Newbridge has issued a profit warning - the second during its fiscal year, this time blaming inefficient order fulfilment processes.
For its fiscal fourth quarter, ended 2 May, Newbridge said it expects to rake in revenue of $460 million, with earnings per share to be between $0.12 and $0.14. This falls short of earnings per share of $0.21, expected by analysts polled by First Call.
Alan Lutz, the company's president and chief operating officer, explained that although orders in Europe and the Americas increased sequentially by 30 per cent and 35 per cent, respectively, Newbridge's order fulfilment is not "robust enough".
The ATM switch supplier won two thirds of its sales during the last month of the quarter and to accommodate this demand, it pre-builds equipment and adds modifications when the order arrives. This requires organising extra manufacturing capacity and the creation of incentives for sales people to order early.
However, "our control of this activity is not robust enough to allow us to generate consistently predictable results and must now be changed," he said.
"To add credence to this conclusion is the fact that one minute after the quarter closed, we still had orders, required by customers, amounting to $115 million. But we had run out of time," he added.
Newbridge is expected to announce its results on 1 June.
The firm fell below analysts' expectations by five cents for its fiscal third quarter by reporting earnings per share of $0.17. Net income was $120.1 million on revenue of $451 million. It had blamed weak sales in Latin America and Asia during that quarter.
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