SRTI BLOCKCHAIN GENERATION INC 
By
Net sales for the second quarter of 2008 were
Gross margin of 62% for the second quarter 2008, is up from 59% in the first quarter of 2008 and up from 60% in the second quarter a year ago. The sequential improvement in gross margin was primarily due to a decline in inventory write-offs.
The second quarter operating loss was
"Second quarter revenues came in at the high end of the expected range
despite the challenging economic environment," said Sunrise Telecom President
and CEO,
Restructuring Update
The company made substantial progress during the second quarter towards its cost cutting and productivity improvement program announced in February. The integration of the wireline, fiber optics and broadband product groups into a single business is nearing completion and the management team has been realigned to reflect this new structure.
As part of the company's cost cutting initiatives, total headcount has
been reduced by 13% since year-end 2007. The consolidation of manufacturing
facilities is expected to be completed in the third quarter, including the
shutdown of the
Additional Highlights
-- Expanded the addressable market for Sunrise Telecom's VDSL2 Home Test
Toolkit(TM). The HTT, which had previously been available only in
-- Released RealWORX(TM) Web, the industry's most comprehensive monitoring system for RF CATV and broadband communications services.
-- Released the SunLite GigE, a palm size Gigabit Ethernet tester ideally suited for the installation and maintenance of Ethernet business services.
-- Sunrise Telecom's TAMS 7-VoIP named product finalist for the best new management product for 2007 at the TM Forum Excellence Awards.
Third Quarter Business Outlook
Based on current backlog and order expectations, Sunrise Telecom forecasts
its third quarter sales to be in the range of
Conference Call and Webcast
President and Chief Executive Officer,
-Financial Tables Following-
Financial Results Summary
(In thousands, except per share and percentage data, unaudited)
For the Three
Months Ended
June 30,
2008
Selected Income Statement Data (preliminary)
Net sales $19,777
Loss from operations $(3,791)
Net income $(3,683)
Diluted earnings per share $(0.07)
Shares outstanding (diluted) 51,349
Gross profit percentage 62%
Backlog at end of quarter $11,064
Selected Consolidated Balance Sheet Data (preliminary)
June 30,
2008
Cash and cash equivalents $11,621
Accounts receivable, net of allowance of $519 16,242
Inventories 17,195
Short-term borrowings and current portion of
notes payable 2,183
Accounts payable 3,262
Other accrued expenses 13,942
Deferred revenue 3,564
Notes payable, less current portion 374
These results are preliminary and subject to change as this financial information been subjected to completed audit or review procedures, by our independent auditor.
SUNRISE TELECOM INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (preliminary)
(In thousands, except per share data, unaudited)
Three Months Ended
June 30,
2008
Net sales $19,777
Cost of sales 7,493
Gross profit 12,284
Operating expenses:
Research and development 5,003
Selling and marketing 6,317
General and administrative 4,521
Restructuring 234
Total operating expenses 16,075
Loss from operations (3,791)
Other income, net 414
Loss before income taxes (3,377)
Income tax expense 306
Net loss $(3,683)
Earnings per share:
Basic and diluted $(0.07)
Shares used in per share computation:
Basic and diluted 51,349
SUNRISE TELECOM INCORPORATED
NET SALES DETAILS (preliminary)
(In thousands, unaudited)
Three Months Ended
Jun. 30, Mar. 31, Jun. 30,
2008 2008 2007
By Product:
Wireline access $6,653 34% $8,157 41% $7,472 32%
Cable broadband 4,903 25% 5,279 26% 10,145 44%
Fiber optics 5,920 29% 5,323 26% 5,035 22%
Protocol 2,301 12% 1,211 7% 395 2%
$19,777 $19,970 $23,047
Three Months Ended
Jun. 30, Mar. 31, Jun. 30,
2008 2008 2007
By Region:
North America (United
States and Canada) $7,888 38% $7,528 40% $13,330 58%
Asia Pacific 4,610 24% 4,738 17% 4,717 20%
Europe/Africa/Middle East 6,563 34% 6,832 38% 4,342 19%
Latin America 716 4% 872 5% 658 3%
$19,777 $19,970 $23,047
SUMMARY OF CERTAIN NONCASH EXPENSES (preliminary)
(In thousands, unaudited)
The following expenses are included in the applicable lines of Sunrise
Telecom Incorporated's Condensed Consolidated Statements of Operations, as
required by GAAP.
Three Months Ended
June 30,
2008
Share based compensation:
Included in cost of sales $2
Included in research and development 13
Included in selling and marketing 18
Included in general and administrative 12
$45
Amortization of acquisition-related intangible
assets included in general and administrative $40
About Sunrise Telecom Incorporated
Sunrise Telecom develops and delivers high-quality communications test and
measurement solutions for today's telecom, cable and wireless networks. The
Company's robust portfolio of feature-rich, easy-to-use products enables
service providers to deliver premium voice, video, data and next-generation
digital multimedia services quickly, reliably, and cost-effectively. Based in
SUNRISE TELECOM, the "S" logo, and other trademarks are trademarks of Sunrise Telecom Incorporated and may not be used without permission.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning
of Section 21E of the Securities Exchange Act of 1934 and Section 27A of the
Securities Act of 1933, including, but not limited to, material contained in
quotations, sales expectations for the third quarter of 2008, expectations
related to the implementation of a cost reduction program and ability to
reduce operating expenses. These forward-looking statements are subject to
many risks and uncertainties that could cause actual results to differ
materially from those projected. Specific factors that may cause results to
differ include the following: a lack of acceptance or slower than anticipated
acceptance for Sunrise Telecom's new or enhanced products and modules; slower
than anticipated product development or introduction into the marketplace;
unanticipated delays in product delivery schedules; lower than anticipated
end-user demand for telecommunications services and a corresponding cutback in
spending by customers; increased competitive pressures, including from former
employees; rapid technological change within the telecommunications industry;
Sunrise Telecom's dependence on a limited number of major customers; Sunrise
Telecom's dependence on limited source suppliers; deferred or lost sales
resulting from order cancellations or order changes; deferred or lost sales
resulting from Sunrise Telecom's lengthy sales cycle; unanticipated
difficulties associated with international operations; Sunrise Telecom's
ability to manage growth and slowdowns; disproportionately high compliance
costs relative to Sunrise Telecom's size; time spent by management reviewing
alternative capital structure proposals and strategic, balance-sheet asset
proposals to make the Company more successful; the loss of key employees;
ineffective internal controls requiring remediation; the long-term impact of
cost controls; the unknown effects of management changes; the ramifications of
Sunrise Telecom's inability to file required reports with the SEC on a timely
basis; any potential claims or proceedings related to such matters, including
stockholder litigation and any action by the SEC; and protracted litigation,
which could disrupt Sunrise Telecom's normal business operations. Some of
these risks and uncertainties are described in more detail in Sunrise
Telecom's reports filed with the SEC, including, but not limited to, its
Annual Report on Form 10-K for the period ended
SOURCE Sunrise Telecom Incorporated
