UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
F5 Networks, Inc.
October 29, 2003
Washington
000-26041
91-1714307
(State or other jurisdiction
of incorporation)
(Commission
File Number)
(IRS Employer
Identification No.)
401 Elliott Avenue West
Seattle, WA 98119
Registrants telephone number, including area code 206-272-5555
Item 7. Financial Statements, Pro Forma Financial Statements and Exhibits | ||||||||
Item 12. Results of Operations and Financial Condition | ||||||||
SIGNATURES | ||||||||
INDEX TO EXHIBITS | ||||||||
EXHIBIT 99.1 |
Item 7. Financial Statements, Pro Forma Financial Statements and Exhibits
(a) | Financial Statements of Business Acquired. |
Not Applicable.
(b) | Pro Forma Financial Information. |
Not Applicable.
(c) | Exhibits: |
99.1 | Press release of F5 Networks, Inc. announcing quarterly earnings dated October 29, 2003. |
Item 12. Results of Operations and Financial Condition
On October 29, 2003, F5 Networks, Inc. issued a press release containing quarterly earnings results for the fourth quarter ended September 30, 2003. The press release is attached hereto as Exhibit 99.1.
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 hereunto duly authorized.
Dated: October 29, 2003
F5 NETWORKS, INC. | ||||
By: | /s/ John McAdam | |||
|
||||
John McAdam
Chief Executive Officer & President |
INDEX TO EXHIBITS
Exhibit Number
Description
99.1
Press release of F5 Networks, Inc. announcing quarterly
earnings dated October 29, 2003.
Exhibit 99.1
FOR IMMEDIATE RELEASE
CONTACT: |
Investor Relations
John Eldridge (206) 272-6571 j.eldridge@f5.com |
|||
Public Relations
Alane Moran (206) 272-6850 a.moran@f5.com |
F5 Networks Announces Fourth Quarter and Fiscal 2003 Earnings
Quarterly revenue up 8 percent from prior quarter and 17 percent year-over-year
reflects continued strengthening of the companys core business
SEATTLE, WA October 29, 2003 F5 Networks, Inc. (NASDAQ: FFIV) today announced net revenue of $31.6 million for the fourth quarter of fiscal 2003, up 8 percent from $29.2 million in the prior quarter and 17 percent from $27.1 million in the fourth quarter of fiscal 2002. Fourth quarter net income was $1.4 million ($0.05 per share) compared to net income of $1.4 million ($0.05 per share) in the third quarter and a net loss of $423,000 ($0.02 per share) in the fourth quarter a year ago. Both net revenue and income for the quarter exceeded the target ranges ($0.02 to $0.03 per share on revenue of $29.5 million to $30.5 million) set by management in the companys July 23rd earnings release.
For fiscal 2003, the company had net income of $4.1 million ($0.14 per diluted share) on record annual net revenue of $115.9 million compared to a fiscal 2002 net loss of $8.6 million ($0.34 per share) on net revenue of $108.3 million.
F5 president and chief executive officer John McAdam said the companys top-line growth was a result of continued strengthening in its core business, augmented by initial sales of its recently acquired FirePass SSL VPN products. During the quarter, overall product and service revenue grew 8 percent and 9 percent respectively from the prior quarter, while gross margin held steady at 77 percent of revenue. Sales were up across all product categories, with systems and software representing 68 percent and 5 percent of revenue respectively. Switch sales represented 67 percent of systems revenue.
On a regional basis, McAdam said Japan and North America drove the companys net revenue growth in Q4. Japanese sales rebounded from the seasonally slow June quarter that marks the beginning of Japans fiscal year. In North America, we continued to see the strengthening in product sales and service revenue that has characterized the last two quarters.
F5 Networks Announces Fourth Quarter and Fiscal 2003 Earnings
A key factor in the strong growth of North American sales was the increasing contribution of our sales channels. In addition, our focus on major accounts and our investments in our iControl partnership program also continued to pay dividends. Sales to new and existing major accounts were up sequentially in dollars and as a percent of total revenue in Q4. Sales involving one or more iControl partners principally Microsoft, BEA, Oracle, and IBM (Websphere) were also up sequentially and represented a growing percentage of quarterly revenue, McAdam said.
