QUEBEC CITY — Telecom testing equipment and analytics solution provider EXFO Inc. announced Tuesday afternoon its financial results for the second quarter ended February 29, reporting the Covid-19 outbreak in China had negatively impacted its sales and earnings for the quarter.
The Quebec City-based company’s sales totalled US$55.3 million in the second quarter of fiscal 2020, down from US$73.9 million in the same quarter of 2019, primarily due to the negative impact of Covid-19 which forced EXFO to temporarily shut down its manufacturing operations in China, the company explained in its news release.
Test and measurement sales accounted for 68% of revenue in the second quarter of 2020, while service assurance, systems and services (SASS) sales represented 32%. Revenue distribution among the company’s three main selling regions amounted to 48% in the Americas, 31% in Europe, Middle East and Africa (EMEA) and 21% in Asia-Pacific.
The company’s net loss amounted to US$9 million, while adjusted EBITDA totalled -US$4.9 million, or -8.9% of sales. In comparison, in the same quarter of 2019, the company had reported net earnings of US$5.2 million and adjusted EBITDA of US$8.8 million, or 11.9% of sales. For the second quarter of 2020, the company generated US$7.1 million in cash flows from operations.
“Despite the temporary shutdown of our manufacturing operations in China, which negatively impacted our revenues, EXFO delivered solid bookings in the second quarter of 2020 with double-digit growth for our test and measurement business,” said EXFO’s CEO Philippe Morin. “Throughout the coronavirus pandemic, the safety of our employees, communities and customers remains at the centre of all our actions. All EXFO sites are fully operational and committed to helping global network operators and webscale companies thrive during this challenging period. More than ever, the telecom industry is mission-critical in which network capacity, reliability, and scalability will play a growing role in creating real opportunities for EXFO’s innovative solutions.”
As the coronavirus outbreak has evolved into a global pandemic and telecommuting from home has become a global trend, EXFO has become a key supplier to the essential telecommunications industry, the company says. Its test and service assurance solutions enable the deployment of bandwidth-intensive applications and the required virtualized, cloud-based networks, and other solutions such as geolocation analytics, virtual VPN remote monitoring and active monitoring of network and subscriber anomalies help customers to maintain peak performance under disruptive conditions, according to EXFO.
Due to the uncertainty surrounding the breadth and duration of the Covid-19 pandemic, EXFO has suspended issuing quarterly and annual guidance, the release says.
