July 25, 2007

PCTEL Posts $19.0 Million in Second Quarter Revenue

CHICAGO, Jul 25, 2007 (BUSINESS WIRE) --

PCTEL, Inc. (NASDAQ:PCTI), a leader in wireless broadband solutions, announced results for the second quarter ended June 30, 2007. Financial highlights of the quarter were:

-- $19.0 million in revenue for the quarter compared to $26.8 million in the same quarter last year. Last year's revenue included a one time $7.0 million intellectual property licensing settlement with Agere.

-- $16.2 million in revenue for the quarter from the Broadband Technology Group, down three percent from the same quarter last year. The company saw year over year growth in its scanning receiver product line and a decline in its antenna product revenue. The decline in antenna product revenue reflects the company's decision to exit the UMTS antenna market and the continued pruning of low margin product lines. Gross profit improved to 44 percent, compared to 43 percent in the second quarter of last year. The gross profit improvement reflected a greater contribution from our scanning receiver product line and the elimination of low cost antenna products.

-- $2.5 million in revenue for the quarter from the Mobility Solutions Group, compared to $2.7 million in the same quarter last year. This is a decrease of eight percent over the second quarter last year. The second quarter last year included a heavy concentration of software customization fees related to a large carrier win.

-- $0.3 million in licensing revenue for the quarter, compared to $7.4 million in the second quarter last year. Last year's second quarter results included a one time $7.0 million licensing settlement with Agere.

-- GAAP net loss of $(3.2) million for the quarter, or $(0.15) per basic share, compared to net income of $6.3 million, or $0.29 per diluted share for the same period in 2006. The second quarter this year included a $2.1 million restructuring charge related to the exiting of UMTS antenna operations. Last year's GAAP net income included the one-time $7.0 million IP settlement.

-- Non-GAAP net income of $1.0 million for the quarter, or $0.05 per diluted share compared to net income of $7.2 million, or $0.33 per diluted share for the same period in 2006. The Company's reporting of non-GAAP income excludes expenses for restructuring, stock based compensation, amortization and impairment of intangible assets and goodwill related to the Company's acquisitions, and non cash income tax expense. Last year's non-GAAP results also included the previously mentioned IP settlement.

-- $68.6 million of cash and short-term investments at June 30, 2007, as compared to $67.7 million at the end of the first quarter 2007. The company repurchased 146,000 shares in the quarter for $1.5 million under its share repurchase plan. The shares were purchased at an average price of $9.91.

"We took several decisive actions in the quarter to improve our long term results, specifically shutting down our operation in Ireland which was not meeting our financial objectives and focusing on sales growth by hiring a seasoned Vice President of Global Sales and Marketing," said Marty Singer, PCTEL's Chairman and CEO. "We now have a sharper focus and great opportunities to leverage a strong customer base and our technology investments as we move forward," added Singer.

PCTEL's management team will discuss the company's results during its scheduled earnings teleconference today at 6:15 PM EDT.

CONFERENCE CALL / WEBCAST

The company will hold a conference call at 6:15 PM EDT (5:15 PM CDT) today, Wednesday, July 25, 2007 with Marty Singer, Chairman and Chief Executive Officer, and John Schoen, Chief Financial Officer. PCTEL will not be responding to inquiries regarding its financial results until the conference call. The session can be accessed by calling (866) 454-4208 (U.S. / Canada) or (913) 312-1238 (international).

To listen via the Internet, please visit, www.pctel.com, or http://investor.pctel.com/events.cfm

REPLAY: A replay will be available for two weeks after the call on PCTEL's web site at www.pctel.com or by calling (888) 203-1112 (U.S. / Canada) or (719) 457-0820 (international) access code: 2112449.