Along with its strong operating results, the companys balance sheet continued to improve during the fourth quarter. After spending $27.4 million to acquire substantially all of the assets of uRoam in July, F5 ended the year with $79 million in cash, cash equivalents and investments. Operating cash flow of $5.6 million in Q4 reflected days sales outstanding (DSOs) of 55 days.
Based on the companys strong Q4 results and the strength of the current sales pipeline, McAdam said he expects to see continued revenue growth in the first quarter of fiscal 2004 and into the next calendar year. For the first quarter of fiscal 2004, ending December 31, 2003, McAdam said the company has set a net revenue target of $32 million to $34 million, with net income in the range of $0.06 to $0.08 per share.
About F5 Networks
F5 Networks keeps IP-based traffic flowing and business information always available to any user from any device, anywhere in the world. Our products ensure secure and reliable access to servers and the applications that run on them. F5 also provides tools to automate communications between applications and the network, eliminating tedious, manual processes.
As the pioneers of intelligent load balancing, F5s continued innovations help businesses optimize and protect their IT investments. Our mission is to ensure the availability, scalability, performance, and security of IT resources that enterprises require to successfully do business. The company is headquartered in Seattle, Washington with offices worldwide. For more information go to http://www.f5.com.
Forward Looking Statements
Statements in this press release concerning the revenue, earnings and net income targets for the first quarter of fiscal 2004 and other statements that are not historical facts are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of F5, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-
F5 Networks Announces Fourth Quarter and Fiscal 2003 Earnings
looking statements. Such factors include, among others: the successful integration of uRoams products with F5s products, the timely development, introduction and acceptance of additional new products and features by F5 or its competitors; competitive pricing pressures; increased sales discounts; F5s ability to sustain or develop distribution relationships; F5s ability to attract, train and retain qualified product development, marketing, sales, professional services and customer support personnel; F5s ability to expand in the international markets and the unpredictability of F5s sales cycle. F5 has no duty to update any guidance provided. More information about potential risk factors that could affect F5s business and financial results is included in F5s annual report on Form 10-K for the fiscal year ended September 30, 2002, and other public filings with the Securities and Exchange Commission.
# # # #
F5 Networks, Inc.
Consolidated Balance Sheets
(in thousands)
September 30,
September 30,
2003
2002
Current assets:
$
10,351
$
20,801
34,527
59,532
19,325
20,404
762
349
4,779
4,713
69,744
105,799
6,000
6,000
10,079
12,211
34,132
1,346
24,188
4,030
933
$
148,173
$
126,289
Current liabilities:
$
3,714
$
3,685
13,148
13,546
19,147
14,058
36,009
31,289
1,584
1,315
151
1,735
1,315
141,709
128,876
(10
)
(93
)
195
454
(31,465
)
(35,552
)
110,429
93,685
$
148,173
$
126,289
F5 Networks, Inc.
Consolidated Statements of Operations
(in thousands, except per share amounts)
Three months ended
Twelve months ended
September 30,
September 30,
2003
2002
2003
2002
$
23,048
$
20,376
$
84,197
$
82,566
8,585
6,699
31,698
25,700
31,633
27,075
$
115,895
108,266
5,086
4,046
17,837
20,241
2,342
2,360
9,068
10,238
7,428
6,406
26,905
30,479
24,205
20,669
88,990
77,787
14,045
13,062
53,458
50,581
5,155
4,312
19,246
17,985
2,964
3,427
12,014
15,045
503
3,274
6
90
83
443
22,170
21,394
84,801
87,328
2,035
(725
)
4,189
(9,541
)
(375
)
355
751
1,420
1,660
(370
)
4,940
(8,121
)
307
53
853
489
$
1,353
$
(423
)
$
4,087
$
(8,610
)
$
0.05
$
(0.02
)
$
0.15
$
(0.34
)
27,125
25,670
26,453
25,323
$
0.05
$
(0.02
)
$
0.14
$
(0.34
)
29,521
25,670
28,220
25,323