UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
Form
6-K
REPORT
OF FOREIGN PRIVATE ISSUER
PURSUANT
TO RULE 13a-16 OR 15d-16
OF
THE SECURITIES EXCHANGE ACT OF 1934
For
the
month of May 2006
Commission
File Number: 0-30628
ALVARION
LTD.
(Translation
of registrant’s name into English)
21A
Habarzel Street, Tel Aviv 69710, Israel
(Address
of principal executive office)
Indicate
by check mark whether the registrant files or will file annual reports under
cover of Form 20-F or Form 40-F.
Form 20-F þ
Form
40-F o
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(1): ____
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(7): ____
Indicate
by check mark whether by furnishing the information contained in this Form,
the
registrant is also thereby furnishing the information to the Commission pursuant
to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes
o
No
þ
If
“Yes”
is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): 82-___________
The
following are included in this report on Form 6-K:
|
Exhibit
|
Description
|
Sequential
Page
Number
|
|
1.
|
Press
release on ALVARION
REPORTS FIRST QUARTER 2006 RESULTS Continued
sequential growth, Reduced non-GAAP Loss; Maintained WiMAX Leadership
dated
May
10,
2006
|
4
|
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
ALVARION
LTD.
Date:
May 10, 2006 By:
/s/ Dafna
Gruber
Name: Dafna
Gruber
Title: Chief
Financial Officer
Contacts
ALVARION ALVARION
Dafna
Gruber, CFO, 650 314 2652
+972-3-645
6252
Carmen
Deville, 650 314 2653
dafna.gruber@alvarion.com
carmen.deville@alvarion.com
ALVARION
REPORTS FIRST QUARTER 2006 RESULTS
Continued
sequential growth, Reduced non-GAAP Loss; Maintained WiMAX Leadership
TEL
AVIV, Israel—May 10, 2006 -- Alvarion Ltd. (NASDAQ: ALVR),
the
leading provider of wireless broadband solutions and specialized mobile
networks, today announced financial results for the first quarter ended March
31, 2006.
Revenue
for the first quarter reached $48.1 million, up 3% sequentially from $46.5
million in the fourth quarter of 2005. Revenue in Q1 2006 declined 16% from
$57.2 million in the first quarter of 2005, primarily reflecting a higher
revenue contribution from one large customer during the first quarter of 2005.
Gross
margin was 46% in Q1 of 2006, exceeding the company’s target gross margin of
45%.
On
a GAAP
basis, the company reported a net loss of $(5.0) million, or ($0.08) per share,
compared with a net loss of $(3.9) million, or $(0.07) per share in Q4 2005,
and
net profit of $356,000, or $0.01 per basic and diluted share in the first
quarter of 2005. The net loss in Q1 2006 reflects the adoption of SFAS 123R
(“Share-Based Payment”) for the first time, and includes amortization of
deferred stock compensation of $1.5 million, compared with $11,000 in Q4 2005
and $530,000 in Q1 2005.
Excluding
amortization of acquired intangibles and deferred stock compensation and one
time charges, on a non-GAAP basis, Q1 2006 net loss was ($2.4(
million,
or ($0.04) per share,
compared
with a net loss of ($3.8)
million, or ($0.06) per share in the fourth quarter of 2005, and a non-GAAP
net
profit of $2.8 million, or $0.04 per diluted share in Q1 of 2005.
For
supplemental information to facilitate evaluation of the impact of adopting
SFAS
123R and comparisons with historical results, see the attached table showing
the
detailed reconciliation of GAAP to non-GAAP for Q1 2006.
Comments
of Management
“We
are
pleased with the continued sequential growth in Q1, particularly during a period
that traditionally has been a seasonally weak quarter,” said Tzvika Friedman,
President and CEO of Alvarion. “This quarter we improved gross margin and
significantly reduced our non-GAAP loss.
