Aastra Q1 income down 9.5% to $147.3 million

Telecom Lead America: Aastra has reported $147.3 million
revenue for the first quarter ended March 31, 2012 compared to $162.7 million
for the same quarter in 2011, a decrease of approximately 9.5 percent.

Revenue decreases were experienced across most
geographical markets including Western Europe where the majority of the
company’s revenue is generated.

Gross margin increased to 43.4 percent of revenue in the
first quarter of 2012 compared to 42.5 percent of revenue in the same period in
2011 due to the higher margin earned on software applications and service

The company continues to experience an increase in
revenue from software applications and service as a percentage of total revenue
and this had a positive impact on gross margins realized during the first
quarter of 2012.

Research and development expenses in the first quarter of
2012 were $14.9 million or 10.1 percent of revenue, compared to $17.4 million
or 10.7 percent of revenue in the same quarter of 2011.

Selling, general and administrative expenses were $42.9
million or 29.1 percent of revenue in the first quarter of 2012 compared to
$44.7 million or 27.5 percent of revenue in the first quarter of 2011. Operating
expenses continued to decrease during the first quarter as a result of
continued cost control and efficiencies across most markets.

Profit increased in the first quarter this year to $2.0
million compared to $0.2 million in the same period in 2011.

Cash and short-term investments totaled $158.2 million at
the end of March 2012 compared to $134.1 million at December 31, 2011. During
the first quarter of 2012, the Company generated $28.7 million of cash flow in

Accounts receivables decreased by $18.0 million as a
result of the seasonally weaker sales value. In addition, inventory decreased
by an additional $3.6 million and finance lease receivables decreased by $2.6

Aastra enables Enterprises to communicate and collaborate
more efficiently and effectively by offering customers a full range of open
standard IP-based and traditional communications solutions, including
terminals, systems, and applications.

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