Oct. 22, 2009 (PR Newswire) -- SAN JOSE, Calif., Oct. 22 /PRNewswire-FirstCall/ -- Oclaro, Inc. (Nasdaq: OCLR), a leading provider of optical components, modules and subsystems, today announced the financial results for its first quarter of fiscal 2010, which ended September 26, 2009.

"In the first full quarter after our merger with Avanex we have generated positive non-GAAP operating profit. We're quite proud of this accomplishment," said Alain Couder, President and CEO of Oclaro, Inc. "This was driven by increasing revenues and improving our gross margins to 26%. As a result, Oclaro was cash flow positive in the September quarter, excluding $6.5 million of net deal related expenditures."

Highlights For First Quarter Fiscal 2010:

--  GAAP revenues were $85.1 million for the first quarter of fiscal 2010,
compared to $66.9 million in the fourth quarter of fiscal 2009.
--  GAAP revenues for the fourth quarter of fiscal 2009 exclude revenues
from the Company's New Focus business of $5.1 million.  As a result
of the July 4, 2009 transfer of the New Focus business to Newport
Corporation in exchange for their Spectra-Physics laser diode
business and $3.0 million in cash, the historical results of New
Focus are presented as discontinued operations in the GAAP financial
statements.
--  GAAP gross margin was 26% for the first quarter of fiscal 2010, compared
to 25% in the fourth quarter of fiscal 2009, which included only two
months of Avanex Corporation results.
--  Non-GAAP revenues were $85.1 million for the first quarter of fiscal
2010, compared to $72.0 million for the fourth quarter of fiscal 2009,
which included only two months of revenues of Avanex Corporation.
--  Non-GAAP revenues for the fourth quarter of fiscal 2009 would have
been $78.1 million including all three months of Avanex's revenues.
--  Non-GAAP revenues include the revenues of New Focus, which is
treated as a discontinued operation in our GAAP financial
statements.
--  A reconciliation table of non-GAAP measures to the most comparable
GAAP measures is included in the financial tables section of this
release and further discussion of these measures is also included
later in this release.
--  Non-GAAP gross margin was 26% for the first quarter of fiscal 2010,
compared to 25% for the fourth quarter of fiscal 2009.
--  Non-GAAP gross margin for the fourth quarter of fiscal 2009 would
have been approximately 21% had we included the results of Avanex
for the entire quarter and excluded certain non-recurring credits.
--  Non-GAAP gross margin excludes $0.2 million of stock-based
compensation in the first quarter of fiscal 2010 and $0.3 million in
the fourth quarter of fiscal 2009.
--  Non-GAAP operating income was $1.3 million for the first quarter of
fiscal 2010, compared to a non-GAAP operating loss of $2.0 million in
the fourth quarter of fiscal 2009.
--  Adjusted EBITDA was positive $3.8 million for the first quarter of
fiscal 2010, compared to positive $0.7 million in the fourth quarter of
fiscal 2009.
--  GAAP net loss for the first quarter of fiscal 2010 was $0.5 million,
compared to a GAAP net loss of $14.6 million in the fourth quarter of
fiscal 2009.
--  Cash, cash equivalents, restricted cash and short-term investments were
$52.5 million as of September 26, 2009 compared to $58.0 million at the
end of the prior quarter.

--  On September 30, 2009, Oclaro regained compliance with NASDAQ listing
rule 5450(a)(1) based on the closing price of its common stock exceeding
$1.00 for at least 10 consecutive business days.

Second Quarter Fiscal 2010 Outlook

"Revenues were up, we are moving beyond the integration phase of Oclaro, and we still have more synergies to come," said Mr. Couder. "While visibility still remains fairly short term, our pipeline suggests the extent of our December revenue growth opportunities may be supply constrained, which is reflected in our guidance range. Regardless, by delivering on this guidance we believe we have a reasonable chance of generating cash in the December quarter."

