HighWave's six months results reveal 89% revenue drop

Nov. 15, 2002
15 November 2002 -- HighWave Optical Technologies, Lannion, France, today announced half fiscal year 2003 consolidated financial results. Revenues were down 89% to EUR2.3m.

15 November 2002 -- HighWave Optical Technologies, Lannion, France, today announced half fiscal year 2003 consolidated financial results. Revenues were down 89% to EUR2.3m.

Revenues for the first six months of fiscal year 2003, covering the period from 1st April to 30 September 2002, decreased by 89% to EUR2.3m, compared to EUR20.9 million for the same period in the previous fiscal year. The operating loss for the first six months was EUR19.3m, compared to EUR28.8m a year ago, a 33% improvement.

The net loss for the first six months of the fiscal year 2003 was EUR22.9 million, (EUR0.40) diluted loss per share, compared to a loss of EUR30.3 million, or (EUR1.73) diluted loss per share for the same period last fiscal year.

"In a particularly challenging environment, we have pursued our efforts to reduce costs and to adapt the company to the prevailing market conditions." stated Eric Delevaque, Chief Executive Officer. He added "Our efforts have been successful as is reflected in our results which track our budget forecasts. In parallel to cost control, our main priority is the resumption of commercial activities."

Restructuring Programme
In the pursuit of our cost reduction efforts, the company has implemented different measures during the last six months. All activities have been consolidated in Lannion. The Marseille subsidiary was sold. The US and UK subsidiaries are in the process of closure. The Ulis site has been put up for sale.

The Rennes site is closed and the one in Tregastel is only used as a warehouse. Moreover, the company has implemented a downsizing plan bringing its workforce to 65 people. Finally, excess inventory will be auctioned on 5 December 2002.

For the first six months of fiscal year 2003, general expenses were EUR2.8m, compared to EUR6.6m for the first six months of the preceding fiscal year, a decrease of 58%. Moreover wages and salaries were EUR7.6m compared to EUR17.7m in the first six months of the preceding fiscal year, a decrease of 57%.

The operational results for these six months take into account restructuring costs of EUR7.1m (provisions on intangible and tangible assets of EUR3.1 million, provisions of EUR2.4m for the layoffs, and general provisions of EUR1.6m.

The consolidated net result also includes the restructuring expenses of EUR2.3 million for the closure of the Marseille subsidiary.

On 30 September 2002, net cash balance of the Company was EUR16.2m, compared to EUR27.6m on 31 March 2002. The monthly cash consumption which stood at EUR3.3m in the course of the first six months of the preceding financial year, was EUR2.6 million in the course of the first quarter of the current fiscal year, falling to EUR1.1m in the second quarter, a decrease of 67%.

"Despite a decrease of 89% in our revenues we have reduced our losses by 33%," announced Arnaud Chazalon, Chief Executive Officer. "Our monthly cash consumption of ?1.1 million is in line with our forecast. It will be further reduced by the end of March 2003. Our main objective now is to return as soon as possible to profitability. Our priorities are clear and the whole Company is focused on this principle."

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