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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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):
July 11, 1996
Cascade Communications Corp.
(Exact name of Registrant as specified in its charter)
Delaware 0-24578 04-3099677
(State of other jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
5 Carlisle Road
Westford, Massachusetts
(Address of principal 01886-3601
executive offices) (Zip Code)
Registrant's telephone number, including area code: (508) 692-2600
No change since last report
(Former name or former address, if changed
since last report)
TOTAL NUMBER OF SEQUENTIALLY NUMBERED PAGES: 10
EXHIBIT INDEX APPEARS ON PAGE 4
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Item 5. Other Events.
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On July 11, 1996, the Company issued a press release, a copy of which is
attached as Exhibit 99.1 to this Current Report on Form 8-K.
Item 7. Financial Statements and Exhibits.
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Exhibit No. Exhibit
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99.1 Press release of the Company
dated July 11, 1996
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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.
CASCADE COMMUNICATIONS CORP.
By: /s/ Paul E. Blondin
---------------------------------
July 11, 1996 Paul E. Blondin
Vice President Finance and
Administration, Chief
Financial Officer
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EXHIBIT INDEX
Exhibit No. Description Page
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99.1 Press release of the 6
Company dated
July 11, 1996
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EXHIBIT 99.1
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CONTACTS:
Paul E. Blondin
Chief Financial Officer
Cascade Communications Corp.
(508) 952-1001
Suzanne M. DuLong
Manager, Investor Relations
Cascade Communications Corp.
(508) 952-1552 email: [email protected]
Lucia F. Graziano
Manager, Public Relations
Cascade Communications Corp.
FOR IMMEDIATE RELEASE (508) 952-1291 email: [email protected]
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CASCADE REPORTS SECOND QUARTER REVENUES OF $80.4 MILLION
Earnings Per Share Increase 183 percent on Revenue Increase of 176 Percent
WESTFORD, MA -- JULY 11, 1996 -- Cascade Communications Corp. (NASDAQ: CSCC),
a global provider of high-performance wide area networking products for the
public carrier, Internet Service Provider (ISP) and enterprise markets today
reported results for the second quarter ended June 29, 1996. Revenue for the
quarter increased 176 percent, to $80.4 million from $29.1 million recorded for
the same period in 1995. Net income for the quarter increased to $16.7 million,
or $0.17 per share, compared with net income of $5.3 million, or $0.06 per
share, for the same period in 1995.
For the six months ended June 29, 1996, revenue increased to $136.5 million from
$52.6 million for the first six months of 1995. Net income for the period was
$27.1 million, or $0.28 per share, compared to $9.5 million, or $0.10 per share,
for the same period in 1995.
On May 30, 1996, the Company effected a two-for-one split of its Common Stock
designed to improve trading liquidity and broaden ownership of the stock. The
split was the second of 1996, and the third since the Company's initial public
offering in July, 1994, following a three-for-two split effected in February
1996 and a two-for-one split effected in June 1995. All share and per share
information has been restated to reflect the effects of the stock splits.
"Thanks to an expanding broadband packet equipment market and growing customer
acceptance of our industry-leading products, Cascade achieved significant
revenue and earnings growth during the second quarter," said Daniel E. Smith,
Cascade's president and chief executive officer. "Cascade's share of both the
Frame Relay and ATM markets has grown in part because Cascade has anticipated
industry trends and provided the solutions that support our customers' evolving
business and technical requirements. With the recent introduction of our
Channelized DS3 multiservice access module, Cascade continues to lead the
industry in cutting edge technology implementation."
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CASCADE COMMUNICATIONS CORP. Q2 1996 RESULTS/2 OF 5
Smith continued, "As a result of our acquisition of ARRIS Networks and our
evolving relationships with partners such as IBM and Motorola, Cascade looks
forward to playing an even larger role in developing and delivering world-class
networking solutions."
Recently, Cascade demonstrated its continuing commitment to standards with its
implementation of the Frame Relay Forum's newly ratified standard for T3 (45
Mbps)/E3 (34 Mbps) for Frame Relay Access. The Company also announced that it
would address the growing demand for cost-effective, higher-speed network
access, particularly among public carriers and Internet Service Providers, with
the introduction of the industry's first Channelized DS3 multiservice access
module. Cascade's Channelized DS3 module will support Frame Relay, ATM, FUNI and
SMDS and offers a ten-fold capacity increase over existing competitive offerings
allowing users to deploy 28 T1 lines on one port. MFS, UUNET Technologies, and
LDDS WorldCom are currently beta testing Cascade's Channelized DS3 module as a
solution to their customers' requirements for more flexible, more affordable,
higher-speed Internet and data services.
Reviewing the events of the quarter, in May 1996, Cascade completed its
acquisition of ARRIS Networks, a privately held developer of carrier-class
remote access technology. The acquisition was an extension of Cascade's strategy
to expand the reach of its broadband packet switching products to the edge of
the network. Cascade believes that the combined companies will be able to
achieve a superior linkage between backbone and access, thereby delivering an
overall capability currently unmatched in the industry.