“We
continue to lead the adoption of WiMAX,” continued Mr. Friedman. “Since we
introduced our BreezeMAX solution, it has generated over $50 million in revenue,
many times the sales of other vendors’ WiMAX products. In Q1, BreezeMAX again
grew to reach 28% of our total revenue, compared with about 10% in the same
period last year. With 55 commercial deployments and about 100 active trials,
we
are still at the very beginning of the adoption curve. We believe deployments
will be expanded and trials will translate into additional business once some
of
the operators complete their technology qualification cycle or obtain licenses
for spectrum, and once WiMAX solutions are available in additional frequencies,
and self-install subscriber units become widely available. We are expecting
progress in each of these areas in the second half of this year.
“Revenue
from our other broadband wireless solutions remained steady and we are
continuing to expand our customer base in frequencies where there is no WiMAX
profile and in the unlicensed bands. We recently signed a worldwide strategic
partnership agreement with IBM and have won several deals with them in the
municipal broadband market in the U.S.
“As
a
result of a disappointing level of orders in our cellular mobile unit (“CMU”) so
far in Q2 and our assessment of the outlook, we have decided to refocus the
business to concentrate on generating positive cash flow, mainly from our GSM
solutions, while supporting all current customers. We are beginning an analysis
to determine the possible need for a certain non-cash charge in Q2 for
impairment of some of the intangible assets related to this business.”
Mr.
Friedman continued, “In Q1 we reached an important milestone for the whole
industry with the first live showcase of our mobile WiMAX solution called
4Motion™ at the CTIA show in Las Vegas. 4Motion is our complete WiMAX
802.16e-2005 solution portfolio that we are developing in conjunction with
leading providers of core network and IP technology to make personal broadband
anywhere a reality. We are constantly shifting more of our resources toward
802.16e-2005 4Motion solutions which are gaining increased interest and
attention from a wide variety of operators.”
Q2
Guidance
The
Company’s revenue guidance for Q2 2006 is $48 million to $52 million. At this
revenue range, non-GAAP per share results are expected to range between a loss
of 2 and 5 cents per share. This guidance excludes expenses related to
amortization of acquired intangibles, the effect of stock option expensing,
and
any possible one-time charges for the CMU business, if any. Since it is too
early to indicate the impact of these charges, and whether or not certain of
these charges will occur, the company will not provide GAAP earnings per share
guidance.
Alvarion’s
management will host a conference call today, May 10, at 9:00 a.m. Eastern
time
to discuss the quarter. To participate in the call, please dial one of the
following numbers approximately five minutes prior to the scheduled start time:
USA: 612-332-0228, International: +1-612-332-0228.
The
public is invited to listen to the live webcast of the conference call. For
details please visit Alvarion’s website at www.alvarion.com. An archive of the
on-line broadcast will be available on the website. A replay of the call will
be
available from 11:45a.m. EDT on May 10, 2006 through 11:59 p.m. EDT on May
17,
2006. To access the replay, please call USA: (320) 365-3844, International:
+1-320-365-3844. To access the replay, users will need to enter the following
code: 826643.
About
Alvarion
With
more
than 2 million units deployed in 140 countries, Alvarion is the worldwide leader
in wireless broadband, providing systems to carriers, ISPs and private network
operators, and also in extending coverage of GSM and CDMA mobile networks to
developing countries and other hard to serve areas.
Leading
the WiMAX revolution, Alvarion has the most extensive deployments and proven
product portfolio in the industry covering the full range of frequency bands
with both fixed and mobile solutions. Alvarion’s products enable the delivery of
business and residential broadband access, corporate VPNs, toll quality
telephony, mobile base station feeding, hotspot coverage extension, community
interconnection, public safety communications, and mobile voice and data.
Alvarion works with several global OEM providers and more than 200 local
partners to support its diverse global customer base in solving their last-mile
challenges.
As
a
wireless broadband pioneer, Alvarion has been driving and delivering innovations
for more than 10 years from core technology developments to creating and
promoting industry standards. Leveraging its key roles in the IEEE and HiperMAN
standards committees and experience in deploying OFDM-based systems, the
Company's prominent work in the WiMAX Forum™ is focused on increasing the
widespread adoption of standards-based products in the wireless broadband market
and leading the entire industry to mobile WiMAX solutions.
