Ad hoc: ADVA AG Optical Networking: ADVA OPTICAL NETWORKING REPORTS AUDITED 2008 IFRS FINANCIAL RESULTS WITH Q4 REVENUES EXCEEDING GUIDANCE

ADVA AG Optical Networking / Annual accounts / Ad hoc: ADVA OPTICAL
NETWORKING REPORTS AUDITED 2008 IFRS FINANCIAL RESULTS
WITH Q4 REVENUES EXCEEDING GUIDANCE

Ad hoc announcement according to §15 WpHG processed and transmitted
by Hugin. The issuer is solely responsible for the content of this
announcement.

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Q4 2008 revenues at EUR 56.8 million,
IFRS pro forma operating income of EUR 0.1 million(0.1% of revenues)

FY 2008 revenues at EUR 217.7 million,
IFRS pro forma operating income, excluding restructuring charges,
of EUR 1.5 million (0.7% of revenues)

Q1 2009 revenues expected to range
between EUR 50 million and EUR 55 million with
IFRS pro forma operating income between -4% and +1% of revenues

Norcross, Georgia, USA and Martinsried/Munich, Germany. March 10,
2009. ADVA Optical Networking announces Q4 and audited full-year 2008
financial results for the period ended December 31, 2008, and
prepared in accordance with International Financial Reporting
Standards (IFRS).

Q4 2008 IFRS FINANCIAL RESULTS
Revenues in Q4 2008 totaled EUR 56.8 million after EUR 53.8 million
in Q4 2007 and EUR 54.1 million in Q3 2008, above guidance of between
EUR 50 million and EUR 55 million. IFRS pro forma operating income,
excluding stock-based compensation and amortization & impairment of
goodwill & acquisition-related intangible assets, amounted to EUR 0.1
million in Q4 2008 or 0.1% of revenues, in line with guidance of
between -3% and +2% of revenues. This compares to a Q4 2007 IFRS pro
forma operating loss of EUR 12.1 million or 22.5% of revenues, and to
a Q3 2008 IFRS pro forma operating income of EUR 1.3 million or 2.4%
of revenues. The year-over-year recovery of pro forma operating
income to the largest extent is due to Q4 2007 one-off non-cash
charges related to the write-down of outdated inventory items and to
the impairment of capitalized research and development expenses.

The IFRS operating loss in Q4 2008 was EUR 0.5 million, after an
operating loss of EUR 23.2 million in Q4 2007. Key drivers for this
development are the above-mentioned non-cash charges, as well as
extraordinary high amortization of intangible assets from
acquisitions of EUR 10.4 million in Q4 2007, related to one-off
impairments of goodwill, purchased technology and in-process R&D
projects. This compares to Q4 2008 amortization of intangible assets
from acquisitions of EUR 0.7 million.

The IFRS net loss in Q4 2008 amounted to EUR 2.2 million, after a net
loss of EUR 27.7 million in Q4 2007. This reduction of net loss was
largely driven by the factors impacting the development of the
operating result described above. Basic and diluted IFRS net earnings
per share were EUR -0.05 each in Q4 2008 after EUR -0.60 each in
Q4 2007.
FULL-YEAR 2008 IFRS FINANCIAL RESULTS
Revenues came in at EUR 217.7 million in 2008, down from EUR 251.5
million in 2007. This development was mainly due to lower channel
partner business, specifically with one major distribution channel in
the U.S. since H2 2007. IFRS pro forma operating income at EUR -0.7
million in 2008 was slightly negative, after a positive EUR 1.8
million in 2007. Significantly higher revenues in 2007 were mostly
set off by the one-off charges described in the Q4 2007 analysis.
Excluding one-off restructuring charges of EUR 2.3 million incurred
in H1 2008, 2008 IFRS pro forma operating income would have been
positive at EUR 1.5 million.

The IFRS operating loss in 2008 was EUR 7.0 million, after an
operating loss of EUR 18.7 million in 2007. The major driver for the
operating loss reduction is the extraordinary high amortization of
intangible assets from acquisitions in Q4 2007, as described in the
Q4 2007 analysis.

Also, ADVA Optical Networking reported an IFRS net loss in 2008
amounting to EUR 8.9 million, after a net loss of EUR 29.5 million in
2007. Beyond the development of the operating loss, the reduction in
net loss was impacted by a high income tax charge of EUR 8.2 million
in 2007, mainly driven by changes in deferred tax assets and
liabilities related to a German tax audit and the impairment of
intangible assets. This compares to an income tax benefit of EUR 0.3
million in 2008. Basic and diluted IFRS net earnings per share were
EUR -0.19 each in 2008, after EUR -0.64 each in 2007.