About PCTEL

PCTEL, Inc. (Nasdaq:PCTI), which is headquartered in Chicago, is a global leader in wireless broadband solutions. The company's Broadband Technology Group (BTG) includes Antenna Products and RF Solutions. PCTEL's BTG designs, distributes, and supports innovative antenna solutions for public safety applications, unlicensed and licensed wireless broadband, fleet management, network timing, and other GPS applications. Its portfolio of OEM receivers, receiver based products and interference management solutions are used to measure, monitor and optimize cellular networks. PCTEL's Mobility Solutions' software tools provide secure, access independent, remote connectivity to the Internet and IMS software for converged handsets.

The company's products are sold or licensed to wireless carriers, wireless ISPs, distributors, system integrators, wireless test and measurement companies, wireless network equipment, handset manufacturers, and government agencies. PCTEL protects its technology with a strong intellectual property portfolio and broad cross-licensing agreements. For more information, please visit the company's web site at: http://www.pctel.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's expectations regarding the future sales growth and leveraging its customer base and technology investments 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's Securities 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 Condensed Statements of Operations
       (unaudited, in thousands, except per share information)


                               Three Months Ended    Six Months Ended
                                    June 30,             June 30,
                             --------------------- -------------------
                                2007       2006       2007      2006
                             ---------- ---------- --------- ---------

REVENUES                     $   18,962 $   26,758 $  37,913 $  45,324
COST OF REVENUES                  9,169      9,702    18,368    19,546
                             ---------- ---------- --------- ---------
GROSS PROFIT                      9,793     17,056    19,545    25,778
                             ---------- ---------- --------- ---------
OPERATING EXPENSES:
  Research and development        4,031      3,336     8,006     6,253
  Sales and marketing             3,412      3,196     6,879     6,738
  General and administrative      3,373      3,725     7,121     7,473
  Amortization of other
   intangible assets                476      1,056     1,172     2,093
  Restructuring charges           2,074    (1,269)     2,074     (716)
  Gain on sale of assets and
   related royalties              (250)      (250)     (500)     (500)
                             ---------- ---------- --------- ---------
       Total operating
        expenses                 13,116      9,794    24,752    21,341
                             ---------- ---------- --------- ---------
INCOME (LOSS) FROM
 OPERATIONS                     (3,323)      7,262   (5,207)     4,437
OTHER INCOME, NET                   847        747     1,800     1,368
                             ---------- ---------- --------- ---------
INCOME (LOSS) BEFORE INCOME
 TAXES                          (2,476)      8,009   (3,407)     5,805
PROVISION FOR INCOME TAXES          731      1,683       558     1,676
                             ---------- ---------- --------- ---------
NET INCOME (LOSS)            $  (3,207) $    6,326 $ (3,965) $   4,129
                             ========== ========== ========= =========

Basic income (loss) per
 share                       $   (0.15) $     0.30 $  (0.19) $    0.20
Shares used in computing
 basic income (loss) per
 share                           21,092     20,837    21,078    20,656

Diluted income (loss) per
 share                       $   (0.15) $     0.29 $  (0.19) $    0.19
Shares used in computing
 diluted income (loss) per
 share                           21,092     21,586    21,078    21,371

                              PCTEL Inc.

                Consolidated Condensed Balance Sheets
                      (unaudited, in thousands)

                                              June 30,    December 31,
                                                2007          2006
                                           ------------- -------------

                  ASSETS
CURRENT ASSETS:
  Cash and cash equivalents                $      68,644 $      59,148
  Short-term investments                              --        11,623
  Accounts receivable, net                        15,887        14,034
  Inventories, net                                 9,350         7,258
  Prepaid expenses and other assets                1,936         2,059
                                            ------------  ------------
         Total current assets                     95,817        94,122
PROPERTY AND EQUIPMENT, net                       12,488        12,357
GOODWILL                                          17,641        17,569
OTHER INTANGIBLE ASSETS, net                       5,182         7,451
OTHER ASSETS                                       1,183         1,221
                                           ------------- -------------
TOTAL ASSETS                               $     132,311 $     132,720
                                           ============= =============

   LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
  Accounts payable                                 4,774           885
  Deferred revenue                                 1,399         1,025
  Accrued liabilities                              6,941         6,964
  Short term debt                                    770           869
                                           ------------- -------------
         Total current liabilities                13,884         9,743
LONG-TERM LIABILITIES                              2,355         2,284
                                           ------------- -------------
         Total liabilities                        16,239        12,027
                                           ------------- -------------

STOCKHOLDERS' EQUITY:
  Common stock                                        22            22
  Additional paid-in capital                     166,654       165,556
  Accumulated deficit                           (50,636)      (46,671)
  Accumulated other comprehensive income              32         1,786
                                           ------------- -------------
         Total stockholders' equity              116,072       120,693
                                           ------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $     132,311 $     132,720
                                           ============= =============

                             PCTEL, Inc.

                  Revenue & Gross Profit by Segment
                      (unaudited, in thousands)

                               Three Months Ended    Six Months Ended
                                    June 30,             June 30,
                             --------------------- -------------------

                                2007       2006       2007      2006
                             ---------- ---------- --------- ---------
REVENUES:
---------------------------
Broadband Technology Group   $   16,175 $   16,708 $  32,516 $  32,768
Mobility Solutions Group          2,463      2,668     4,798     4,784
Licensing                           324      7,382       599     7,772
                             ---------- ---------- --------- ---------
TOTAL REVENUES                   18,962     26,758    37,913    45,324

GROSS PROFIT:
---------------------------
Broadband Technology Group   $    7,056 $    7,024 $  14,248 $  13,259
Mobility Solutions Group          2,417      2,653     4,705     4,755
Licensing                           320      7,379       592     7,764
                             ---------- ---------- --------- ---------
TOTAL GROSS PROFIT                9,793     17,056    19,545    25,778

GROSS PROFIT %:
---------------------------
Broadband Technology Group        43.6%      42.0%     43.8%     40.5%
Mobility Solutions Group          98.1%      99.4%     98.1%     99.4%
Licensing                         98.8%     100.0%     98.8%     99.9%
                             ----------  --------- ---------  --------
TOTAL GROSS PROFIT %              51.6%      63.7%     51.6%     56.9%
                             ----------  --------- ---------  --------

                             PCTEL, Inc.

 Reconciliation of Non-GAAP to GAAP Revenue & Gross Profit by Segment
----------------------------------------------------------------------
                      (unaudited, in thousands)



                                     Three Months Ended June 30, 2007
                                    ----------------------------------
                                       As       Non-GAAP         Non
                                    Reported  Adjustments  (a)   GAAP
                                    --------- ------------ ---- ------
REVENUES:
-----------------------------------
Broadband Technology Group             16,175                   16,175
Mobility Solutions Group                2,463                    2,463
Licensing                                 324                      324
                                    --------- ------------      ------
TOTAL REVENUES                         18,962                   18,962
                                    --------- ------------      ------

GROSS PROFIT:
-----------------------------------
Broadband Technology Group              7,056         (88)  (a)  7,144
Mobility Solutions Group                2,417                    2,417
Licensing                                 320                      320
                                    --------- ------------      ------
TOTAL GROSS PROFIT                      9,793         (88)       9,881
                                    --------- ------------      ------

GROSS PROFIT %:
-----------------------------------
Broadband Technology Group              43.6%                    44.2%
Mobility Solutions Group                98.1%                    98.1%
Licensing                               98.8%                    98.8%
                                    ---------                   ------
TOTAL GROSS PROFIT %                    51.6%                    52.1%
                                    =========                   ======





                                     Three Months Ended June 30, 2006
                                    ----------------------------------
                                       As       Non-GAAP         Non
                                    Reported  Adjustments  (a)   GAAP
                                    --------- ------------ ---- ------
REVENUES:
----------------------------------
Broadband Technology Group             16,708                   16,708
Mobility Solutions Group                2,668                    2,668
Licensing                               7,382                    7,382
                                    --------- ------------      ------
TOTAL REVENUES                         26,758                   26,758
                                    --------- ------------      ------

