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EXHIBIT 99.2
FOR IMMEDIATE RELEASE
MRV ANNOUNCES 2ND QUARTER RESULTS, AND THE ACQUISITION OF ASTROTERRA
CORPORATION
Unification of Optical Wireless Activities to Take Place Under Newly Formed
Optical Access, Inc.
Chatsworth - California - July 27, 2000 - MRV Communications, Inc. (Nasdaq:
MRVC) today announced closing the acquisition of AstroTerra Corporation, a
pioneer in the development of free-space optical wireless technology. This
acquisition, together with the acquisition of JOLT, announced earlier this year,
propels Optical Access, Inc. into a premier position as the leading supplier of
optical wireless solutions.
Newly formed Optical Access, Inc. develops, manufactures and markets optical
wireless systems that enable a fundamental shift in the design of the access
network. The company's products create an unconstrained optically meshed
networks with intelligent switching, provisioning and aggregation Features.
Together with its WDM fiber solutions, Optical Access eliminates the bottleneck
between the user's premises and the backbone network. This allows a provider to
bypass the incumbent carrier's copper access network, to quickly and
cost-effectively establish enhanced high-speed broadband services. The Optical
Access solutions enable faster deployment and increased bandwidth over competing
solutions. The company's switched meshed architecture and redundant features
provide service availability in all weather conditions.
AstroTerra Corporation was founded in 1992 and quickly established itself as the
recognized leader in the high-speed optical wireless communications field. The
company's strong intellectual property includes patented technology that uses
multiple transmit apertures to avoid atmospheric scintillation fade. This allows
wireless optical transmission up to 5 kilometers. In partnership with Lucent
Technologies, AstroTerra was the first to demonstrate a working laser
communication system capable of transferring data at rates of 2.5 Gbps over a
range of 2.4 kilometers. AstroTerra's new TerraLink Fusion systems combine an
optical communication link with an automatic radio frequency back-up to provide
100% wireless availability, even in the worst weather conditions.
AstroTerra has shown great success in developing high-speed satellite laser
communications technology, most notably with the Ballistic Missile Defense
Organization and US Army Space and Missile Defense Command. The Space Technology
Research Vehicle -2 (STRV-2) is the first satellite-to-ground experiment capable
of transmitting information at Gigabit speeds over a distance of two thousand
kilometers.
Dr. Eric Korevaar, president of AstroTerra, commented: "We are very excited to
join forces with an innovative, forward-thinking company like MRV
Communications. Combining our expertise in optical wireless
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technology with the comprehensive solution that Optical Access offers represents
a strong step forward in bringing ultra high-speed wireless solutions to the
last-mile telecommunications arena."
Noam Lotan, President & CEO of MRV commented: "Acquiring AstroTerra Corporation
establishes Optical Access as the leader in optical wireless technology. This
technology is poised to make a strong impact on the last mile broadband access.
Wireless access is cheaper and faster to install than fiber and can deliver the
high bandwidth that users require. With our robust product line, the experience
of thousands of optical wireless installations, and substantial ownership of
intellectual property, MRV stands to capitalize on the emerging opportunities in
this field. We intend to file for an Initial Public Offering of Optical Access
within 90 days."
Separately, MRV announced closing the acquisitions of Optronics International
Corporation ("OIC") and Quantum Optech Inc. ("QOI"), now part of Luminent, Inc.
Organizational changes in Management
The following changes took place in the management of Luminent, Inc. Dr. William
R. Spivey, former President of the Network Products group of Lucent
Technologies, was appointed President, Chief Executive Officer and Director of
Luminent. Eric Blachno, former Managing Director of Research and a Financial
Analyst for PMG, was appointed Vice President of Finance and Chief Financial
Officer of Luminent. Khalid (Ken) Ahmad resigned his position as General Manager
of Luminent and in so doing, is no longer an officer at MRV. Dr. Mark Heimbuch,
was appointed Vice President and Chief Technology Officer of Luminent. In
addition, Dan Avida, former Chairman and CEO of Electronics for Imaging, Richard
S. Hill, Chairman and CEO of Novellus Systems, and Amos Wilnai, Chairman of MMC
Networks, joined the newly formed Board of Directors of Luminent.
