Cites Strong Growth in Vertical Antenna Market and New Technology Deployment

BLOOMINGDALE, Ill.--(BUSINESS WIRE)-- PCTEL, Inc. (NASDAQ: PCTI), a leader in propagation and wireless network optimization solutions, announced results for the fourth quarter and year ended December 31, 2010.

Fourth Quarter and Annual Highlights

• $18.6 million in revenue for the quarter, an increase of 26 percent over the same period in 2009. $69.3 million in revenue for the year, an increase of 24 percent over 2009.
• Gross profit margin of 47 percent in the quarter, unchanged from the same period last year. Gross profit margin of 45 percent for the year, as compared to 47 percent in 2009.
• GAAP Operating margin of negative (7) percent for the quarter, compared to negative (4) percent for the same period in 2009. Operating margin for the year of negative (9) percent as compared to negative (11) percent in 2009.
• GAAP Net loss of $(705,000) for the quarter, or $(0.04) per basic share, compared to a net loss of $(572,000), or $(0.03) per basic share for the same period in 2009. Net Loss of $(3.5) million for the year or $(0.20) per basic share, as compared to a net loss of $(4.5) million or $(0.26) per basic share in 2009.
• Non-GAAP operating profit and net income are measures the company uses to reflect the results of its core earnings. The Company's reporting of non-GAAP net income excludes expenses for restructuring, gain or loss on sale of assets, stock based compensation, amortization and impairment of intangible assets and goodwill related to the Company's acquisitions, and non-cash related income tax expense.
  
  • Non-GAAP operating margin of 10 percent in the quarter, as compared to 4 percent in the same period in 2009. Non-GAAP operating margin for the year was 5% as compared to 3% for 2009.
  • Non-GAAP net income of $1.6 million or $0.09 per diluted share in the quarter, as compared to $663,000 or $0.04 per diluted share in the same period in 2009. Non-GAAP net income of $3.3 million or $0.18 per diluted share for the year, as compared to $2.2 million or $0.12 per diluted share in 2009.
• $70.9 million of cash, short-term investments, and long-term investments at December 31, 2010, a decrease of $700,000 from the preceding quarter. During the quarter the Company repurchased approximately 213,000 shares of its common stock for $1.3 million, and generated approximately $600,000 of cash and investments from all other sources. The Company has approximately $2.6 million remaining on its current share repurchase program authorization.

"PCTEL's revenue growth suggests that we have made progress in certain vertical antenna markets, including offloading, smart grid, SCADA, fleet and asset tracking," said Marty Singer, the company's Chairman and CEO. "We also began to see positive results from our investment in scanning receiver technology and new, regional deployments of cellular networks. We are optimistic about our growth prospects in 2011 and believe that we have an opportunity to leverage our R&D and business development investments in new markets, such as secure telephony," added Singer.

CONFERENCE CALL / WEBCAST

PCTEL's management team will discuss the Company's results today at 5:15 PM ET. The call can be accessed by dialing (877) 693-6682 (U.S. / Canada) or (706) 679-6397 (International), conference ID: 37532282. The call will also be webcast at http://investor.pctel.com/events.cfm.REPLAY: A replay will be available for two weeks after the call on either the website listed above or by calling (800) 642-1687 (U.S./Canada), or International (706) 645-9291, conference ID: 37532282.

About PCTEL

PCTEL, Inc. (NASDAQ: PCTI), is a global leader in propagation and wireless network optimization solutions. The company designs and develops software-based radios for wireless network optimization and develops and distributes innovative antenna solutions. The company's SeeGull® scanning receivers, receiver-based products and CLARIFY® interference management solutions are used to measure, monitor and optimize mobile networks. PCTEL's SeeGull scanning receivers are deployed in industry leading wireless test and measurement equipment and viewed as an essential wireless data collection tool for cellular network optimization, drive tests, and spectrum clearing. PCTEL develops and supports scanning receivers for LTE, EVDO, CDMA, WCDMA, TD-SCDMA and WiMAX networks. SeeHawk™, PCTEL's latest analysis tool, facilitates the visualization of data from all of PCTEL's data collection devices. PCTEL Secure, a joint venture with Eclipse Design Technologies, designs Android-based, secure communication products.