For
more
information, visit Alvarion’s World Wide Web site at www.alvarion.com
This
press release contains forward -looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These statements are based on the current expectations or beliefs of
Alvarion’s management and are subject to a number of factors and uncertainties
that could cause actual results to differ materially from those described in
the
forward -looking statements. The following factors, among others, could cause
actual results to differ materially from those described in the forward-looking
statements: inability to further identify, develop and achieve success for
new
products, services and technologies; increased competition and its effect on
pricing, spending, third-party relationships and revenues; as well as the
inability to establish and maintain relationships with commerce, advertising,
marketing, and technology providers and other risks detailed from time to time
in filings with the Securities and Exchange Commission.
Information
set forth in this press release pertaining to third parties has not been
independently verified by Alvarion and is based solely on publicly available
information or on information provided to Alvarion by such third parties for
inclusion in this press release. The web sites appearing in this press release
are not and will not be included or incorporated by reference in any filing
made
by Alvarion with the Securities and Exchange Commission, which this press
release will be a part of.
You
may
request Alvarion's future press releases or a complete Investor Kit by
contacting Carmen Deville, Investor Relations: carmen.deville@alvarion.com
or
+1.650.314.2653.
ALVARION
LTD.& ITS SUBSIDIARIES
CONDENSED
CONSOLIDATED BALANCE SHEETS
U.S.
dollars in thousands
|
March
31,
|
December
31,
|
||||||
|
|
2005
|
2006
|
|||||
|
ASSETS
|
|||||||
|
Cash,
cash equivalents,short-term and
|
|||||||
|
long-term
investments
|
$
|
109,419
|
$
|
114,320
|
|||
|
Trade
receivables
|
40,985
|
39,271
|
|||||
|
Other
accounts receivable
|
5,854
|
6,179
|
|||||
|
Inventories
|
38,169
|
43,363
|
|||||
|
Severance
pay fund
|
7,714
|
7,685
|
|||||
|
PROPERTY
AND EQUIPMENT, NET
|
11,241
|
11,072
|
|||||
|
GOODWILL
AND OTHER INTANGIBLE ASSETS
|
95,021
|
96,112
|
|||||
|
TOTAL
ASSETS
|
$
|
308,403
|
$
|
318,002
|
|||
|
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
|||||||
|
CURRENT
LIABILITIES
|
|||||||
|
Trade
payables
|
$
|
24,963
|
$
|
29,093
|
|||
|
Other
accounts payable and accrued
|
|||||||
|
Expenses
|
48,612
|
51,820
|
|||||
|
Total
current liabilities
|
73,575
|
80,913
|
|||||
|
LONG
TERM LIABILITIES
|
-
|
1,749
|
|||||
|
ACCRUED
SEVERANCE PAY
|
11,342
|
11,007
|
|||||
|
TOTAL
LIABILITIES
|
84,917
|
93,669
|
|||||
|
SHAREHOLDERS'
EQUITY
|
223,486
|
224,333
|
|||||
|
TOTAL
LIABILITIES AND SHAREHOLDERS' EQUITY
|
$
|
308,403
|
$
|
318,002
|
|||
ALVARION
LTD.& ITS SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
U.S.
