Exhibit 99.1
AIRSPAN
NETWORKS HOLDINGS INC.
REPORTS THIRD QUARTER 2023
RESULTS
November 08, 2023 04:30 PM Eastern Standard Time
BOCA RATON, Fla.--(BUSINESS WIRE)-- Airspan Networks Holdings Inc. (NYSE American: MIMO), which provides ground-breaking, disruptive software and hardware for 5G networks, and a pioneer in end-to-end Open RAN solutions, today announced results for the third quarter ended September 30, 2023.
Third Quarter Financial Highlights
| ● | On August 11, 2023 Airspan Networks Holdings Inc. completed the previously announced sale of Mimosa Networks Inc to Radisys Corporation. The transaction resulted in a gain on the sale of $28.6 million. The proceeds from the sale provided approximately $10.5 million of cash to the Company and also reduced the Company’s indebtedness by approximately $40.0 million. |
| ● | Revenue of $14.3 million compared to $32.1 million sequentially from second quarter 2023, and from $41.1 million year-over-year from third quarter 2022. |
| ● | Gross margin of 36.7% compared to 21.0% in the second quarter 2023 and 39.8% in third quarter 2022. Excluding an inventory impairment charge of $7.2 million in second quarter 2023, the adjusted gross margin for the second quarter 2023 was 43.4% (non-GAAP measure). |
| ● | Total operating expenses of $16.1 million compared to $27.5 million in second quarter 2023, and $33.1 million for third quarter 2022. Total operating expenses for the second quarter 2023, included a $3.0 million restructuring provision, primarily related to headcount reductions. |
| ● | Net income of $9.9 million, compared to a net loss of $33.6 million in second quarter 2023, and a net loss of $23.3 million for third quarter 2022. For the third quarter 2023, net income includes a $28.6 million gain on sale of the Company’s Mimosa subsidiary. For the second quarter 2023, excluding the inventory impairment charge of $7.2 million and the restructuring provision of $3.0 million, the adjusted net loss would have been $23.4 million (non-GAAP measure). |
| ● | Adjusted EBITDA (non-GAAP measure) was a loss of $7.9 million compared to a loss of $15.2 million in second quarter 2023 and a loss of $10.0 million in third quarter 2022. For the second quarter 2023, excluding the inventory impairment of $7.2 million, the adjusted EBITDA would have been a loss of $8.0 million. |
| ● | Basic income per share was 13 cents, compared to a loss per share of 45 cents in the second quarter 2023 and a loss per share of 32 cents in the third quarter 2022. |
About Airspan
Airspan Networks Holdings Inc. (NYSE American: MIMO) is a U.S.-based provider of groundbreaking, disruptive software and hardware for 5G networks, and a pioneer in end-to-end Open RAN solutions that provide interoperability with other vendors. As a result of innovative technology and significant R&D investments to build and expand 5G solutions, Airspan believes it is well-positioned with 5G indoor and outdoor, Open RAN, private networks for enterprise customers and industrial use applications, Air To Ground, and CBRS solutions to help mobile network operators of all sizes deploy their networks of the future, today. With over one million cells shipped to 1,000 customers in more than 100 countries, Airspan has global scale. For more information, visit www.airspan.com.
Non-GAAP Measures
This news release references non-GAAP measures. Non-GAAP measures do not have a standardized meaning and are, therefore, unlikely to be comparable to similar measures presented by other companies. We reference these non-GAAP financial measures in our decision making because they provide supplemental information that facilitates consistent internal comparisons to the historical operating performance of prior periods and we believe they provide investors with greater transparency to evaluate operational activities and financial results. The presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation of, or as a substitute for, the financial information prepared and presented in accordance with US generally accepted accounting principles. Non-GAAP financial measures referred to in this report are labeled as “non-GAAP measure.”
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AIRSPAN NETWORKS HOLDINGS INC.
UNAUDITED CONDENSED consolidated BALANCE SHEETS
(in thousands, except for share data)
| September 30, 2023 | December 31, 2022 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 8,173 | $ | 7,253 | ||||
| Restricted cash | 13 | 34 | ||||||
| Accounts receivable, net of allowance of $692 and $647 at September 30, 2023 and December 31, 2022, respectively | 11,066 | 46,565 | ||||||
| Inventory | 10,197 | 18,556 | ||||||
| Prepaid expenses and other current assets | 18,343 | 17,289 | ||||||
| Total current assets | 47,792 | 89,697 | ||||||
| Property, plant and equipment, net | 5,019 | 7,351 | ||||||
| Goodwill | - | 13,641 | ||||||
| Intangible assets, net | - | 5,302 | ||||||
| Right-of-use assets, net | 3,193 | 5,697 | ||||||
| Other non-current assets | 2,961 | 3,407 | ||||||
| Total assets | $ | 58,965 | $ | 125,095 | ||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 11,081 | $ | 26,173 | ||||
| Accrued expenses and other current liabilities | 29,406 | 32,243 | ||||||
| Deferred revenue | 2,415 | 2,892 | ||||||
| Senior term loan | 41,545 | 40,529 | ||||||
| Subordinated debt | 11,540 | 11,119 | ||||||
| Subordinated term loan – related party | 44,386 | 41,528 | ||||||
| Convertible debt | 31,706 | 43,928 | ||||||
| Current portion of long-term debt | 257 | 259 | ||||||
| Total current liabilities | 172,336 | 198,671 | ||||||
| Other long-term liabilities | 4,409 | 7,223 | ||||||
| Total liabilities | 176,745 | 205,894 | ||||||
| Commitments and contingencies (Note 13) | ||||||||
| Stockholders’ deficit: | ||||||||
| Common stock, $0.0001 par value; 250,000,000 shares authorized; 74,638,893 and 74,283,026 shares issued and outstanding at both September 30, 2023 and December 31, 2022 | 7 | 7 | ||||||
| Additional paid-in capital | 778,054 | 770,427 | ||||||
| Accumulated deficit | (895,841 | ) | (851,233 | ) | ||||
| Total stockholders’ deficit | (117,780 | ) | (80,799 | ) | ||||
| Total liabilities and stockholders’ deficit | $ | 58,965 | $ | 125,095 | ||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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AIRSPAN NETWORKS HOLDINGS INC.