PCTEL's MAXRAD^®, Bluewave™ and Wi-Sys™ antenna solutions address public safety, military, aviation, defense and government applications; SCADA, Health Care, Energy, Smart Grid and Agricultural applications; Indoor Wireless, Wireless Backhaul, and Cellular applications. Its portfolio includes a broad range of WiMAX antennas, WiFi antennas, Land Mobile Radio antennas, and precision GPS antennas that serve innovative applications in telemetry, RFID, in-building, fleet management, and mesh networks. PCTEL provides parabolic antennas, ruggedized antennas, Yagi antennas, military antennas, precision aviation antennas and other high performance antennas for many applications. PCTEL's products are sold worldwide through direct and indirect channels. For more information, please visit the company's web sites www.pctel.com, www.antenna.com, www.antenna.pctel.com, www.rfsolutions.pctel.com or www.pctelsecure.com

PCTEL Safe Harbor Statement

This press release contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Specifically, the statements regarding PCTEL aggressively developing vertical markets for its antenna products and investing in scanning receiver and secure communication products are forward-looking statements within the meaning of the safe harbor. These statements are based on management's current expectations and actual results may differ materially from those projected as a result of certain risks and uncertainties, including the ability to successfully grow the wireless products business and the ability to implement new technologies and obtain protection for the related intellectual property. These and other risks and uncertainties are detailed in PCTEL'sSecurities and Exchange Commission filings. These forward-looking statements are made only as of the date hereof, and PCTEL disclaims any obligation to update or revise the information contained in any forward-looking statement, whether as a result of new information, future events or otherwise.

PCTEL, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
		December 31,			December 31,
		2010			2009
ASSETS
Cash and cash equivalents		$23,998			$35,543
Short-term investment securities		37,146			27,896
Accounts receivable, net of allowance for doubtful accounts		13,873			9,756
of $160 and $89 at December 31, 2010 and December 31, 2009, respectively
Inventories, net		10,729			8,107
Deferred tax assets, net		1,013			1,024
Prepaid expenses and other assets		3,900			2,541
Total current assets		90,659			84,867
Property and equipment, net		11,088			12,093
Long-term investment securities		9,802			12,135
Other intangible assets, net		8,865			9,241
Deferred tax assets, net		9,004			9,947
Other noncurrent assets		1,147			935
TOTAL ASSETS		$130,565			$129,218
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable		$4,253			$2,192
Accrued liabilities		7,546			3,786
Total current liabilities		11,799			5,978
Long-term liabilities		2,111			2,172
Total liabilities		13,910			8,150
Stockholders' equity:
Common stock, $0.001 par value, 100,000,000 shares		18			18
authorized, 18,285,784 and 18,494,499 shares issued and
outstanding at December 31, 2010 and December 31, 2009, respectively
Additional paid-in capital		137,154			138,141
Accumulated deficit		(20,578	)		(17,122	)
Accumulated other comprehensive income		61			31
Total stockholders' equity		116,655			121,068
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$130,565			$129,218

