Alvarion Ltd. (Nasdaq: ALVR; TASE: ALVR), which provides wireless broadband solutions, released its first quarter financials today. At the same time, Alvarion acting CEO Assaf Katan announced that the company plans raising equity through a private placement (PIPE). "We are moving forward in building the company anew," he said. Alvarion had $3.5 million in cash at the end of the first quarter of 2013, an amount that would have grown by $1.3 million with the receipt of a payment from the sale of its WiMAX division to Telrad Networks.
Alvarion is currently trading at an all-time low market cap of $17 million and this could be an attractive pricing for potential investors.
Revenue in the first quarter of 2013 was $8.5 million, representing an increase of 4.5% from $8.2 million in the fourth quarter of 2012, and a decrease of 45.4% from $15.6 million in the first quarter of 2012.
The company made a GAAP net loss from continuing operations in the first quarter of 2013 of $3.9 million, or $0.62 per share. This compares with a GAAP net loss from continuing operations of $5.2 million, or $0.82 per share, in the fourth quarter of 2012. The GAAP net loss from continuing operations in the first quarter of 2012 was $3.9 million, or $0.62 per share.
On a non-GAAP basis, excluding loss from discontinued operations, amortization of intangible assets, stock-based compensation and acquisition related expenses, the company reported a net loss of $3.2 million, or $0.51 per share, compared with a non-GAAP net loss of $4.3 million, or $0.69 per share, in the fourth quarter of 2012, and a non-GAAP net loss of $2.7 million, or $0.43 per share, in the first quarter of 2012.
In addition, the company reported a net loss per share from discontinued operations of $0.49 for the first quarter of 2013, compared with a net loss per share of $1.99 and $0.48 for the fourth quarter of 2012 and first quarter of 2012, respectively.
The first quarter 2013 results and all comparative periods reflect results of operations of the company’s continuing vertical and carrier unlicensed solutions business. The company’s licensed carrier business is classified as discontinued operations. Earnings per share are adjusted for all periods presented in accordance with the 1:10 reverse split effected on April 2, 2013.
Cash used in continuing operations in the first quarter of 2013 was $3.2 million. At the end of the first quarter of 2013, the company had cash, cash equivalents and investments, including restricted cash, totaled $5.8 million, after a $4.3 million principal loan repayment. Total debt at the end of the quarter was $6.7 million.
“Following the sale of our licensed carrier business, Alvarion is focusing on providing wireless solutions to high growth markets, including solutions for vertical markets, mobile offload and Wi-Fi access,” said Katan, “We are seeing solid demand for our product offering from customers, which we expect to support our growth in the second half of 2013. At the same time, we are actively considering alternatives to raise additional equity capital for the company to improve our financial position. The additional financing will also allow us to shorten and improve our delivery cycle which is adversely affecting our results in the first half of the year.”
Speaking about the company's troubles Katan said, "There were problems with the new generation of our product. We have relaunched significant new products and we expect a substantial improvement in the second quarter of 2013."
How will the company look in another year or two?
"We are approaching milestones - to make the company stable and reach a break even point. It wouldn't be right to try and sell a great vision. The time for modesty has arrived."
Published by Globes [online], Israel business news - www.globes-online.com - on May 20, 2013
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