ARRIS Group Inc Q3 2009 Earnings Call Transcript

ARRIS Group, Inc. (ARRS) Q3 2009 Earnings Call October 26, 2009; 5:00 pm ET Executives Bob Stanzione - Chairman & Chief Executive Officer Dave Potts - Executive Vice President, Chief Financial Officer Bruce McClellend - President of Broadband Communications Jim Lakin - President of Advance Technologies Jim Bauer - Vice President of Investor Relations Analysts James Kissner - Jefferies & Co. Johanna - RBC Capital Markets Greg Mesniaeff - Needham & Co. Blair King - Avondale Partners Simon Leopold - Morgan, Keegan & Co. Larry Harris - CL King & Associates Incorporated Shubho Ghosh - Thomas Partners John Marchetti - Cowen & Co. Ari Bensinger - Standard & Poor’s Brian Coyne - Wedge Partners Presentation Operator Good day, ladies and gentlemen and welcome to the quarter three 2009 ARRIS Group Inc. earnings conference call. My name is Veronica and I will be your operator for today. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session. (Operator instructions) I would now like to turn the conference over to your host for today, Mr. Jim Bauer, Vice President of Investor Relations. Please proceed. Jim Bauer Thank you Veronica and welcome to all to the ARRIS conference call with management. This afternoon we’ll discuss our third quarter 2009 financial results, which we released after the close of markets today. We’ll be using a series of slides during our webcast which were also on the ARRIS website in the Investor Relations section. With us here at the ARRIS headquarters are Bob Stanzione, ARRIS Chairman and CEO; Dave Potts, Executive Vice President an...
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ARRIS and Comcast Spotlight Team to Provide Advertising Sales Capabilities with Multichannel Programming Providers

SUWANEE, Ga., Oct. 27 /PRNewswire-FirstCall/ -- ARRIS (Nasdaq: ARRS - News) and Comcast Spotlight, the advertising sales division of Comcast, today announced the launch of an advertising platform using the ARRIS ConvergeMedia Virtual Interconnect (VIC) advertising solution. Using the ARRIS VIC, Spotlight can efficiently and reliably process ad schedules, verifications and ad copy from multiple providers, markets and time zones for network programming feeds. The Virtual Interconnect (VIC) is part of the advertising solution family in the ConvergeMedia Advertising platform. VIC helps affiliates maximize their advertising revenues, simplify ad operations and strengthen relationships with ad and media sources. VIC automatically merges schedules from multiple traffic and billing systems, using pre-defined business rules to resolve and manage schedule conflicts. High level and detailed monitoring tools allow for rapid trouble-shooting and system analysis. Real time access to reports allows for secure and effective delivery services for the operators, programmers and the ad agencies.The solution creates the industry's first automated SCTE 130 Web Service Advertising platform. The implementation of the standard communication protocols allows open interaction between the different service providers, campaign services, markets and buy processes, enabling a tighter integration between all parties."With the growth of more programming and more markets, the need to efficiently and effectively manage many advert...
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ARRIS Bundles Ad Splicing Feature into VIPr Transcoder

SUWANEE, Ga., Oct. 27 /PRNewswire-FirstCall/ -- ARRIS (Nasdaq: ARRS - News) today announced the addition of ad splicing capability to the ARRIS EGT VIPr Transcoder product line. The VIPr now has the capability to dynamically insert advertisements into broadcast programming in accordance with the SCTE 30 and 35 specifications. While ad-splicing has been available to the cable industry for some time, ARRIS 'intelligent recode' is unique for several reasons: Current rate-shapers typically have limitations on the amount of bit rate reduction before causing video degradation. The ARRIS VIPr does not suffer from such high bit-rate video limitations. It can routinely process high bit-rate video while preserving the best possible video quality for both the program content and the actual ads being spliced.'Intelligent Recode' appeals to advertisers because it ensures maintenance of high video quality as programming transitions between ads and show content. To accomplish this, the VIPr products perform full decoding and re-coding of video content with adaptive video parameter re-use onboard in a single device - thereby eliminating operators' need for an additional rate-shaper box."ARRIS' VIPr ad-splicing feature ups the ante over previous generations of ad splicing technologies currently on the market," said Bruce McClelland, President, Broadband Communications Group for ARRIS. "The ARRIS Intelligent Recode feature can provide noticeably superior video quality during ad transitions, which is a si...
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New Three-Tuner Moxi(R) HD DVR and Reduced Pricing for Moxi Multi-Room Packages Unwrapped for Holiday Season

