-- Key IFRS differences relate to inventory valuation,
capitalization of development expenses, and stock options
-- Due to potential retrospective changes in the standards, IFRS
financial statements are preliminary until year-end 2005
-- Key IFRS financials provided from Q1 2005 onwards
MARTINSRIED and MUNICH, Germany and MAHWAH, N.J., April 20, 2005 (PRIMEZONE) -- ADVA Optical Networking today provided details on the conversion of its 2004 U.S. GAAP financial statements, which were published on March 10, 2005, into International Financial Reporting Standards ("IFRS") in accordance with new regulations for European-listed companies.
2004 FINANCIAL STATEMENTS UNDER IFRS
Overall, ADVA achieved an IFRS operating income of EUR 8.5 million in 2004 vs. EUR 7.8 million as reported under U.S. GAAP. IFRS net income for the year 2004 was EUR 7.2 million vs. EUR 6.7 million as reported under U.S. GAAP. IFRS-based pro forma operating income amounted to EUR 12.9 million in 2004 vs. EUR 12.3 million as based on U.S. GAAP, and ADVA achieved IFRS-based pro forma net income for the year of EUR 11.6 million vs. EUR 11.3 million as based on U.S. GAAP. The pro forma numbers are calculated prior to non-cash charges related to the stock option programs, amortization and impairment of goodwill and acquired intangible assets. The conversion of the financial statements did not impact U.S. GAAP reported revenues of EUR 102.1 million in 2004. Key IFRS standards which impact ADVA's 2004 financial statements relate to inventory valuation, the capitalization of development expenses, and stock options.
PRELIMINARY NATURE OF 2004 IFRS FINANCIAL STATEMENTS
ADVA provides its reviewed IFRS opening and closing balance sheets at January 1 and December 31, 2004, as well as annual and quarterly results for the year 2004, based on the assumption that the applicable IFRS / IAS standards at the time of preparation are still applicable on December 31, 2005. Changes of the currently-applicable standards by the International Accounting Standards Board (IASB) may result in changes to the 2004 IFRS financial statements published today. Hence, these financial statements will be considered as preliminary until December 31, 2005.
KEY IFRS FINANCIALS PROVIDED FROM Q1 2005 ONWARDS
Starting with the release of ADVA's financial statements for the first quarter 2005 on May 10, 2005, key IFRS financial information will be provided in addition to the U.S. GAAP financial statements on a quarterly basis. ADVA will continue to apply U.S. GAAP as the primary accounting framework for 2005 quarterly reporting, and will provide 2005 financial guidance only in accor-dance with U.S. GAAP. In order to comply with recently-enacted legislation for European-listed companies, ADVA will start applying IFRS standards as primary accounting framework with the release of its annual report 2005 in 2006.
CONFERENCE CALL AND WEBCAST
In conjunction with the release of its 2004 IFRS financial statements, ADVA will host a conference call for investors today, Wednesday, April 20, 2005, at 4:00 pm CEDT / 10:00 am EDT. Investors may dial in directly to participate in the call, or listen live via webcast on ADVA's website. Participating in the call will be ADVA's Chief Financial Officer, Andreas G. Rutsch; and Wolfgang Guessgen, Director Investor Relations. To listen to the webcast, analysts and investors are encouraged to go to the "financial results -- earnings webcasts" page in the investor relations section of ADVA's website at www.advaoptical.com. The call will be later archived as an audio file and the conference call presentation will also be available in the investor relations section of ADVA's website.
ABOUT ADVA OPTICAL NETWORKING
ADVA Optical Networking (FSE:ADV) is a leading global provider of optical and Ethernet networking solutions for rapid and cost-effective provisioning of high-speed data, storage, voice, and video services in the metropolitan area. ADVA's carrier-class Fiber Service Platform (FSP) product portfolio is explicitly designed to enhance services, simplify networks, and reduce the total cost of ownership. ADVA's solutions have been deployed at over 100 carriers and several thousand enterprises worldwide. For further information about ADVA: www.advaoptical.com.
ADVA Optical Networking provides consolidated pro forma financial results in this presentation solely as supplemental financial information to help investors and the financial community make meaningful comparisons of ADVA's operating results from one financial period to another. ADVA believes that these pro forma consolidated financial results are helpful because they exclude non-cash charges related to the stock option programs, purchased in-process R&D, as well as amortization of acquired intangible assets, which are not reflective of the company's operating results for the period presented. This pro forma information is not prepared in accordance with U.S. GAAP / IFRS and should not be considered a substitute for historical information presented in accordance with U.S. GAAP / IFRS.
PUBLISHED BY:
ADVA AG Optical Networking, Martinsried/Munich and Meiningen, Germany ADVA Optical Networking Inc., Mahwah/New Jersey, USA ADVA Optical Networking Corp., Tokyo, Japan www.advaoptical.com