UNAUDITED CONDENSED consolidated STATEMENTS OF OPERATIONS
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| Revenues: | ||||||||||||||||
| Products and software licenses | $ | 11,335 | $ | 36,521 | $ | 61,120 | $ | 114,128 | ||||||||
| Maintenance, warranty and services | 2,924 | 4,573 | 10,035 | 11,475 | ||||||||||||
| Total revenues | 14,259 | 41,094 | 71,155 | 125,603 | ||||||||||||
| Cost of revenues: | ||||||||||||||||
| Products and software licenses | 8,153 | 23,462 | 45,443 | 74,747 | ||||||||||||
| Maintenance, warranty and services | 875 | 1,296 | 3,401 | 3,623 | ||||||||||||
| Total cost of revenues | 9,028 | 24,758 | 48,844 | 78,370 | ||||||||||||
| Gross profit | 5,231 | 16,336 | 22,311 | 47,233 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 9,294 | 15,003 | 36,901 | 48,244 | ||||||||||||
| Sales and marketing | 4,896 | 7,219 | 15,888 | 25,559 | ||||||||||||
| General and administrative | 1,932 | 9,644 | 15,343 | 31,891 | ||||||||||||
| Amortization of intangibles | - | 284 | 189 | 852 | ||||||||||||
| Restructuring costs | - | 944 | 3,283 | 944 | ||||||||||||
| Total operating expenses | 16,122 | 33,094 | 71,604 | 107,490 | ||||||||||||
| Loss from operations | (10,891 | ) | (16,758 | ) | (49,293 | ) | (60,257 | ) | ||||||||
| Interest expense, net | (9,944 | ) | (4,296 | ) | (19,631 | ) | (13,071 | ) | ||||||||
| Loss on extinguishment of debt | - | - | (8,281 | ) | - | |||||||||||
| Change in fair value of warrant liability and derivatives, net | 1,913 | (920 | ) | 3,143 | 3,016 | |||||||||||
| Gain on sale of Mimosa business | 28,631 | - | 28,631 | - | ||||||||||||
| Other income (expense), net | 122 | (1,177 | ) | 530 | (3,809 | ) | ||||||||||
| Income (loss) before income taxes | 9,831 | (23,151 | ) | (44,901 | ) | (74,121 | ) | |||||||||
| Income tax benefit (expense), net | 57 | (163 | ) | 293 | 52 | |||||||||||
| Net income (loss) | $ | 9,888 | $ | (23,314 | ) | $ | (44,608 | ) | $ | (74,069 | ) | |||||
| Income (loss) per share - basic | $ | 0.13 | $ | (0.32 | ) | $ | (0.60 | ) | $ | (1.02 | ) | |||||
| Income (loss) per share - diluted | $ | 0.12 | $ | (0.32 | ) | $ | (0.60 | ) | $ | (1.02 | ) | |||||
| Weighted average shares outstanding - basic | 74,605,474 | 72,572,138 | 74,554,552 | 72,415,546 | ||||||||||||
| Weighted average shares outstanding - diluted | 80,141,678 | 72,572,138 | 74,554,552 | 72,415,546 | ||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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AIRSPAN NETWORKS HOLDINGS INC.