GROSS PROFIT:
----------------------------------
Broadband Technology Group              7,024         (86)  (a)  7,110
Mobility Solutions Group                2,653                    2,653
Licensing                               7,379                    7,379
                                    --------- ------------      ------
TOTAL GROSS PROFIT                     17,056         (86)      17,142
                                    --------- ------------      ------

GROSS PROFIT %:
----------------------------------
Broadband Technology Group              42.0%                    42.6%
Mobility Solutions Group                99.4%                    99.4%
Licensing                              100.0%                   100.0%
                                    ---------                   ------
TOTAL GROSS PROFIT %                    63.7%                    64.1%
                                    =========                   ======




(a) This adjustment reflects the non-cash stock based compensation
 expense for restricted grants, stock bonuses, and stock options
 awarded to the company's employees.

                             PCTEL, Inc.

 Reconciliation of Non-GAAP to GAAP Revenue & Gross Profit by Segment
----------------------------------------------------------------------
                      (unaudited, in thousands)



                                      Six Months Ended June 30, 2007
                                    ----------------------------------
                                       As       Non-GAAP         Non
                                     Reported  Adjustments (a)   GAAP
                                    --------- ------------ ---- ------
REVENUES:
-----------------------------------
Broadband Technology Group             32,516                   32,516
Mobility Solutions Group                4,798                    4,798
Licensing                                 599                      599
                                    --------- ------------      ------
TOTAL REVENUES                         37,913                   37,913
                                    --------- ------------      ------

GROSS PROFIT:
-----------------------------------
Broadband Technology Group             14,248        (187) (a)  14,435
Mobility Solutions Group                4,705                    4,705
Licensing                                 592                      592
                                    --------- ------------      ------
TOTAL GROSS PROFIT                     19,545        (187)      19,732
                                    --------- ------------      ------

GROSS PROFIT %:
-----------------------------------
Broadband Technology Group              43.8%                    44.4%
Mobility Solutions Group                98.1%                    98.1%
Licensing                               98.8%                    98.8%
                                    ---------                   ------
TOTAL GROSS PROFIT %                    51.6%                    52.0%
                                    =========                   ======





                                      Six Months Ended June 30, 2006
                                    ----------------------------------
                                       As       Non-GAAP         Non
                                     Reported  Adjustments (a)   GAAP
                                    --------- ------------ ---- ------
REVENUES:
----------------------------------
Broadband Technology Group             32,768                   32,768
Mobility Solutions Group                4,784                    4,784
Licensing                               7,772                    7,772
                                    --------- ------------      ------
TOTAL REVENUES                         45,324                   45,324
                                    --------- ------------      ------

GROSS PROFIT:
----------------------------------
Broadband Technology Group             13,259        (163) (a)  13,422
Mobility Solutions Group                4,755                    4,755
Licensing                               7,764                    7,764
                                    --------- ------------      ------
TOTAL GROSS PROFIT                     25,778        (163)      25,941
                                    --------- ------------      ------

GROSS PROFIT %:
----------------------------------
Broadband Technology Group              40.5%                    41.0%
Mobility Solutions Group                99.4%                    99.4%
Licensing                               99.9%                    99.9%
                                    ---------                   ------
TOTAL GROSS PROFIT %                    56.9%                    57.2%
                                    =========                   ======




(a) This adjustment reflects the non-cash stock based compensation
 expense for restricted grants, stock bonuses, and stock options
 awarded to the company's employees.