CONFERENCE CALL AND WEBCAST
In conjunction with the release of its full-year 2008 audited IFRS
financial results on March 10, 2009, ADVA Optical Networking will
host a conference call for analysts and investors at
3:00 p.m. CET/10:00 a.m. EDT. Participating in the call will be ADVA
Optical Networking's chief executive officer, Brian Protiva, and
chief financial officer, Jaswir Singh. Interested parties may dial in
at +49 69 4035 9611 or +1 866 306 3455, and listen live via webcast
on ADVA Optical Networking's website, located on the "financial
results" page in the investor relations section of ADVA Optical
Networking's website at www.advaoptical.com.

CHANGE TO MANAGEMENT BOARD
ADVA Optical Networking will cut the number of members of its
Management Board from six to five, reducing the complexity of the
organization. Until the end of Q1 2009, the current Chief Operations
Officer (COO) Jürgen Hansjosten will hand over his COO
responsibilities to Jaswir Singh, who has been serving as Chief
Financial Officer (CFO) since Q4 2007. Jaswir Singh now assumes joint
CFO and COO responsibility.
Q1 2009 OUTLOOK
In light of the ongoing economic crisis, ADVA Optical Networking
expects Q1 2009 revenues to range between EUR 50 million and EUR 55
million. We anticipate pro forma operating income of between -4% and
+1% of revenues in Q1 2009. Further, ADVA Optical Networking notes
that it will continue to perform detailed quarterly reviews of the
expected business development in respect of all intangible assets,
including capitalized research and development expenses. These
reviews may result in non-cash impairment charges in Q1 2009 and
beyond. The pro forma operating income guidance provided above
excludes any such potential impairment charges. ADVA Optical
Networking will publish its Q1 2009 financial results on May 5, 2009.

IFRS CONSOLIDATED INCOME STATEMENT

(in thousands of EUR, Q4 Q4 FY FY
except earnings per share) 2008 2007 2008 2007

Revenues 56,849 53,812 217,672 251,486
Pro forma cost of goods sold -32,746 -36,024 -125,802 -151,050
Pro forma gross profit 24,103 17,788 91,870 100,436
Pro forma selling and marketing
expenses -9,157 -9,537 -34,087 -33,624
Pro forma
general and administrative expenses -6,746 -7,095 -26,298 -26,061
Pro forma
research and development expenses -10,010 -10,765 -40,682 -41,372
Income from capitalization of
development expenses, net of
amortization for capitalized
development projects 1,501 -2,089 9,004 2,315
Restructuring expenses 0 0 -2,251 0
Other operating income (expenses),
net 388 -429 1,736 86
Pro forma operating income 79 -12,127 -708 1,780
Amortization of
intangible assets from acquisitions -747 -10,438 -4,574 -17,308
Stock compensation expenses 121 -658 -1,761 -3,186
Operating income (loss) -547 -23,223 -7,043 -18,714
Interest income (expense), net -262 -192 -1,005 -853
Other income (expense), net -171 143 -1,103 -1,734
Income (loss) before tax -980 -23,272 -9,151 -21,301
Income tax benefit (expense), net -1,198 -4,435 275 -8,154
Net income (loss) -2,178 -27,707 -8,876 -29,455

Earnings per share in EUR
basic -0.05 -0.60 -0.19 -0.64
diluted -0.05 -0.60 -0.19 -0.64

# # #

The economic projections and forward-looking statements contained in
this document relate to future facts. Such projections and
forward-looking statements are subject to risks which cannot be
foreseen and which are beyond the control of ADVA Optical Networking.
ADVA Optical Networking is therefore not in a position to make any
representation as to the accuracy of economic projections and
forward-looking statements or their impact on the financial situation
of ADVA Optical Networking or the market in the shares of ADVA
Optical Networking.

ADVA Optical Networking provides consolidated pro forma financial
results in this press release solely as supplemental financial
information to help investors and the financial community make
meaningful comparisons of ADVA Optical Networking's operating results
from one financial period to another. ADVA Optical Networking
believes that these pro forma consolidated financial results are
helpful because they exclude non-cash charges related to the stock
option programs and amortization and impairment of goodwill and
acquisition-related intangible assets, which are not reflective of
the company's operating results for the period presented. This pro
forma information is not prepared in accordance with IFRS and should
not be considered a substitute for historical information presented
in accordance with IFRS.

PUBLISHED BY:
ADVA AG Optical Networking, Martinsried/Munich and Meiningen, Germany
ADVA Optical Networking North America, Inc., Norcross, Georgia, USA
ADVA Optical Networking (Shenzhen) Ltd., Shenzhen, China
www.advaoptical.com

FOR PRESS:
Christine Keck
t +1 201 258 8293
(U.S.)
t +44 1904 699 358 (Europe)
t +86 755 8621 7400 (Asia)
public-relations@advaoptical.com

FOR INVESTORS:
Wolfgang Guessgen
t +1 201 258 8302 (U.S.)
t +49 89 89 0665 940 (Europe)
t +86 755 8621 7400 (Asia)
investor-relations@advaoptical.com

--- End of Message ---

ADVA AG Optical Networking
Campus Martinsried, Fraunhoferstr. 9a
Martinsried/Munich Germany

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