Response to the Cascade 500 ATM switch remained positive during the second
quarter of commercial shipments. Bell Atlantic recently announced its intention
to use the standards-compliant Cascade 500 to support its network backbone
expansion to ATM. The Cascade 500s will work with existing Cascade B-STDX 9000
multiservice switches as a key part of the backbone technology for Bell
Atlantic's industry-leading, high-capacity global services network. Apex Global
Information Services (AGIS) and Ashton Communications also announced that that
they will scale their networks based on the Cascade 500.
Earlier in the quarter, Cascade and Motorola's Multimedia and Information
Systems Groups announced that they cooperate to provide high-speed Internet
access to end-users via cable. Motorola and Cascade will work together to
formulate industry standards for interoperability, installability and
maintainability of open systems-based solutions for high-speed Internet access
over cable.
Additionally, CRL Network Services selected Cascade's B-STDX 9000 multiservice
switches for its performance-optimized Internet backbone. Cascade's architecture
now has been implemented in a total of 18 leading Internet Service Providers.
CRL will use Cascade's products to rearchitect its network to a higher-capacity
Frame Relay-based backbone capable of meeting the explosive demand for its
commercial Internet service.
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CASCADE COMMUNICATIONS CORP. Q2 1996 RESULTS/3 OF 5
Revenue and earnings in the data networking equipment industry is subject to
fluctuation and the growth rates recently experienced by the Company do not
necessarily represent future operating results. The Company's future operating
results may fluctuate as a result of a number of factors including timing of
orders from and shipments to customers; the timing and acceptance of new product
introductions; increased competition and changes in the broadband packet
equipment market's growth rates. Investors should not use any one quarter's
results as a benchmark for future growth. For a more detailed description of the
risk factors associated with the Company and the data networking industry,
please refer to the Company's 1995 Form 10-K and First Quarter 1996 Form 10-Q.
One of the world's fastest growing data communications companies and the
price/performance leader in Frame Relay, Cascade Communications Corp. (NASDAQ:
CSCC) of Westford, Massachusetts, is a global provider of wide area networking
(WAN) products for the public carrier, ISP and enterprise markets. Cascade
delivers multiservice WAN switches and network management solutions that enable
customers to seamlessly integrate existing technologies with ATM for
cost-effective network expansion and investment protection. Cascade's B-STDX
multiservice WAN switches and the Cascade 500 ATM switch offer the highest
scalability and network capacity in the industry. Worldwide, private and public
networks such as Bell Atlantic, BellSouth, GTE, Pacific Bell, US West, LDDS
WorldCom and BT rely on Cascade products for unparalleled quality of service and
high-performance WAN services. At the heart of the Internet, Cascade switches
are deployed by leading ISPs such as PSINet, UUNET, NETCOM, AGIS (Apex Global
Information Services, Inc.), CRL Network Services and Ashton Communications.
(more)
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CASCADE COMMUNICATIONS CORP. Q2 1996 RESULTS/4 OF 5
CASCADE COMMUNICATIONS CORP.
<TABLE>
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
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JUNE 29, JULY 1, JUNE 29, JULY 1,
1996 1995 1996 1995
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<S> <C> <C> <C> <C>
Revenue $80,432 $29,109 $136,469 $52,615
Cost of revenue 28,150 10,603 47,933 19,192
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Gross profit 52,282 18,506 88,536 33,423
Operating expenses:
Research and development 12,730 4,251 21,695 7,726
Sales and marketing 9,899 4,779 18,596 8,802
General and administrative 3,739 1,610 5,960 2,788
Total operating expenses 26,368 10,640 46,251 19,316
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Income from operations 25,914 7,866 42,285 14,107
Interest income 1,217 699 2,334 1,328
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Income before income taxes 27,131 8,565 44,619 15,435
Provision for income taxes 10,445 3,298 17,498 5,943
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Net income $16,686 $ 5,267 $ 27,121 $ 9,492
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Net income per common share $ 0.17 $ 0.06 $ 0.28 $ 0.10
Weighted average number of common
and common equivalent shares outstanding 97,842 90,713 96,873 90,604
</TABLE>
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CASCADE COMMUNICATIONS CORP. Q2 1996 RESULTS/5 OF 5
CASCADE COMMUNICATIONS CORP.
<TABLE>
CONSOLIDATED BALANCE SHEETS
(in thousands)
<CAPTION>
JUNE 29, DECEMBER 31,
1996 1995
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<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 65,820 $ 55,474
Marketable securities 18,755 5,120
Accounts receivable, net 49,254 19,910
Notes receivable 1,652 1,548
Inventories 12,525 7,645
Other current assets 8,393 5,043
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Total current assets 156,399 94,740
Property and equipment, net 21,957 13,980
Other assets 2,954 3,139
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Total assets $181,310 $111,859
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities 44,068 25,553
Stockholders' equity 137,242 86,306
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Total liabilities and stockholders' equity $181,310 $111,859
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</TABLE>
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