Company Update (NASDAQ:ARRS): ARRIS International plc Reports Preliminary and Unaudited Fourth Quarter and Full Year 2015 Results


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ARRIS International plc (NASDAQ:ARRS) announced preliminary and unaudited financial results for the fourth quarter and full year 2015.

Financial Highlights

  • Revenues were $1,101.7 million
  • Adjusted net income (a non-GAAP measure) was $0.62 per diluted share, which includes a $0.14 per diluted share benefit related to research & development tax credits
  • GAAP net income was $0.20 per diluted share
  • Ended 2015 with $879.1 million of cash resources
  • Order backlog was $715.8 million
  • Book-to-bill ratio was 1.14
  • Approved $300 million share repurchase program

“Our fourth quarter sales were in line with our expectations, and our earnings were stronger than anticipated as a result of stronger CCAP E6000 sales, as well as the full year impact of R&D tax credits enacted by Congress late in the year,” said Bob Stanzione, ARRIS Chairman and CEO.  “We closed the Pace acquisition on January 4 and have made substantial progress on our integration activities.  With respect to the first quarter 2016, we project that revenues for the Company will be in the range of $1,560 to $1,610 million, with adjusted net income per diluted share in the range of $0.37 to $0.42 and GAAP net income per diluted share in the range of $0.01 to $0.06.”

The Company also announced that on February 16, 2016, the Board of Directors of ARRIS approved a new $300 million share repurchase authorization replacing all prior programs.

ARRIS will host its 2016 Investor & Analyst Day on Wednesday, March 16 at The Westin at Times Square, New York City.  The event, which is open to investors and analysts, will begin at 7:30 a.m. Eastern with breakfast and registration. Presentations will begin at 8:00 am and conclude at approximately 12:00 pm. A live audio webcast of the conference with slide presentations will be accessible via the Investors section of Company’s web site: www.arris.com.  Registration for the event can be found atwww.etouches.com/161362.

Revenues in the fourth quarter 2015 were $1,101.7 million as compared to fourth quarter 2014 revenues of $1,263.4 million. Third quarter 2015 revenues were $1,221.4 million.

For the full year 2015 and 2014, revenues were $4,798.3 million and $5,322.9 million, respectively.

Adjusted net income (a non-GAAP measure) in the fourth quarter 2015 was $0.62 per diluted share, compared to $0.78 per diluted share for the fourth quarter 2014.  Adjusted net income (a non-GAAP measure) for the third quarter 2015 was $0.56 per diluted share.    The fourth quarter 2015 adjusted net income includes a $0.14 benefit related to the full year impact of research & development tax credits resulting from Congress passing legislation in December 2015.

Full year, adjusted net income was $2.16 per diluted share for 2015 as compared to $2.76 per diluted share in 2014.

GAAP net income in the fourth quarter 2015 was $0.20 per diluted share, as compared to fourth quarter 2014 GAAP net income of $1.29 per diluted share and third quarter 2015 GAAP net income of $0.18 per diluted share. The fourth quarter 2015 GAAP net income includes a net $0.14 benefit associated with the full year impact of research & development tax credits.

Full year, GAAP net income was $0.62 per diluted share in 2015 as compared to GAAP net income of $2.21 per diluted share in 2014.

Cash & Cash Equivalents – The Company ended the fourth quarter 2015 with $879.1 million of cash resources, which includes cash, cash equivalents and short-term investments, as compared to $781.1 million, in the aggregate, at the end of the third quarter 2015.  The Company generated $127.4 million of cash from operating activities during the fourth quarter 2015, as compared to $130.0 million generated during the fourth quarter 2014.  During the full year of 2015, the Company generated $351.9 millionof cash from operating activities, which compares to $459.3 million generated during 2014.

Order backlog at the end of the fourth quarter 2015 was $715.8 million as compared to $631.0 million and $559.0 million at the end of the fourth quarter 2014 and the third quarter 2015, respectively. The Company’s book-to-bill ratio in the fourth quarter 2015 was 1.14 as compared to the fourth quarter 2014 of 1.03 and the third quarter 2015 of 0.92. (Original Source)

Shares of Arris Group tumbled nearly 11% in after-hours trading. ARRS has a 1-year high of $37.50 and a 1-year low of $23.94. The stock’s 50-day moving average is $26.15 and its 200-day moving average is $27.88.

On the ratings front, Arris has been the subject of a number of recent research reports. In a report issued on January 8, Barclays analyst Joseph Wolf maintained a Buy rating on ARRS, with a price target of $41, which represents a potential upside of 69.1% from where the stock is currently trading. Separately, on October 29, Needham’s Richard Valera maintained a Buy rating on the stock and has a price target of $34.

According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Joseph Wolf and Richard Valera have a total average return of -9.3% and 0.8% respectively. Wolf has a success rate of 33.3% and is ranked #3249 out of 3610 analysts, while Valera has a success rate of 48.4% and is ranked #1266.

ARRIS International PLC, formerly ARRIS Group Inc provides entertainment & communications solutions. It provides Customer Premises Equipment including set-top, gateway, DSL & cable modem; and Network & Cloud including video infrastructure.