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8-K - FORM 8-K - TEKELEC | v58260e8vk.htm |
EX-3.1 - EX-3.1 - TEKELEC | v58260exv3w1.htm |
Exhibit 99.1
Frank Plastina, President & CEO, Steps Down
Krish Prabhu, Member of Board of Directors, Appointed Interim CEO
MORRISVILLE, N.C. January 5, 2011 Tekelec (NASDAQ: TKLC), the broadband data management
company, today announced that President and Chief Executive Officer Frank Plastina has stepped
down, with his resignation effective yesterday. He will serve in a consulting role to the company
through February 2011. Krish Prabhu, a member of the Board of Directors and a 25-year industry
veteran, has been appointed interim CEO. Tekelecs Board has formed a succession committee to
conduct a search for a permanent CEO.
In his five years at Tekelec, Frank led the successful transformation of the company into a global
leader and innovator in next generation network intelligence, highlighted by record revenues and
earnings during his tenure, said Mark Floyd, Chairman of the Board. Frank has positioned Tekelec
for the future, both in terms of product evolution and revenue growth, and we wish him great
success in his next endeavor.
Plastina commented, Im extremely proud of our accomplishments over the past five years. I remain
an investor in Tekelec, and I believe in and look forward to seeing the next stage of Tekelecs
success.
Prabhus extensive experience includes nearly three years on Tekelecs Board of Directors. He
served as CEO and President of Tellabs from February 2004 until his retirement in April 2008 and
prior to that, multiple senior executive roles at Alcatel, including COO. In his Board role,
Prabhu chairs Tekelecs Corporate Development Committee, which oversees the companys acquisition
strategy, including the recent acquisitions of Camiant and Blueslice.
We expect Krishs active role on the Board, involvement with the companys acquisitions, and
extensive industry experience will make this transition as seamless as possible, said Floyd.
With a solid financial foundation and next-gen portfolio in place, Tekelec remains committed to
our customers success through this transition, said Prabhu.
Updated 2010 Full Year Guidance
We believe orders for 2010 will be between $385 million and $395 million, with fourth quarter
orders in the range of $175 million to $185 million, the second-highest in Tekelecs history. With
regard to revenues, in our prepared remarks during the third quarter call we stated that our
guidance included an India number portability project valued at more than $10 million, and that
delays in the number portability implementation dates or associated customer acceptance testing
could cause the revenue associated with this project to move to 2011. We are still in the process
of completing customer acceptance associated with this project, resulting in the delay of revenue
recognition into 2011. Accordingly we expect our full year revenues for 2010 will range between
$415 million and $425 million and our non-GAAP gross margins will be in the mid sixty percent
range. Finally, we believe that our non-GAAP EPS range will be between $0.62 and $0.67 per diluted
share and we expect the range for GAAP EPS will be between $0.20 and $0.25 per diluted share.
5200 Paramount Parkway, Morrisville, N.C., USA 27580 TEL +1.919.460.5500 FAX +1.919.460.0877
2010 | 2010 | |||||||
Preliminary | Previous | |||||||
Results | Guidance | |||||||
Revenues |
$ | 415M - $425M | $ | 430M - $440M | ||||
Non-GAAP Gross Margin % |
mid 60s | mid 60s | ||||||
Non-GAAP Diluted EPS * |
$ | 0.62 - $0.67 | $ | 0.75 - $0.80 | ||||
GAAP Diluted EPS |
$ | 0.20 - $0.25 | $ | 0.30 - $0.35 |
* | Preliminary results and previous non-GAAP guidance each excludes an estimated $13M of stock-based compensation and $31M of amortization of intangible assets and acquisition-related expenses. Each of these, net of the associated tax impact, are included in GAAP EPS. The estimated net tax impact included in the preliminary results is $14M and the estimated net tax impact included in the previous guidance is $13M. |
Because financial statements for the fourth quarter and full year 2010 are not yet available,
these fourth quarter and full year estimates are preliminary, unaudited, subject to completion,
reflective of the Companys current best estimates and may be revised as a result of managements
further review. During the course of the preparation of consolidated annual financial statements
and related notes, the Company may identify items that would require material adjustments, such as
adjustments associated with certain tax items, to the preliminary financial information presented
above.