PCTEL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
			(unaudited)
			Three Months Ended							Year Ended
			December 31,							December 31,
			2010			2009				2010			2009
	REVENUES		$18,560			$14,786				$69,254			$56,002
	COST OF REVENUES		9,794			7,822				38,142			29,883
	GROSS PROFIT		8,766			6,964				31,112			26,119
	OPERATING EXPENSES:
	Research and development		2,649			2,712				11,777			10,723
	Sales and marketing		2,764			1,883				10,095			7,725
	General and administrative		2,576			2,430				10,224			9,674
	Amortization of other intangible assets		654			565				2,934			2,225
	Restructuring charges		346			-				931			493
	Impairment of goodwill and other intangible assets		1,084			-				1,084			1,485
	Gain (loss) on sale of product lines and related note receivable		-			(75	)			-			379
	Royalties		-			-				-			(400	)
	Total operating expenses		10,073			7,515				37,045			32,304
	OPERATING LOSS		(1,307	)		(551	)			(5,933	)		(6,185	)
	Other income, net		280			177				602			919
	LOSS BEFORE INCOME TAXES		(1,027	)		(374	)			(5,331	)		(5,266	)
	Provision (benefit) for income taxes		(322	)		198				(1,875	)		(783	)
	NET LOSS		($705	)		($572	)			($3,456	)		($4,483	)
	Basic Earnings per Share:
	Net Loss		($0.04	)		($0.03	)			($0.20	)		($0.26	)
	Diluted Earnings per Share:
	Net Loss		($0.04	)		($0.03	)			($0.20	)		($0.26	)
	Weighted average shares - Basic		17,092			17,446				17,408			17,542
	Weighted average shares - Diluted		17,092			17,446				17,408			17,542

Reconciliation GAAP To non-GAAP Results Of Operations (unaudited)
(in thousands except per share information)
Reconciliation of GAAP operating income to non-GAAP operating income (a)
			Three Months Ended December 31,							Year Ended December 31,
			2010			2009				2010			2009
	Operating Loss		($1,307	)		($551	)			($5,933	)		($6,185	)
(a)	Add:
	Amortization of intangible assets		654			565				2,934			2,225
	Restructuring charges		346			-				931			493
	Impairment of goodwill		1,084			-				1,084			1,485
	Gain (loss) on sale of product lines and related note receivable		-			(75	)			-			379
	Stock Compensation:
	-Cost of Goods Sold		78			76				415			334
	-Engineering		155			143				674			634
	-Sales & Marketing		256			101				975			500
	-General & Administrative		645			371				2,546			1,894
			3,218			1,181				9,559			7,944
	Non-GAAP Operating Income		$1,911			$630				$3,626			$1,759
	% of revenue		10.3	%		4.3	%			5.2	%		3.1	%
Reconciliation of GAAP net income to non-GAAP net income (b)
			Three Months Ended December 31,							Year Ended December 31,
			2010			2009				2010			2009
	Net Loss		($705	)		($572	)			($3,456	)		($4,483	)
	Add:
(a)	Non-GAAP adjustment to operating loss		3,218			1,181				9,559			7,944
(b)	Income Taxes		(681	)		54				(2,601	)		(1,262	)
(b)	Other income		(197	)		0				(197	)		0
			2,340			1,235				6,761			6,682
	Non-GAAP Net Income		$1,635			$663				$3,305			$2,199
	Basic Earnings per Share:
	Non-GAAP Net Income		$0.10			$0.04				$0.19			$0.13
	Diluted Earnings per Share:
	Non-GAAP Net Income		$0.09			$0.04				$0.18			$0.12
	Weighted average shares - Basic		17,092			17,446				17,408			17,542
	Weighted average shares - Diluted		17,516			17,794				17,954			17,862
	This schedule reconciles the company's GAAP operating income and GAAP net income to its non-GAAP operating income and non-GAAP net income. The company believes that presentation of this schedule provides meaningful supplemental information to both management and investors that is indicative of the company's core operating results and facilitates comparison of operating results across reporting periods. The company uses these non-GAAP measures when evaluating its financial results as well as for internal planning and forecasting purposes. These non-GAAP measures should not be viewed as a substitute for the company's GAAP results.
	(a) These adjustments reflect stock based compensation expense, amortization of intangible assets, restructuring charges, impairment charges, and the loss on the sale of product lines.
	(b) These adjustments include the items described in footnote (a) as well as the non-cash income tax expense and non-cash other income related to write-off of note payables.

PCTEL, Inc.
John Schoen
CFO
(630) 372-6800
or
Jack Seller
Public Relations
(630)372-6800
Jack.seller@pctel.com

Source: PCTEL, Inc.

News Provided by Acquire Media