CommScope Announces Record Third Quarter 2007 Results

HICKORY, N.C., Oct. 30 /PRNewswire-FirstCall/ -- -- Record third quarter EPS of $0.81; up 33 percent year over year -- Record third quarter sales of $514 million, up 10 percent year over year -- Operating income increases more...


HICKORY, N.C., Oct. 30 /PRNewswire-FirstCall/ -- -- Record third quarter EPS of $0.81; up 33 percent year over year -- Record third quarter sales of $514 million, up 10 percent year over year -- Operating income increases more than 25 percent to $81 million -- Operating margin of 15.8 percent -- Orders of $482 million, up 25 percent year over year

CommScope, Inc. (NYSE: CTV), a global leader in infrastructure solutions for communications networks, today announced record third quarter results for the period ended September 30, 2007 .

For the third quarter of 2007, CommScope reported sales of $513.6 million and net income of $60.3 million, or $0.81 per diluted share. For the third quarter of 2006, CommScope reported sales of $466.1 million and net income of $43.6 million, or $0.61 per diluted share. The reported net income for the third quarter of 2006 included after-tax charges of $1.9 million related to restructuring costs. Excluding this special item, adjusted third quarter 2006 earnings were $45.5 million, or $0.64 per diluted share.

"We are pleased to deliver another strong quarter as all of our operating segments continue to benefit from the global demand for bandwidth," said CommScope Chairman and Chief Executive Officer, Frank M. Drendel. "We believe that video, data intensive applications, mobility and dynamic websites create an ongoing need for infrastructure solutions for communication networks. With our acquisition of Andrew Corporation on track to be completed by the end of this year, we believe that CommScope, as a global leader in 'last mile' infrastructure solutions, will be solidly positioned to continue to benefit from these long-term trends," Drendel added.

Sales Overview

Sales for the third quarter of 2007 increased 10.2 percent year over year, primarily driven by increased volume in all three segments, with particular strength in the Carrier segment.

Enterprise segment sales rose 1.1 percent year over year to $240.4 million, primarily due to higher sales volume. Enterprise revenues grew slightly year over year despite unusually strong third quarter 2006 sales. Sales in the third quarter of 2006 had been positively affected by a particularly strong backlog coming into the year-ago quarter. This backlog resulted from longer lead times associated with the company's global manufacturing initiatives and volatile raw material costs.

CommScope announced price increases on selected Enterprise cable and apparatus late in the third quarter of 2007 in response to higher costs. The company expects limited revenue and gross margin benefit from these price increases during the fourth quarter of 2007.

Broadband segment sales rose 12.1 percent year over year to $161.2 million, primarily due to higher sales volumes, particularly in the Central and Latin American region, and the positive impact of the Signal Vision, Inc. acquisition, which closed on May 1, 2007 . Competition between domestic Multiple System Operators (MSOs) and domestic wireline carriers continues to drive investment by MSOs in their networks.

Carrier segment sales increased 32.1 percent year over year to $112.3 million. These robust sales result from strong growth in all Carrier product areas. CommScope's Integrated Cabinet Solutions (ICS) increased as large domestic wireline carriers continue to deploy electronics deeper in their networks to offer higher bandwidth broadband and video services. Strong international sales growth of CommScope's Extremeflex(R) smooth wall aluminum cables to major wireless carriers also drove Carrier performance.

Total international sales for the third quarter of 2007 rose 19.0 percent year over year to $168.5 million, or approximately 32.8 percent of total company sales.

External orders booked in the third quarter of 2007 were $482.3 million, up 25.4 percent from the year-ago quarter.

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