Non-GAAP Information
Certain non-GAAP financial measures are included in this press release. In the calculation of
these measures, Tekelec generally excludes certain items such as amortization of acquired
intangibles, restructuring and other charges, non-cash stock-based compensation charges, and
unusual, non-recurring gains and charges. Tekelec believes that excluding such items provides
investors and management with a representation of the Companys core operating performance and with
information useful in assessing its prospects for the future and underlying trends in Tekelecs
operating expenditures and continuing operations. Management uses such non-GAAP measures to (i)
evaluate financial results, (ii) manage the Companys operations, and (iii) establish operational
goals. Further, non-GAAP measures are utilized by the Companys management and board of directors
to assist in determining incentive compensation and evaluating key trends within the business. In
addition, since the Company has historically reported non-GAAP measures to the investment
community, the Company believes the inclusion of this information provides consistency in our
financial reporting. The release and the attachments to this release provide a reconciliation of
each of the non-GAAP measures referred to in this release to the most directly comparable GAAP
measure. The non-GAAP financial measures are not meant to be considered a substitute for the
corresponding GAAP financial measures.
Forward-Looking Statements
Certain statements made in this press release are forward-looking, reflect the Companys current
intent, belief or expectations and involve certain risks and uncertainties. The Companys actual
performance may differ materially from such expectations as a result of important risk factors,
which include, in addition to those identified in the Companys 2009 Form 10-K, 2010 First, Second,
and Third Quarter Forms 10-Q and its other filings with the Securities and Exchange Commission,
changes resulting from managements further review of financial results, customary financial close
processes and the year-end audit, potential adverse perceptions or consequences resulting from the
current executive transition process, the current or further detrimental changes in general
economic, social, or political conditions in the countries in which we operate including the impact
of credit availability and other economic factors on overall capital spending by our customers and
resulting pressure on us to lower our prices, the rate and size of decline in demand for our
SS7-based products, our ability to compete with other manufacturers that have lower cost bases than
ours, are partially supported by foreign governments, and/or employ unfair trade practices, risks
related to our international sales, markets and operations, including among others, import
5200 Paramount Parkway, Morrisville, N.C., USA 27580 TEL +1.919.460.5500 FAX +1.919.460.0877
regulations, limited intellectual property protection, including protection of our software source
code, increased costs and potential liabilities related to compliance with current and future
security provisions in customer contracts and regulations, and security restrictions and access
requirements imposed by governments, including in particular the government of India, exposure to
increased bad debt expense and product and service disputes as a result of general economic
conditions, the timeliness and functional competitiveness of our product releases, the timing and
size of any increase in demand for our performance management, SIP, Diameter, policy and subscriber
database products, the risk of infringing on, and litigating with others regarding their
intellectual property rights, the timing of our recognition of revenues, the extent to which any
customer outsourcing to our competitors or supplier consolidation increases the influence of
competitors on our customers purchases, our ability to protect intellectual property rights, our
ability to maintain OEM, partner, reseller, and vendor support and supply relationships, and
changes in the market price of the Companys common stock. The Company
undertakes no obligation to publicly update any forward-looking statements whether as a result of
new information, future events or otherwise.
About Tekelec
Tekelec enables billions of people and devices to talk, text and access the Web. Our portfolio
delivers a unique layer of intelligence allowing service providers to both manage and monetize the
exponential growth in data traffic and applications. Tekelec has more than 25 offices around the
world serving customers in more than 100 countries. For more information, please visit
www.tekelec.com.
Contacts:
Adam Parken | Public Relations Manager
(o) +1.919.653.9681 | adam.parken@tekelec.com
(o) +1.919.653.9681 | adam.parken@tekelec.com
Kyle Macemore | Vice President Finance and Investor Relations
(o) +1 919.380.6148 | kyle.macemore@tekelec.com
(o) +1 919.380.6148 | kyle.macemore@tekelec.com
5200 Paramount Parkway, Morrisville, N.C., USA 27580 TEL +1.919.460.5500 FAX +1.919.460.0877