VICTORIA – Sales plunged 25% and net income was flat for fiscal 2011 in what Vecima Networks chairman and CEO Dr. Surinder Kumar described as a “challenging year”.
Revenue for the year ended June 30th dropped 25% to $84.5 million, compared to $113.2 million last year, while net income was $292,000, virtually unchanged from $312,000 in 2010 (though fiscal 2011 net income was favorably impacted by a $14.0 million gain on the sale of radio spectrum.)
Gross margin decreased to 30%, providing a gross profit of $25.5 million during fiscal 2011, down from a gross margin of 34% for 2010 that provided a gross profit of $38.4 million.
The company cited the effects of foreign exchange, the general economic uncertainty and slow down, as well as a transition from legacy products to new products as factors in its 2011 results.
"We remain focused on our strategy to replace declining revenue from legacy products with recently introduced and new products”, said Dr. Kumar, in a statement. “We have made significant progress and there are quite a few encouraging signs. While the ramp up of four new products has proven challenging, we are quite encouraged by the recent revenue growth of our Terrace A and OEM QAM module products which were introduced in the last two years. Further, we are expending additional effort towards capturing new customers for existing products.”