SUWANEE, Ga., Nov. 10 /PRNewswire-FirstCall/ -- As part of its first product update since acquiring the award-winning Moxi product line from Digeo, Inc. in September, ARRIS (Nasdaq: ARRS - News) today announced the introduction of a three-tuner version of the Moxi HD DVR as well as reduced pricing for its two-tuner Moxi HD DVR and Moxi multi-room packages. The company also announced plans to deliver live TV on the Moxi Mate via the Moxi HD DVR. The Moxi HD DVR will receive the update automatically through a software download. Additionally, the price of the Moxi Mate has been reduced to $299 (formerly $399)."We've heard from consumers that they love the Moxi products but are looking for different price and component options to serve their individual needs," said Marc Beckwitt, VP of CPE Video Business Development, ARRIS. "The recent acquisition by ARRIS brings the market presence and leverage required to drive cost out of the product, and consequently, we're able to offer these very competitive prices to consumers."ARRIS continues to stand by the commitment to deliver the Moxi "all in", with no monthly or lifetime DVR service fees. Moxi also has no in-menu advertisements.The Moxi HD DVR is designed to appeal to the most demanding digital cable entertainment enthusiasts. Some of its key attributes include:The Moxi HD DVR makes it effortless for consumers to discover, experience and share high definition media from their digital cable provider, PCs on the home network, and the Internet....
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ARRIS GROUP INC Files SEC form 10-Q, Quarterly Report

Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Overview We are a global communications technology company specializing in the design and engineering of broadband network solutions. We are a leading developer, manufacturer and supplier of cable telephony, video and high-speed data products, as well as outside plant construction and maintenance equipment for cable system operators. We provide products and equipment principally to cable system operators and, more specifically, to Multiple System Operators ("MSOs"). Our products allow MSOs and other broadband service providers to deliver a full range of integrated voice, video and high-speed data services to their subscribers. Our core strategy is to lead network operators through the transition to Internet Protocol-based networks by leveraging our extensive global installed base of products and experienced workforce to deliver network solutions that meet the business needs of our customers. We operate our business in three segments: • Broadband Communications Systems ("BCS") • Access, Transport & Supplies ("ATS") • Media & Communications Systems ("MCS") A detailed description of each segment is contained in "Our Principal Products" in our Form 10-K for the year ended December 31, 2008. Our Strategy and Key Highlights Our long-term business strategy, "Convergence Enabled," includes the following key elements: • Maintain a strong capital structure, mindful of our 2013 debt maturity, share repurchase opportunities and other capital needs including mergers and acquisitions. • Grow our current business into a more complete portfolio including a strong video product suite. • Continue to invest in the evolution toward enabling true network convergence onto an all IP platform. • Continue to expand our product/service portfolio through internal developm...
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ARRIS to Present at Second Annual Needham Broadband TechDay

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ARRIS Demonstrates Advanced Addressable Advertising Services at the CableLabs(R) November Advertising Interop

SUWANEE, Ga., Nov. 17 /PRNewswire-FirstCall/ -- ARRIS (Nasdaq: ARRS - News), a global communications technology company providing voice, data and video solutions, today announced that it has successfully concluded a series of Advanced Advertising use cases at the CableLabs® Advanced Advertising Interop last week. The demonstrations included Dynamic Video On Demand (VOD) Ad Insertion using audience qualifiers, Dynamic Addressable linear advertising, Interactive Telescoping Advertisements and Interactive TV (ITV) using the EBIF standard. Leveraging the SCTE130 standard, ARRIS worked with several industry collaborators to deliver 4 use cases requested by CableLabs. The companies with which ARRIS has completed interoperability demonstrations for these tests included BlackArrow, FourthWall Media, OpenTV, Sigma Systems, This Technology and UniSoft.The introduction of SCTE 130 and EBIF reflects the maturation of advanced advertising as a new revenue source for the cable industry. Standards-based interfaces serve to accelerate time to market of complex disparate solution components and introduce enhanced and interactive advertising revenue streams. Standards like SCTE130 allow uniform adoption of the technologies across operators' networks, simplifying their operations, reducing CAPEX and improve revenues."We are very excited to be able to bring these addressable advertising solutions to the industry," said Joe Matarese, Vice President and General Manager of the ARRIS On Demand Systems Division. "Leveraging open ...
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ARRIS GROUP INC Financials

PERIOD ENDING30-Sep-0930-Jun-0931-Mar-0931-Dec-08Total Revenue275,772  278,521  253,518  292,398  Cost of Revenue160,299  161,241  158,008  183,535  Gross Profit115,473  117,280  95,510  108,863  Operating ExpensesResearch Development30,909  30,143  28,395  29,285  Selling General and Administrative36,311  39,128  35,343  36,957  Non Recurring73  592  120  209,726  Others9,281  9,263  9,263  9,341  Total Operating Expenses76,574  79,126  73,121  285,309  Operating Income or Loss38,899  38,154  22,389  (176,446)Income from Continuing OperationsTotal Other Income/Expenses Net(189)(173)3,384  1,990  Earnings Before Interest And Taxes38,710  37,981  25,773  (174,456)Interest Expense4,356  4,278  4,487  1,776  Income Before Tax34,354  33,703  21,286  (176,232)Income Tax Expense12,655  10,794  8,404  (14,176)Minority Interest -   -   -   -  Net Income From Continuing Ops21,699  22,909  12,882  (162,056)Non-recurring EventsDiscontinued Operations -   -   -   -  Extraordinary Items -   -   -   -  Effect Of Accounting Changes -   -   -   - ...
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