securities and Exchange Commission, which
this press release will be a part of.
You may request Alvarion's future press releases or a complete Investor Kit by
contacting Carmen Deville, Investor Relations: carmen.deville@alvarion.com or +1
650 314 2653.
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ALVARION LTD.& ITS SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands
March 31, December 31,
2005 2004
-------- -----------
ASSETS
Cash, cash equivalents, short-term and long-term
investments $127,162 $132,682
Trade receivables 31,533 28,148
Other accounts receivable 5,553 6,492
Inventories 37,892 41,328
Severance pay fund 7,191 7,025
Long-term receivables 468 456
PROPERTY AND EQUIPMENT, NET 12,150 11,925
GOODWILL AND OTHER INTANGIBLE ASSETS 99,385 100,479
-------- --------
TOTAL ASSETS $321,334 $328,535
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Trade payables $ 29,214 $ 26,481
Other accounts payable and accrued expenses 45,683 55,611
-------- --------
Total current liabilities 74,897 82,092
LONG TERM LIABILITIES 1,728 3,505
ACCRUED SEVERANCE PAY 10,418 10,126
-------- --------
TOTAL LIABILITIES 87,043 95,723
SHAREHOLDERS' EQUITY 234,291 232,812
-------- --------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $321,334 $328,535
======== ========
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ALVARION LTD.& ITS SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except per share data)
Three Three Three
Months Months Months Year
Ended Ended Ended Ended
March 31, March 31, December 31, December 31,
--------- --------- ----------- -----------
2005 2004 2004 2004
--------- --------- ----------- -----------
Sales $ 57,233 $ 44,679 $ 55,878 $ 201,507
Cost of sales 30,739 25,654 31,328 113,741
--------- --------- --------- ---------
Gross profit 26,494 19,025 24,550 87,766
--------- --------- --------- ---------
Operating expenses:
Research and development, net 9,356 6,614 7,598 27,816
Selling and marketing 11,989 8,987 10,002 39,038
General and administrative 2,850 2,240 2,663 9,682
Amortization of acquired current
technology, customer relationships
and trademarks 1,094 669 772 2,779
Amortization of deferred stock compensation 530 11 27 60
Acquisition related expenses 868 -- 369 369
In Process Research & Development write-off -- -- 10,993 10,993
--------- --------- --------- ---------
Total Operating expenses 26,687 18,521 32,424 90,737
--------- --------- --------- ---------
Operating income (loss) (193) 504 (7,874) (2,971)
Financial income, net 549 932 1,119 3,821
--------- --------- --------- ---------
Net Income (loss ) $ 356 $ 1,436 $ (6,755) $ 851
--------- --------- --------- ---------
Basic earnings (loss) per share $ 0.01 $ 0.03 $ (0.12) $ 0.02 $
========= ========= ========= =========
Weighted average number of shares
used in computing basic earnings
(loss) per share 58,083 55,190 57,619 56,549
========= ========= ========= =========
Diluted earnings (loss) per share $ 0.01 $ 0.02 $ (0.12) $ 0.01
========= ========= ========= =========
Weighted average number of shares
used in computing diluted earnings
(loss) per share 63,708 62,804 57,619 63,754
========= ========= ========= =========
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ALVARION LTD.& ITS SUBSIDIARIES
DISCLOSURE OF NON-US GAAP NET INCOME
FOR COMPARATIVE PURPOSES NET INCOME AND EARNINGS PER SHARE EXCLUDING
AMORTIZATION OF ACQUIRED INTANGIBLES, DEFERRED STOCK COMPENSATION,
ACQUIRED IN-PROCESS RESEARCH AND DEVELOPMENT WRITE-OFF AND OTHER
ACQUISITION RELATED EXPENSES
U.S. dollars in thousands (except per share data)
Three Three Three
Months Months Months Year
Ended Ended Ended Ended
March 31, March 31, December 31, December 31,
--------- --------- ----------- -----------
2005 2004 2004 2004
--------- --------- ----------- -----------
Net Income (loss) according to US GAAP $ 356 $ 1,436 $ (6,755) $ 851
Amortization of acquired current
technology, customer relationships
and trademarks 1,094 669 772 2,779
Amortization of deferred stock compensation 530 11 27 60
Acquisition related expenses 868 -- 369 369
Acquired In-Process Research &
Development write-off -- -- 10,993 10,993
-------- -------- -------- --------
Net Income excluding amortization of
intangibles and deferred stock
compensation, acquisition related
expenses and In-process Research
and Development write-off $ 2,848 $ 2,116 $ 5,407 $ 15,052
======== ======== ======== ========
Basic net earnings per share,
excluding amortization of
intangibles and deferred stock
compensation, acquisition related
expenses and In-process Research
and Development write-off $ 0.05 $ 0.04 $ 0.09 $ 0.27
======== ======== ======== ========
Weighted average number of shares
used in computing basic net earnings
per share 58,083 55,190 57,619 56,549
======== ======== ======== ========
Diluted net earnings per share,
excluding amortization of
intangibles and deferred stock
compensation , acquisition related
expenses and In-process Research
and Development write-off $ 0.04 $ 0.03 $ 0.08 $ 0.24
======== ======== ======== ========
Weighted average number of shares
used in computing diluted net
earnings per share 63,708 62,804 64,447 63,754
======== ======== ======== ========
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ALVARION LTD.& ITS SUBSIDIARIES
CONDENSED CONSOLIDATED CASH FLOW
U.S. dollars in thousands
Three
Months ended
March 31, 2005
----------------
Cash flows from operating activities:
Net Income $ 356
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 1,053
Amortization of deferred stock compensation 530
Unrealized gain from derivative financial instruments (187)
Amortization of intangibles 1,094
Increase in trade receivables (3,385)
Decrease in other accounts receivable and prepaid expenses 939
Decrease in inventories 3,436
Increase in trade payables 2,733
Decrease in Long term receivables (12)
Decrease in other accounts payables and accrued expenses (6,374)
Accrued severance pay, net 126
---------
Net cash provided by operating activities 309
Cash flows from investing activities:
Purchase of fixed assets (1,278)
---------
Net cash used in investing activities (1,278)
Cash flows from financing activities:
Proceeds from exercise of employees' stock options,
net of expenses 780
Repayment of long term liability (1,777)
---------
Net cash used in financing activities (997)
Cash flows from non-recurring activities:
Cash used to IWAV trade payables related to the merger (3,554)
---------
Net cash used in non-recurring activities (3,554)
---------
Decrease in cash, cash equivalents, short-term and
long-term investments (5,520)
Cash, cash equivalents, short-term and long-term
investments at the beginning of the period 132,682
---------
Cash, cash equivalents, short-term and long-term
investments at the end of the period $ 127,162
=========
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