UNAUDITED CONDENSED consolidated STATEMENTS OF CASH FLOWS
Nine Months Ended September 30, | ||||||||
| 2023 | 2022 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | (44,608 | ) | $ | (74,069 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization | 2,507 | 3,448 | ||||||
| Foreign exchange gain on long-term debt | (2 | ) | (33 | ) | ||||
| Bad debt expense | 360 | 170 | ||||||
| Change in fair value of warrants and derivatives, net | (3,143 | ) | (3,016 | ) | ||||
| Loss on extinguishment of debt | 8,281 | - | ||||||
| Non-cash debt amendment fee | - | 463 | ||||||
| Inventory impairment charge | 7,215 | - | ||||||
| Gain on sale of Mimosa business | (28,631 | ) | - | |||||
| Share-based compensation | 6,044 | 19,399 | ||||||
| Total adjustments | (7,369 | ) | 20,431 | |||||
| Changes in operating assets and liabilities: | ||||||||
| Decrease in accounts receivable | 18,755 | 15,615 | ||||||
| (Increase) decrease in inventory | (968 | ) | 1,596 | |||||
| (Increase) decrease in prepaid expenses and other current assets | (1,292 | ) | 1,571 | |||||
| Decrease in other non-current assets | 335 | 555 | ||||||
| Decrease in accounts payable | (2,188 | ) | (3,895 | ) | ||||
| (Decrease) increase in deferred revenue | (250 | ) | 651 | |||||
| (Decrease) increase in accrued expenses and other current liabilities | (2,453 | ) | 7,498 | |||||
| Increase (decrease) in other long-term liabilities | 1,499 | (7,738 | ) | |||||
| Increase in accrued interest on long-term debt | 9,165 | 8,160 | ||||||
| Net cash used in operating activities | (29,374 | ) | (29,625 | ) | ||||
| Cash flows from investing activities: | ||||||||
| Purchase of property, plant and equipment | (1,125 | ) | (2,156 | ) | ||||
| Proceeds from sale of Mimosa business | 55,188 | - | ||||||
| Net cash provided by (used in) investing activities | 54,063 | (2,156 | ) | |||||
| Cash flows from financing activities: | ||||||||
| Borrowings from senior term loan | 20,000 | - | ||||||
| Repayment of senior term loan | (24,930 | ) | (3,960 | ) | ||||
| Repayment of convertible note | (16,783 | ) | - | |||||
| Payment of debt issuance costs | (1,916 | ) | - | |||||
| Payment of taxes withheld on stock awards | (161 | ) | (73 | ) | ||||
| Net cash used in financing activities | (23,790 | ) | (4,033 | ) | ||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | 899 | (35,814 | ) | |||||
| Cash, cash equivalents and restricted cash, beginning of year | 7,287 | 63,122 | ||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 8,186 | $ | 27,308 | ||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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The following tables present the reconciliation of net income (loss), the most directly comparable GAAP measure, to Adjusted EBITDA:
| Three Months Ended | ||||||||
| ($ in thousands) | Sept. 30, 2023 | June 30, 2023 | ||||||
| Net income (loss) | $ | 9,888 | $ | (33,607 | ) | |||
| Adjusted for: | ||||||||
| Interest expense, net | 9,944 | 5,153 | ||||||
| Income tax benefit, net | (57 | ) | (154 | ) | ||||
| Depreciation and amortization | 735 | 720 | ||||||
| EBITDA | 20,510 | (27,888 | ) | |||||
| Share-based compensation expense | 2,107 | 1,998 | ||||||
| Change in fair value of warrant liability and derivatives | (1,913 | ) | (588 | ) | ||||
| Loss on extinguishment of debt | - | 8,281 | ||||||
| Gain on sale of Mimosa | (28,631 | ) | - | |||||
| Restructuring costs | - | 3,023 | ||||||
| Adjusted EBITDA | $ | (7,927 | ) | $ | (15,174 | ) | ||
| Inventory impairment charge | - | 7,215 | ||||||
| Adjusted EBITDA excluding inventory impairment charge | $ | (7,927 | ) | $ | (7,959 | ) | ||
| Three Months Ended September 30, | ||||||||
| ($ in thousands) | 2023 | 2022 | ||||||
| Net income (loss) | $ | 9,888 | $ | (23,314 | ) | |||
| Adjusted for: | ||||||||
| Interest expense, net | 9,944 | 4,296 | ||||||
| Income tax (benefit) expense, net | (57 | ) | 163 | |||||
| Depreciation and amortization | 735 | 1,173 | ||||||
| EBITDA | 20,510 | (17,682 | ) | |||||
| Share-based compensation expense | 2,107 | 5,863 | ||||||
| Change in fair value of warrant liability and derivatives | (1,913 | ) | 920 | |||||
| Loss on extinguishment of debt | - | - | ||||||
| Gain on sale of Mimosa | (28,631 | ) | - | |||||
| Restructuring costs | - | 944 | ||||||
| Adjusted EBITDA | $ | (7,927 | ) | $ | (9,955 | ) | ||
The following table presents the reconciliation of gross margin to Adjusted gross margin:
| ($ in thousands) | Three Months Ended June 30, | |||||||
| 2023 | % | |||||||
| Revenue | $ | 32,123 | 100.0 | |||||
| Cost of revenue | 25,390 | 79.0 | ||||||
| Gross margin | 6,733 | 21.0 | ||||||
| Inventory provision | 7,215 | 22.4 | ||||||
| Adjusted gross margin | $ | 13,948 | 43.4 | |||||
The following table presents the reconciliation of net loss, the most directly comparable GAAP measure, to Adjusted net loss:
| Three Months Ended | ||||
| ($ in thousands) | June 30, 2023 | |||
| Net loss | $ | (33,607 | ) | |
| Adjusted for: | ||||
| Restructuring costs | 3,023 | |||
| Inventory impairment charge | 7,215 | |||
| Adjusted net loss | $ | (23,369 | ) | |
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