     Reconciliation Of Non GAAP To GAAP Results Of Operations (a)
----------------------------------------------------------------------
                      (unaudited, in thousands)


                                    Three Months Ended June 30, 2007
                                  ------------------------------------
                                     As       Non-GAAP          Non
                                  Reported  Adjustments  (a)   GAAP
                                  --------- ------------      -------
REVENUES                            $18,962                   $18,962
COST OF REVENUES                      9,169         (88) (b)    9,081
                                  --------- ------------      -------
GROSS PROFIT                          9,793           88        9,881
OPERATING EXPENSES:
  Research and development            4,031        (153) (b)    3,878
  Sales and marketing                 3,412        (183) (b)    3,229
  General and administrative          3,373        (714) (b)    2,659
  Amortization of other
   intangible assets                    476        (476)            -
  Restructuring charges               2,074      (2,074)            -
  Gain on sale of assets and
   related royalties                  (250)                     (250)
                                  --------- ------------      -------
       Total operating expenses      13,116      (3,600)        9,516
                                  --------- ------------      -------
INCOME (LOSS) FROM OPERATIONS       (3,323)        3,688          365
OTHER INCOME, NET                       847                       847
                                  --------- ------------      -------
INCOME (LOSS) BEFORE INCOME TAXES   (2,476)        3,688        1,212
PROVISION (BENEFIT) FOR INCOME
 TAXES                                  731        (547)          184
                                  --------- ------------      -------
NET INCOME (LOSS)                  $(3,207)       $4,235       $1,028
                                  --------- ------------      -------

Earnings (loss) per share
    Basic                           $(0.15)                     $0.05
    Diluted                         $(0.15)                     $0.05
Shares used in computing EPS
(in thousands)
    Basic                            21,092                    21,092
    Diluted                          21,092                    21,823



                                    Three Months Ended June 30, 2006
                                   -----------------------------------
                                      As       Non-GAAP          Non
                                    Reported  Adjustments (a)    GAAP
                                   --------- ------------      -------
REVENUES                             $26,758                   $26,758
COST OF REVENUES                       9,702         (86) (b)    9,616
                                   --------- ------------      -------
GROSS PROFIT                          17,056           86       17,142
OPERATING EXPENSES:
  Research and development             3,336        (161) (b)    3,175
  Sales and marketing                  3,196        (215) (b)    2,981
  General and administrative           3,725        (603) (b)    3,122
  Amortization of other intangible
   assets                              1,056      (1,056)            -
  Restructuring charges              (1,269)        1,269            -
  Gain on sale of assets and
   related royalties                   (250)                     (250)
                                   --------- ------------      -------
       Total operating expenses        9,794        (766)        9,028
                                   --------- ------------      -------
INCOME (LOSS) FROM OPERATIONS          7,262          852        8,114
OTHER INCOME, NET                        747                       747
                                   --------- ------------      -------
INCOME (LOSS) BEFORE INCOME TAXES      8,009          852        8,861
PROVISION (BENEFIT) FOR INCOME
 TAXES                                 1,683                     1,683
                                   --------- ------------      -------
NET INCOME (LOSS)                     $6,326         $852       $7,178
                                   --------- ------------      -------

Earnings (loss) per share
    Basic                              $0.30                     $0.34
    Diluted                            $0.29                     $0.33
Shares used in computing EPS
(in thousands)
    Basic                             20,837                    20,837
    Diluted                           21,586                    21,586



(a) These adjustments reconcile the company's GAAP net income to its
 non-GAAP net income. The company believes that presentation of net
 income excluding items such as non-cash compensation expense,
 amortization of intangible assets, restructuring charges, and non-
 cash income tax expense provides meaningful supplemental information
 to both management and investors that is indicative of the company's
 core results and facilitates comparison of results across reporting
 periods. The company uses this non-GAAP measure when evaluating its
 financial results as well as for internal planning and forecasting
 purposes. This non-GAAP measure should not be viewed as a substitute
 for the company's GAAP results.

(b) This adjustment reflects the non-cash stock based compensation
 expense for restricted grants, stock bonuses, and stock options
 awarded to the company's employees.