The following changes in management took place at MRV and its subsidiaries. At
iTouch Communications, Philippe Szwarc was appointed Chief Executive Officer,
Mary Jane Gruninger was appointed Executive Vice President of Research and
Development and Engineering, and Francois-Henri Worm, Founder of CES, was
appointed Chief Technology Officer. Ofer Iny, Vice President of Engineering at
Zuma Networks, is no longer an officer of MRV. In addition, Guy Avidan will head
Optical Access, Inc.
Financials
Revenues for the quarter were $73,935,000, up from $73,251,000 in the second
quarter of 1999. Including non-recurring charges, net loss for the second
quarter of 2000 was $27,750,000 compared to net income of $525,000 in the
quarter ended June 30, 1999. Including non-recurring charges, basic and diluted
loss per share for the second quarter of 2000 were $0.44 compared to basic and
diluted earnings per share of $0.01 in the second quarter of 1999. Excluding
non-recurring charges, basic and diluted earnings per share for the second
quarter of 2000 were $0.02 compared to basic earnings per share of
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$0.08 and diluted earnings per share of $0.07 in the second quarter of 1999.
Revenues for the six months ended June 30, 2000 were $ $139,007,000 compared to
$143,367,000 for the corresponding six month period in 1999. Including
non-recurring charges, net loss for the six months ended June 30, 2000 was
$33,614,000 compared to a net loss of $384,000 for the corresponding period in
1999. Excluding non-recurring charges, net income for the six months ended June
30, 2000 was $1,502,000 compared to net income of $6,488,000 for the
corresponding period in 1999. Including non-recurring charges, basic and diluted
losses per share for the six months ended June 30, 2000 were $0.56 compared to
basic and diluted losses per share of $0.01, for the six months ended June 30,
1999. Excluding non-recurring charges, basic earnings per share were $0.03 and
diluted earnings per share were $0.02 for the six months ended June 30, 2000,
compared to basic and diluted earnings per share of $0.12, for the six months
ended June 30, 1999.
All historical amounts reflected in these financial results have been adjusted
for the 2 for one stock split that took place in May 2000.
About MRV Communications, Inc.
MRV Communications is a world-class leader in optical network components and
systems. The company has leveraged its early leadership in fiber optic
transmission into a well-focused range of solutions, integrating switching,
routing, access servers and optical transmission systems.
As the Internet evolves into a single global communication network, MRV has
launched the development of new technologies to drive the next-generation
infrastructures. Such developments encompass optical access systems,
subscribers' management systems and Linux-based solutions.
MRV has initiated and funded cutting-edge start-up companies including Zaffire
(formerly known as New Access Communications), Charlotte's Networks,
Hyperchannel, Zuma Networks and most recently RedC Optical Networks. MRV's web
site is located at http://www.mrv.com.
This release may contain forward-looking statements that involve risks and
uncertainties. These statements may differ materially from actual future events
or results. Readers are referred to the documents filed by MRV with the
Securities and Exchange Commission, specifically the most recent reports on
Forms 10K and 10Q, which identify important risk factors that could cause actual
results to differ from those contained in the forward-looking statements,
including potential fluctuations in operating results, dependence on new product
developments, rapid technological and market changes, manufacturing risks,
volatility of the company's stock price, financial risk management, and future
growth subject to risks. The announcement of the anticipated filing of any
registration statements contained herein does not constitute an offer of any
securities for sale.
CONTACT: MRV Communications Inc.
Diana Hayden, 818/886-6782, Investor Relations
[email protected]
MRV Communications, Inc.
