MRV Reports First Quarter 2002 Financial Results

April 25th, 2002

CHATSWORTH, Calif., Apr 25, 2002 /PRNewswire-FirstCall via COMTEX/ -- MRV COMMUNICATIONS, INC. (Nasdaq: MRVC), a world-class leader in network infrastructure products and services, today reported its financial results for the first quarter ended March 31, 2002. These results are consistent with the revised guidance the Company issued on March 27, 2002.

Revenue for the first quarter of fiscal 2002 was $62.4 million compared to $73.5 million in the prior quarter and $100.1 million for the same quarter in the prior year.

Net loss for the first quarter was $32.5 million or ($0.38) per share compared to a net loss of $88.3 million or ($1.14) per share in the prior quarter and $54.3 million or ($0.73) per share for the same quarter in the prior year.

The net loss of $0.38 cents per diluted share is detailed as follows:

* Development Stage Enterprises contributed $0.10 cents to the net loss per diluted share;
* Operating Entities, excluding non-cash transactions, contributed $0.07 cents to the net loss per diluted share;



Of the non-cash transactions:

* Asset impairments on investments and our share in related investment losses contributed $0.11 to the net loss per diluted share; and
* Deferred stock compensation, amortization and other intangibles amortization contributed $0.10 to the net loss per diluted share.



Cash, short-term investments and time deposits totaled $154.5 million at March 31, 2002. During the quarter, MRV retired $24.3 million of its convertible debentures through the exchange of approximately 6.3 million shares of common stock. In addition, the Company paid off its $53.2 million in current debt (current maturities of long-term debt and its interest rate swap).

Noam Lotan, president and CEO of MRV, commented, "We were not immune to the adverse market conditions that affected most data networking companies. However, we are focused on achieving solid financial metrics, improved profitability, a solid balance sheet and positive cash flow in the future. Meanwhile, we are enthusiastic about our new products and technology recently introduced, like our award winning Ethernet over VDSL solutions, our Metro Access WDM Lambda Driver, and our newly granted patented technology for All-Optical Free Space Optics communications."

Mr. Lotan continued, "We have not seen any signs of a rebound, but we believe revenues will be flat for the second quarter and our loss per share will continue to decrease."

Cautionary Language Concerning Forward-Looking Statements Information set forth in this news release contains financial estimates and other forward-looking statements that are subject to risks and uncertainties. A discussion of factors that may affect future results is contained in MRV Communications' filings with the Securities and Exchange Commission. MRV Communications disclaims any obligation to update or revise statements contained in this news release based on new information or otherwise.

About MRV Communications, Inc.

MRV Communications, Inc. is a world-class leader in optical components and network infrastructure products and services. Product lines include: optical passive and active components, switches/routers, remote device management, services and network physical infrastructure products including Ethernet over DSL, free space optics and media connectivity solutions. For more information, call MRV at 818/773-0900 or visit www.mrv.com .

Simultaneous Webcast and Teleconference Information

MRV Communications will host a teleconference at 8:30 a.m. Eastern Time/5:30 a.m. Pacific Time on Friday, April 26, 2002 to discuss first-quarter 2002 results. To participate via telephone, the dial-in number is 706-634-0197, access code 3811229. Please call ten minutes prior to the scheduled conference call time. For live Webcasting, please go to the MRV Web site at www.mrv.com .

The conference call will be archived on the MRV Web site. A replay will be accessible by telephone after 11:00 a.m. Eastern/8:00 a.m. Pacific, for approximately 48 hours afterward. To replay the call, dial 800-642-1687 domestic or 706-645-9291 International using the access code 3811229.

For further information, please contact: Media/Investor Relations, Diana L. Hayden, +1-818-886-6782, ir@mrv.com.


MRV COMMUNICATIONS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands - except per share amounts)

Three Months Ended
(Unaudited) (Unaudited)
March 31, March 31,
2002 2001

Net revenue $62,418 $100,104
Cost of sales 43,105 66,391
Gross profit 19,313 33,713
Operating costs and expenses -
Selling, general and administrative 23,539 38,412
Product development and engineering 15,620 25,005
Amortization of intangibles 2,504 28,139
Total operating costs and expenses 41,663 91,556
Operating loss (22,350) (57,843)
Other expense, net 13,122 520

Loss before minority interest,
provision (benefit) for taxes
and extraordinary item (35,472) (58,363)
Minority interest 105 (1,388)
Provision (benefit) for taxes 186 (2,683)
Loss before extraordinary gain (35,763) (54,292)
Extraordinary gain on extinguishment
of debt, net of tax 3,244 --
Net loss $(32,519) $(54,292)
Earnings per share:
Basic and diluted loss per share -
Loss before extraordinary gain $(0.42) $(0.73)
Extraordinary gain $(0.04) $--
Net loss $(0.38) $(0.73)
Weighted average number of shares:
Basic and diluted 84,789 74,370


MRV COMMUNICATIONS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)

March 31, December 31,
2002 2001
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $90,685 $164,676
Short-term investments 54,226 46,696
Time deposits 9,603 9,341
Receivables, less allowances 50,166 55,106
Inventories 55,787 57,308
Other current assets 11,706 10,044
Total current assets 272,173 343,171
Property, plant and equipment, net 68,802 72,012
Goodwill and other intangibles, net 392,236 395,312
Investments 7,604 16,937
Deferred income taxes 23,749 23,229
Other assets 9,084 13,834
TOTAL ASSETS $773,648 $864,495

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $2,521 $52,226
Short-term obligations 19,247 18,679
Accounts payable 47,270 48,586
Accrued liabilities 31,541 39,035
Other current liabilities 6,637 9,277
Total current liabilities 107,216 167,803
Long-term debt 7,997 8,871
Convertible subordinated notes 65,346 89,646
Other long-term liabilities 3,940 3,737
Minority interest 9,269 9,762
Total Stockholders' equity 579,880 584,676
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $773,648 $864,495

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SOURCE MRV Communications, Inc.

Copyright (C) 2002 PR Newswire. All rights reserved.

Media/Investor Relations, Diana L. Hayden of MRV
Communications, Inc., +1-818-886-6782, ir@mrv.com

URL: http://www.mrv.com/
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