                         ``
     Reconciliation Of Non GAAP To GAAP Results Of Operations (a)
----------------------------------------------------------------------
                      (unaudited, in thousands)


                                     Six Months Ended June 30, 2007
                                   -----------------------------------
                                      As       Non-GAAP          Non
                                   Reported  Adjustments  (a)   GAAP
                                   --------- ------------      -------
REVENUES                             $37,913                   $37,913
COST OF REVENUES                      18,368        (187) (b)   18,181
                                   --------- ------------      -------
GROSS PROFIT                          19,545          187       19,732
OPERATING EXPENSES:
  Research and development             8,006        (387) (b)    7,619
  Sales and marketing                  6,879        (363) (b)    6,516
  General and administrative           7,121      (1,598) (b)    5,523
  Amortization of other intangible
   assets                              1,172      (1,172)            -
  Restructuring charges                2,074      (2,074)            -
  Gain on sale of assets and
   related royalties                   (500)                     (500)
                                   --------- ------------      -------
           Total operating
            expenses                  24,752      (5,594)       19,158
                                   --------- ------------      -------
INCOME (LOSS) FROM OPERATIONS        (5,207)        5,781          574
OTHER INCOME, NET                      1,800                     1,800
                                   --------- ------------      -------
INCOME (LOSS) BEFORE INCOME TAXES    (3,407)        5,781        2,374
PROVISION FOR INCOME TAXES               558        (547)           11
                                   --------- ------------      -------
NET INCOME (LOSS)                   $(3,965)       $6,328       $2,363
                                   --------- ------------      -------

Earnings (loss) per share
    Basic                            $(0.19)                     $0.11
    Diluted                          $(0.19)                     $0.11
Shares used in computing EPS
(in thousands)
    Basic                             21,078                    21,078
    Diluted                           21,078                    21,927



                                     Six Months Ended June 30, 2006
                                  ------------------------------------
                                      As       Non-GAAP          Non
                                   Reported  Adjustments  (a)   GAAP
                                  ---------- ------------      -------
REVENUES                             $45,324                   $45,324
COST OF REVENUES                      19,546        (163) (b)   19,383
                                   --------- ------------      -------
GROSS PROFIT                          25,778          163       25,941
OPERATING EXPENSES:
  Research and development             6,253        (306) (b)    5,947
  Sales and marketing                  6,738        (439) (b)    6,299
  General and administrative           7,473      (1,307) (b)    6,166
  Amortization of other intangible
   assets                              2,093      (2,093)            -
  Restructuring charges                (716)          716            -
  Gain on sale of assets and
   related royalties                   (500)                     (500)
                                   --------- ------------      -------
           Total operating
            expenses                  21,341      (3,429)       17,912
                                   --------- ------------      -------
INCOME (LOSS) FROM OPERATIONS          4,437        3,592        8,029
OTHER INCOME, NET                      1,368                     1,368
                                   --------- ------------      -------
INCOME (LOSS) BEFORE INCOME TAXES      5,805        3,592        9,397
PROVISION FOR INCOME TAXES             1,676                     1,676
                                   --------- ------------      -------
NET INCOME (LOSS)                     $4,129       $3,592       $7,721
                                   --------- ------------      -------

Earnings (loss) per share
    Basic                              $0.20                     $0.37
    Diluted                            $0.19                     $0.36
Shares used in computing EPS
(in thousands)
    Basic                             20,656                    20,656
    Diluted                           21,371                    21,371



(a) These adjustments reconcile the company's GAAP net income to its
 non-GAAP net income. The company believes that presentation of net
 income excluding items such as non-cash compensation expense,
 amortization of intangible assets, restructuring charges, and non-
 cash income tax expense provides meaningful supplemental information
 to both management and investors that is indicative of the company's
 core results and facilitates comparison of results across reporting
 periods. The company uses this non-GAAP measure when evaluating its
 financial results as well as for internal planning and forecasting
 purposes. This non-GAAP measure should not be viewed as a substitute
 for the company's GAAP results.

(b) This adjustment reflects the non-cash stock based compensation
 expense for restricted grants, stock bonuses, and stock options
 awarded to the company's employees.

SOURCE: PCTEL, Inc.

PCTEL, Inc.
John Schoen, 773-243-3000
CFO
or
Jack Seller, 773-243-3016
Public Relations
jack.seller@pctel.com

Copyright Business Wire 2007

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