dollars in thousands (except per share data)
|
Three
Months
Ended
March
31,
|
Three
Months
Ended
March
31,
|
Three
Months
Ended
March
31,
|
Year Ended
December
31,
|
||||||||||
|
2006
|
2005
|
2005
|
2006
|
||||||||||
|
Sales
|
$
|
48,059
|
$
|
57,233
|
$
|
46,483
|
$
|
195,715
|
|||||
|
Cost
of sales
|
26,012
|
30,739
|
25,631
|
106,439
|
|||||||||
|
Gross
profit
|
22,047
|
26,494
|
20,852
|
89,276
|
|||||||||
|
Operating
expenses:
|
|||||||||||||
|
Research
and development, net
|
11,006
|
9,356
|
9,779
|
38,921
|
|||||||||
|
Selling
and marketing
|
12,125
|
11,989
|
12,584
|
48,794
|
|||||||||
|
General
and administrative
|
3,461
|
3,380
|
1,974
|
11,495
|
|||||||||
|
Amortization
of acquired current technology, customer
relationships
and trademarks
|
1,091
|
1,094
|
1,091
|
4,367
|
|||||||||
|
Acquisition
related expenses
|
-
|
868
|
-
|
868
|
|||||||||
|
Total
Operating expenses
|
27,683
|
26,687
|
25,428
|
104,445
|
|||||||||
|
Operating
loss
|
(5,636
|
)
|
(193
|
)
|
(4,576
|
)
|
(15,169
|
)
|
|||||
|
Financial
income, net
|
668
|
549
|
681
|
2,551
|
|||||||||
|
Net
profit (loss)
|
$
|
(4,968
|
)
|
$
|
356
|
$
|
(3,895
|
)
|
$
|
(12,618
|
)
|
||
|
Basic
earnings (loss) per Share
|
$
|
(0.08
|
)
|
$
|
0.01
|
$
|
(0.07
|
)
|
$
|
(0.22
|
)
|
||
|
|
|||||||||||||
|
Weighted
average number of shares used in computing
Basic
earnings (loss) per share
|
60,192
|
58,083
|
59,206
|
58,688
|
|||||||||
|
Diluted
earnings (loss) per share
|
$
|
(0.08
|
)
|
$
|
0.01
|
$
|
(0.07
|
)
|
$
|
(0.22
|
)
|
||
|
Weighted
average number of shares used in computing
diluted
earnings (loss) per share
|
60,192
|
63,708
|
59,206
|
58,688
|
ALVARION
LTD.& ITS SUBSIDIARIES
DISCLOSURE
OF NON-US GAAP NET INCOME (LOSS)
FOR
COMPARATIVE PURPOSES NET INCOME (LOSS) AND EARNINGS (LOSS) PER
SHARE
EXCLUDING AMORTIZATION OF ACQUIRED INTANGIBLES, DEFERRED STOCK
COMPENSATION,
A SETTLEMENT OF A LAWSUIT AND OTHER
ACQUISITION
RELATED EXPENSES
U.S.
dollars in thousands (except per share data)
|
Three
Months Ended March 31,
|
Three
Months Ended March 31,
|
Three
Months Ended March 31
|
Year
ended December 31,
|
||||||||||
|
2006
|
2005
|
2005
|
2005
|
||||||||||
|
Net
Income (loss) according to US GAAP
|
$(4,968)
|
$
356
|
$
(3,895)
|
$(12,618)
|
|||||||||
|
Amortization
of acquired current technology, customer
relationships
and trademarks
|
1,091
|
1,094
|
1,091
|
4,367
|
|||||||||
|
Amortization
of deferred stock compensation
|
1,511
|
530
|
11
|
563
|
|||||||||
|
A
settlement of a lawsuit
|
-
|
-
|
(987
|
)
|
(987
|
)
|
|||||||
|
Acquisition
related expenses
|
-
|
868
|
-
|
868
|
|||||||||
|
Net
Income (loss) excluding amortization of intangibles and
deferred
stock compensation, a settlement of a lawsuit and acquisition
related
expenses
|
$
|
(2,366
|
)
|
$
|
2,848
|
$
|
(3,780
|
)
|
$
|
(7,807
|
)
|
||
|
Basic
net earnings (loss) per share, excluding amortization of
intangibles
and deferred stock compensation, a settlement of a lawsuit and
acquisition
related expenses
|
$
|
(0.04
|
)
|
$
|
0.05
|
$
|
(0.06
|
)
|
$
|
(0.13
|
)
|
||
|
Weighted
average number of shares used in computing
basic
net earnings (loss) per share
|
60,192
|
58,083
|
59,206
|
58,688
|
|||||||||
|
Diluted
net earnings (loss) per share, excluding amortization
of
intangibles and deferred stock compensation, a settlement of
a lawsuit and
acquisition related expenses
|
$
|
(0.04
|
)
|
$
|
0.04
|
$
|
(0.06
|
)
|
$
|
(0.13
|
)
|
||
|
Weighted
average number of shares used in computing
diluted
net earnings (loss) per share
|
60,192
|
63,708
|
59,206
|
58,688
|
|||||||||
ALVARION
LTD.& ITS SUBSIDIARIES
RECONCILIATION
BETWEEN GAAP TO NON-GAAP STATEMENT OF INCOME
U.S.
