Aastra Technologies has reported record revenues in the fourth quarter and for the year ended December 31, 2008 as part of announcing its unaudited financial results for these periods.
Although net earnings in the fourth quarter were impacted by a non-cash asset impairment of certain long-lived assets and goodwill aggregating to $14.1 million and restructuring costs aggregating to $11.3 million, Aastra is pleased to report its 43rd consecutive quarter of profitability this quarter. Excluding these charges, Aastra’s fourth quarter operating results reflect a marked improvement from previous quarters in 2008 as Aastra prepares to face the difficult economic environment ahead in 2009.
Net revenue for the three months ended December 31, 2008 was a record $261.8 million compared to $155.2 million for the same quarter in 2007. The Company experienced a significant increase in revenue in all regions as a result of the Ericsson acquisition which closed on April 30, 2008. Excluding the impact of this acquisition, net revenue would have increased 13.2% to $175.8 million for the fourth quarter. Net sales from the former Ericsson product lines were $86.0 million, an increase of 16.2% from sales of $74.0 million in the third quarter of 2008.
Sales for the year ended December 31, 2008 were $832.1 million compared to $606.6 million for 2007, also a record for the Company. Excluding the revenue from the product lines acquired from Ericsson, sales would have increased by 1.7% from 2007 to $617.0 million in 2008.
Gross margin increased to 47.0% of sales in the fourth quarter of 2008 compared to 42.8% of sales in the same period in 2007. Gross margin for the year ended December 31, 2008 was 44.9% compared to 42.5% for the year in 2007. This significant increase in gross margin in the quarter and year over the same periods in 2007 is a result of the positive effect of several factors including lower overhead ratios and a favourable mix of product and service revenues.
Research and development expenses in the fourth quarter of 2008 were $27.7 million or 10.6% of sales, compared to $12.9 million or 8.4% of sales in the same quarter of 2007. Research and development expenses for the year ended December 31, 2008 increased to $98.0 million or 11.8% of sales from $54.6 million or 9.0% of sales in 2007. R&D cost reductions were obtained throughout the second half of the year in several product lines, including the former Ericsson products.