On Thursday, Dec. 14, networking equipment maker Ciena (NASDAQ:CIEN) released fourth-quarter 2006 earnings for the period ended Oct. 31.

  • Ciena has seen some hard times since that tech bubble popped, but this quarter's strong results brought in the first annual net profit since the year 2000.
  • The profits were made with a combination of cost controls and increased gross margins.
  • Ciena is currently just a one-star stock in the Motley Fool CAPS system. Is this the company's return to respectability, or is it not? Weigh in with your take right here.

(Figures in thousands, except per-share data)

Income Statement Highlights

Q4 2006

Q4 2005

Change

Sales

$159,952.0

$118,183.0

35.3%

Net Profit*

$13,087.0

($30,542.0)

N/A

EPS*

$0.14

($0.37)

N/A

Diluted Shares

93146.0

82689.0

12.6%

*Excluding $222 million in the 2005 period and $6,000 in 2006 in asset impairment and goodwill reduction charges, for a more fair comparison.

Get back to basics with a look at the income statement.

Margin Checkup

Q4 2006

Q4 2005

Change*

Gross Margin

45.49%

39.91%

5.58

Operating Margin

2.43%

(27.31%)

29.74

Net Margin

8.18%

(25.84%)

34.02

*Expressed in percentage points.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q4 2006

Q4 2005

Change

Cash + ST Invest.

$848,557.0

$837,543.0

1.3%

Accounts Rec.

$107,172.0

$72,786.0

47.2%

Inventory

$106,085.0

$49,333.0

115%



Liabilities

Q4 2006

Q4 2005

Change

Accounts Payable

$39,277.0

$43,868.0

(10.5%)

Long-Term Debt

$842,262.0

$648,752.0

29.8%



Learn the ways of the balance sheet.

Cash Flow Highlights

Q4 2006

Q4 2005

Change

Cash From Ops.

($79,393.0)

($128,039.0)

38%

Capital Expenditures

$17,760.0

$11,037.0

60.9%

Free Cash Flow

($97,153.0)

($139,076.0)

30.1%



Find out why Fools always follow the money.

Related Companies:

  • Alcatel Lucent (NYSE:ALU)
  • Nortel Networks (NYSE:NT)
  • Cisco Systems (NASDAQ:CSCO)
  • Tellabs (NASDAQ:TLAB)

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Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.

At the time of publication, Fool contributor Anders Bylund had no position in any company mentioned. Fool rules are here .