dollars in thousands (except per share data)
|
Three
Months Ended March 31, 2006
|
||||||||||
|
GAAP
|
Adjustments
|
Non-GAAP
|
||||||||
|
Sales
|
$
|
48,059
|
$
|
-
|
$
|
48,059
|
||||
|
Cost
of sales
|
26,012
|
(115
|
)(a)
|
25,897
|
||||||
|
Gross
profit
|
22,047
|
115
|
22,162
|
|||||||
|
Operating
expenses:
|
||||||||||
|
Research
and development, net
|
11,006
|
(327
|
)(a)
|
10,679
|
||||||
|
Selling
and marketing
|
12,125
|
(301
|
)(a)
|
11,824
|
||||||
|
General
and administrative
|
3,461
|
(768
|
)(a)
|
2,693
|
||||||
|
Amortization
of acquired current technology, customer relationships and
trademarks
|
1,091
|
(1,091
|
)(b)
|
-
|
||||||
|
Total
Operating expenses
|
27,683
|
(2,487
|
)
|
25,196
|
||||||
|
Operating
loss
|
(5,636
|
)
|
2,602
|
(3,034
|
)
|
|||||
|
Financial
income, net
|
668
|
-
|
668
|
|||||||
|
Net
loss
|
$
|
(4,968
|
)
|
$
|
2,602
|
$
|
(2,366
|
)
|
||
|
Basic
loss per share
|
$
|
(0.08
|
)
|
$
|
0.04
|
$
|
(0.04
|
)
|
||
|
Weighted
average number of shares used in computing basic loss per
share
|
60,192
|
60,192
|
||||||||
|
Diluted
loss per share
|
$
|
(0.08
|
)
|
$
|
0.04
|
$
|
(0.04
|
)
|
||
|
Weighted
average number of shares used in computing diluted loss per
share
|
60,192
|
60,192
|
||||||||
(a)
The effect of stock-based compensation. The Company adopted the
provisions
of Statement of Financial Accounting Standards No.
123(R),
"Share-Based Payment" on January 1, 2006 using the modified-
prospective transition method.
(b)
The
effect of amortization of intangible assets.
ALVARION
LTD.& ITS SUBSIDIARIES
Consolidated
Statements of Cash Flows
U.S.
dollars in thousands
|
Three
Months
ended
March
31, 2006
|
||||
|
Cash
flows from operating activities:
|
||||
|
Net
loss
|
$
|
(4,968
|
)
|
|
|
Adjustments
to reconcile net income to net cash used by operating
activities:
|
||||
|
Depreciation
|
1,368
|
|||
|
Amortization
of deferred stock compensation
|
1,511
|
|||
|
Amortization
of intangibles
|
1,091
|
|||
|
Increase
in trade receivables
|
(1,714
|
)
|
||
|
Decrease
in other accounts receivable and prepaid expenses
|
88
|
|||
|
Decrease
in inventories
|
5,194
|
|||
|
Decrease
in trade payables
|
(4,130
|
)
|
||
|
Decrease
in other accounts payables and accrued expenses
|
(3,232
|
)
|
||
|
Accrued
severance pay, net
|
306
|
|||
|
Net
cash used in operating activities
|
(4,486
|
)
|
||
|
Cash
flows from investing activities:
|
||||
|
Purchase
of fixed assets
|
(1,537
|
)
|
||
|
Net
cash used in investing activities
|
(1,537
|
)
|
||
|
Cash
flows from financing activities:
|
||||
|
Proceeds
from exercise of employees' stock options
|
2,847
|
|||
|
Repayment
of long term liability
|
(1,725
|
)
|
||
|
Net
cash provided by financing activities
|
1,122
|
|||
|
Decrease
in cash, cash equivalents, short-term and long-term
investments
|
(4,901
|
)
|
||
|
Cash,
cash equivalents, short-term and long-term investments at the beginning
of
the period
|
114,320
|
|||
|
Cash,
cash equivalents, short-term and long-term investments at the end
of the
period
|
$
|
109,419
|