The results of Oclaro, Inc. for the second quarter of fiscal 2010, which ends January 2, 2010, are expected to be:

--  Revenues in the range of $87 million to $92 million.
--  Non-GAAP gross margin in the range of 25% to 28%.

--  Adjusted EBITDA in the range of $3.0 million to $7.0 million.

The second quarter of fiscal 2010 will include 14 weeks of operations, compared to 13 weeks for the first quarter of fiscal 2010, due to the Company's fiscal year calendar. Our second quarter guidance includes the effects of the additional week on our results of operations.

The foregoing guidance is based on current expectations. These statements are forward looking, and actual results may differ materially. Please see the Safe Harbor Statement in this earnings release for a description of certain important risk factors that could cause actual results to differ, and refer to Oclaro, Inc.'s most recent annual and quarterly reports on file with the Securities and Exchange Commission (SEC) for a more complete description of the risks. Furthermore, our outlook excludes items that may be required by GAAP, including, but not limited to, restructuring and related costs, acquisition or disposal related costs, expenses or income from certain legal actions, settlements and related costs outside our normal course of business, impairments of other long-lived assets, depreciation and amortization, extraordinary items, as well as the expensing of stock options and restricted stock grants.

Conference Call

Oclaro will hold a conference call to discuss financial results for the first quarter of fiscal 2010 today at 1:30 p.m. PT/4:30 p.m. ET. To listen to the live conference call, please dial (480) 629-9665. A replay of the conference call will be available through October 29, 2009. To access the replay, dial (303) 590-3030. The conference code for the replay is 4170717. A webcast of this call will be available in the investors section of Oclaro's website at www.oclaro.com.

About Oclaro

Oclaro, Inc., with headquarters in San Jose, California, is a tier 1 provider of high performance optical components, modules and subsystems to the telecommunications market, and is one of the largest providers to metro and long haul network applications. The Company, formed on April, 27, 2009, following the combination of Bookham, Inc. and Avanex Corporation, leverages proprietary core technologies and vertically integrated product development to provide its customers with cost-effective and innovative optical devices, modules and subsystems. The company serves a broad customer base, combining in-house and outsourced manufacturing to maximize flexibility and drive improved gross margin. Its photonic technologies also serve selected high growth markets, including industrial, defense, life sciences, medical and scientific, with diversification providing both significant revenue streams and strategic technological advantage. Oclaro is a global company, with cutting edge chip fabrication facilities in the UK, Switzerland and Italy, and in Tucson, Arizona during the transition of related activities to Europe, and manufacturing sites in the US, Thailand and China.

Oclaro and all other Oclaro product names and slogans are trademarks or registered trademarks of Oclaro, Inc. in the USA or other countries. Spectra-Physics is a registered trademark of Newport Corporation.

Safe Harbor Statement

This press release and the statements made by management contain statements about management's future expectations, plans or prospects of Oclaro, Inc. and its business, and the assumptions underlying these statements, constitute forward-looking statements for the purposes of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements concerning (i) financial targets, including financial targets related to gross margin; research and development expenses; sales, general and administrative expenses and non-GAAP operating margin, (ii) financial guidance for the fiscal quarter ending January 2, 2010, including guidance regarding revenue, non-GAAP gross margin and adjusted EBITDA, (iii) the impact of the acquisition of Avanex Corporation and the Spectra-Physics asset swap on the combined entity's gross margin, (iv) sources for improvement of gross margin and operating expenses, including supply chain synergies, optimizing mix of product offerings, transition to higher margin product offerings, benefits of combined R&D and sales organizations and single public company costs, including statements regarding the expectation of further synergies, (v) opportunities to grow in adjacent markets and (vi) statements containing the words "target," "believe," "plan," "anticipate," "expect," "estimate," "will," "should," "ongoing," and similar expressions. There are a number of important factors that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including the impact of continued uncertainty in world financial markets and the resulting reduction in demand for our products, the future performance of Oclaro, Inc.