MORRISVILLE, N.C. – Telecommunications gear manufacturer Tekelec cut its fourth quarter losses but still remained in the red due to one-time charges.
The news exceeded Wall Street estimates and sparked a 5 percent jump, or 73 cents per share, in after-hours trading to $15.63.
Thursday after the markets closed, Tekelec (NASDAQ: TKLC) said it reduced its fourth-quarter loss to $1.2 million, or 2 cents per share, on revenues of $154.5 million. Revenues increased 11 percent from the same quarter in 2005. Its losses in the fourth quarter of 2005 were $47.9 million, but much of that was from a one-time charge.
If not for one-time charges, Tekelec would have reported a $7.2 million profit, or 10 cents per share. Analysts surveyed by Thomson Financial had expected $138.6 million in revenue and a 3 cent per share profit excluding special charges.
“We are pleased with our fourth quarter results,” said Frank Plastina, Tekelec’s chief executive officer. “In particular, our order input reflected several new customer wins for our Network Solutions Group, and our Communications Software Solutions Group was profitable for the year on an operating basis.”
For the year on a non-generally accepted accounting basis, Tekelec did show a profit of $86.1 million, or $1.28 per share, on revenues of $553.6 million. In 2005, Tekelec lost $33.7 million.
On a GAAP basis, Tekelec lost $103.2 million, including $100.6 million in write-downs for goodwill and technology assets plus $7.2 million in restructuring costs and $34.7 million in stock-based compensation expense.
Also Thursday, Tekelec reaffirmed that it was continuing to evaluate the potential sale of its switching technology business.
Tekelec reported a backlog of $455.3 million in orders as of Dec. 31. That is down from $520.2 million as of Dec. 31, 2005.
A $2.8 million tax credit for research and development helped boost fourth-quarter earnings.