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MRV COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS)
<TABLE>
<CAPTION>
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June 30, December 31,
2000 1999
(unaudited) (audited)
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<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash & cash equivalents $ 45,207 $ 34,330
Short-term investments 3,427 10,141
Accounts receivable 63,555 60,637
Inventories (Including Contract in Progress of
$1,682 in 2000) 49,616 35,392
Refundable Income Taxes -- 3,216
Deferred income taxes 7,663 6,907
Other current assets 5,872 6,336
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Total current assets 175,340 156,959
PROPERTY AND EQUIPMENT - At cost, net of depreciation
and amortization 48,497 19,600
OTHER ASSETS:
Goodwill & Intangibles 321,764 27,214
Deferred compensation 40,795 --
U.S. Treasury notes 95,014 97,704
Investments in Partner Companies 29,969 4,232
Deferred income taxes 6,827 5,324
Loan financing costs and other 6,655 3,500
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$724,861 $314,533
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Current maturities of financing lease obligations $ 1,097 $ 198
Accounts payable 33,485 33,455
Accrued liabilities 21,744 15,403
Short term debt 78,801 --
Deferred revenue 1,293 1,478
Income taxes payable 714 --
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Total current liabilities 137,134 50,534
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LONG-TERM LIABILITIES
Convertible debentures 90,000 90,000
Capital lease obligations, net of current portion 1,589 1,481
Deferred income taxes 1,213 281
Other long-term liabilities 10,152 2,647
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Total long term liabilities 102,954 94,409
MINORITY INTERESTS 2,599 2,775
STOCKHOLDERS' EQUITY: 482,174 166,815
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$724,861 $314,533
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MRV COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
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<CAPTION>
Six Months Ended, Three Months Ended
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June 30, June 30, June 30, June 30,
2000 1999 2000 1999
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(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
REVENUES, net $ 139,007 $ 143,367 $ 73,935 $ 73,251
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COSTS AND EXPENSES:
Cost of goods sold 88,529 93,961 45,793 47,595
Research and development expenses 13,367 12,098 7,307 5,969
Research and development expenses of
consolidated development stage enterprises 13,282 4,939 7,451 2,603
Selling, general and administrative expenses 41,481 29,804 26,467 14,750
Amortization of goodwill and intangibles from acquisitions 13,069 1,933 12,055 1,142
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Operating (loss) income (30,721) 632 (25,138) 1,192
Interest expense related to convertible notes 2,803 2,250 1,678 1,125
Other income, net (1) 1,125 2,660 488 1,257
Provision for income taxes 883 1,409 1,377 782
Minority interests 332 17 45 17
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NET INCOME (LOSS) $ (33,614) $ (384) $ (27,750) $ 525
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NET INCOME (LOSS) PER SHARE - BASIC $ (0.56) $ (0.01) $ (0.44) $ 0.01
NET INCOME (LOSS) PER SHARE - DILUTED $ (0.56) $ (0.01) $ (0.44) $ 0.01
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SHARES USED IN PER - SHARE CALCULATION - BASIC 59,839 53,358 62,754 53,472
SHARES USED IN PER - SHARE CALCULATION - DILUTED 59,839 53,358 62,754 57,621
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(1) Includes cost of unconsolidated development stage
enterprises of $1,437 and $951 for the six and
three months ended June 30, 2000
SUPPLEMENTAL PRO FORMA INFORMATION (UNAUDITED)
AMORTIZATION OF INTANGIBLES FROM ACQUISITIONS,
net of tax effects 13,069 1,933 12,055 1,142
DEFERRED COMPENSATION EXPENSE, net of tax effects 7,328 -- 7,328 --
DEVELOPMENT STAGE ENTERPRISES, net of tax effects 14,719 4,939 9,565 2,603
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NET INCOME BEFORE AMORTIZATION OF ACQUISITION INTANGIBLES AND
RECOGNIZED DEVELOPMENT STAGE ENTERPRISE COSTS $ 1,502 $ 6,488 $ 1,198 $ 4,270
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EARNINGS PER SHARE BEFORE AMORTIZATION OF ACQUISITION
INTANGIBLES AND RECOGNIZED DEVELOPMENT STAGE ENTERPRISE
COSTS - BASIC $ 0.03 $ 0.12 $ 0.02 $ 0.08
EARNINGS PER SHARE BEFORE AMORTIZATION OF ACQUISITION
INTANGIBLES AND RECOGNIZED DEVELOPMENT STAGE ENTERPRISE
COSTS - DILUTED $ 0.02 $ 0.12 $ 0.02 $ 0.07
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SHARES USED IN PER - SHARE CALCULATION - BASIC 59,839 53,358 62,754 53,472
SHARES USED IN PER - SHARE CALCULATION - DILUTED 66,767 56,391 68,925 58,326
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