Sandvine Provides Fourth Quarter Revenue Estimate
Waterloo, ON; December 6, 2011 –Sandvine, (TSX:SVC; AIM:SAND) a leading provider of intelligent broadband network solutions, today announced a preliminary revenue estimate for the fourth quarter of 2011 ended on November 30, 2011. The Company expects fourth quarter revenue to be in the range of $19.5 million to $20 million. Based on this, the Company estimates that its fiscal 2011 revenue will be in the range of $88.2 million to $88.7 million. The Company expects to release its full financial results on January 12, 2012.
“Our revenue in the fourth quarter, and for the year, was lower than expected. Several of our largest customers did not generate the level of business we had anticipated for a variety of reasons, including budget reductions during the course of the year, shifting capital priorities and slower roll-outs,” said Dave Caputo, Sandvine’s President and CEO. “We have built a solid base of business with the largest and most diversified customer base in our space, and our focus in 2012 will be to generate growth in our business from that installed base and from winning new customers. We are encouraged by the level of our engagement at a number of larger new opportunities and are optimistic that some of those opportunities will begin to translate to orders in fiscal 2012.”
The Company will discuss this news on a conference call today at 8:30 a.m. Eastern time (1:30 BST). A webcast will be available on Sandvine’s website.
Local dial-in number 416-644-3415
Toll-free North America 800-814-4860
Toll-free United Kingdom 0800-358-5256
A replay of the call will be available at 416-640-1917 or toll-free at 877-289-8525 (passcode 4495627#from approximately 10:30 a.m. Eastern time today through December 13.
Sandvine’s network policy control solutions focus on protecting and improving the quality of experience on the Internet. Our award-winning network policy control equipment and software helps fixed and mobile operators better understand network traffic, manage network congestion, create new services and revenues, mitigate traffic that is malicious or undesirable to subscribers, deliver QoS-prioritized multimedia services and increase subscriber satisfaction. With over 200 service provider customers in over 85 countries, serving hundreds of millions of broadband and mobile data subscribers, Sandvine is enhancing the Internet experience worldwide. For more information, please visit: www.sandvine.com.
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Canaccord Genuity Limited
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Certain statements in this press release which are not historical facts constitute forward-looking statements or forward-looking information within the meaning of applicable securities laws ("forward-looking statements"). Statements related to Sandvine’s projected revenues, earnings, growth rates, revenue mix and product plans are forward-looking statements as are any statements relating to future events, conditions or circumstances. The use of terms such as “may”, “anticipated”, “expected”, “projected”, “targeting”, “estimate”, “intend” and similar terms are intended to assist in identification of these forward-looking statements. Readers are cautioned not to place undue reliance upon any such forward-looking statements. Such forward-looking statements are not promises or guarantees of future performance and involve both known and unknown risks and uncertainties that may cause the actual results, performance, achievements or developments of the Company to differ materially from the results, performance, achievements or developments expressed or implied by such forward-looking statements. Forward-looking statements are based on management’s current plans, estimates, projections, beliefs and opinions, and the Company does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change.
Many factors could cause the actual results of the Company to differ materially from the results, performance, achievements or developments expressed or implied by such forward-looking statements, including, without limitation, each of the following factors, and those factors which are further discussed in the Company’s Annual Information Form (“AIF”), a copy of which is available on SEDAR at www.sedar.com.
- The results discussed in this release are preliminary and remain subject to ongoing review by Sandvine’s auditors and final approval by Sandvine’s Audit Committee and Board of Directors;
- The Company’s revenues may fluctuate from quarter to quarter and year to year depending upon sales cycles, customer demand and the timing of customer purchase decisions;
- The Company’s gross margins may fluctuate from period to period depending upon a variety of factors including product mix in the quarter, competitive pricing pressures and the level of sales generated through indirect channels;
- The Company is dependent upon and expects to continue to derive a large percentage of its revenue from both a small number of key customers and key reseller partners, none of whom are bound to any fixed purchase commitment or exclusivity obligations and could change their buying patterns and/or source of supply at any time, which could have a material impact on the Company’s revenues. The Company’s reseller partners may offer their own products which are competitive with the Company’s products;
- The Company faces intense competition in markets where there are typically several different competing technologies and rapid technological changes. The Company faces the risk of emergence of new technologies that may be either competitive to those of the Company or that change the requirements of the Company’s customers for solutions such as those offered by the Company;
- The Company’s growth is dependent on the development of the market for intelligent broadband network management solutions and the decisions of the Company’s target customers to deploy and further invest in those technologies, which decisions may be impacted upon by changing requirements in the area of broadband network management policies and/or changes in the regulatory framework to which the Company’s customers may be subject. In particular, numerous telecommunications regulators in various jurisdictions have considered or are considering what, if any, regulations might be appropriate with respect to how internet service providers manage the impact of different types of traffic on their networks. These ongoing processes may cause uncertainty in the network investment decisions of the Company’s target customers, and any new rules or regulations that result from these considerations may impact the demand for the Company’s products within various markets, including markets that may not be considering any new regulation but where the Company’s customers may look to other markets for future guidance or trends;
- The majority of the Company’s operating expenses are denominated in Canadian dollars, U.S. dollars and New Israeli Shekels while its revenues and cost of sales are generally denominated in U.S. dollars. The Company’s earnings are impacted by fluctuations in the exchange rates between these and other currencies in which the Company trades.