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1 June 2007


Optium banking on 40Gb/s acquisition to boost growth

For its fiscal third-quarter 2007 (to end-April), Optium Corp of Horsham, PA, USA, which makes optical subsystems supporting core to the edge applications for telecoms and cable TV networks, has reported its eleventh consecutive quarter of revenue growth: $34.5m, up just 1% from $34.1m last quarter but more than doubling (up 110%) from $16.5m a year ago. This was despite some softness in high-end 300-pin products compared to fiscal first-half 2007.

Net income was $3.4m, compared to $3.9m last quarter and a net loss of $11.0m a year ago (although that included a charge of $11.2m for acquired in-process R&D related to the acquisition of Engana Pty Ltd - now Optium Australia).

“Our profitability continued to be strong in a quarter where we maintained our aggressive ROADM [reconfigurable optical add-drop multiplexer] production ramp to meet customer demand and encountered some product-mix-related gross margin pressure,” says chairman and CEO Eitan Gertel. “We also achieved several important strategic and operational milestones in the quarter that will further strengthen our prospects for growth.”

Optium added to its product line with the acquisition of Kailight Photonics Inc of Nes Ziona, Israel (announced at the end of March and completed in May), whose 40Gb/s product line addresses both client-side and line-side applications. “As we connect our strong base of customers to Kailight's leading technology, we are seeing a very positive response,” claims Gertel. “Customers have been particularly interested in our ability to offer module solutions that can be integrated into line-cards cost effectively,” he adds. “We expect to make our first 40Gb/s product shipments in our current fiscal fourth quarter.”

For its fiscal fourth-quarter (include Kailight operations from 16 May), Optium expects revenues of $34.5-37.5m (up slightly on fiscal Q3).

“The next several quarters are important investment and expansion periods for Optium,” says Gertel. “We are working diligently to successfully ramp our ROADM production to meet the accelerating opportunities in that market. We are also focused on a successful Kailight transition and ramping our 40Gb/s production platform to meet customer demand,” he adds.

“Our long-term view of Optium's growth potential and continued profitability is stronger than ever,” says Gertel. “We continue to target our revenue mix to the highest-growth areas of the optical market - 10Gb/s, 40Gb/s, ROADM and cable TV and fiber-to-the-home - on a disciplined and highly flexible operating model.”

See related items:

Optium completes acquisition of Kailight

Optium to acquire Kailight for 40Gb/s technologies

Optium reports 10th quarter of revenue growth, more than doubling year-on-year