July 24, 2008

PCTEL Posts $20.3 Million in Second Quarter Revenue from Continuing Operations

23 Percent Increase Over Same Period Last Year

Continued Growth In Operating Profit

BLOOMINGDALE, Ill., Jul 24, 2008 (BUSINESS WIRE) -- PCTEL, Inc. (NASDAQ: PCTI), a leader in propagation and optimization solutions for the wireless industry, announced results for the second quarter ended June 30, 2008.

The Company completed the sale of its Mobility Solutions Group (MSG) on January 4, 2008. The Company's financial statements reflect MSG as a discontinued operation.

Second Quarter Financial Highlights - Continuing Operations (excludes MSG)

-- $20.3 million in revenue from continuing operations for the quarter, an increase of 23 percent over the same period last year and an increase of 11% over the first quarter of this year.

-- Gross Profit from continuing operations of 48% versus 45% in the same period last year.

-- GAAP Operating Profit from continuing operations of 4% as compared to a loss of (21)% in the same period last year.

-- Non-GAAP Operating Profit from continuing operations of 14% versus 1% in the same period last year. The Company's reporting of non-GAAP operating profit excludes expenses for restructuring, stock based compensation, amortization and impairment of intangible assets and goodwill related to the Company's acquisitions.

-- GAAP net income from continuing operations of $0.5 million for the quarter, or $0.03 per diluted share, compared to a net loss of $(3.2) million, or $(0.15) per share for the same period in 2007.

-- Non-GAAP net income from continuing operations of $3.0 million for the quarter, or $0.15 per diluted share compared to $0.8 million of net income, or $0.04 per diluted share for the same period in 2007. 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 related income tax expense.

-- $85 million of cash and investments at June 30, 2008, of which $15 million is classified as long term.

The Company completed its previously announced 3.0 million share buyback during the quarter with the repurchase of 1.88 million shares for $17.0 million at an average price of $9.04. The company also paid out $10.3 million in a one-time cash dividend to shareholders during the quarter.

"The global transition to spread spectrum wireless technologies is creating strong opportunities for our scanning receivers and for specific antenna product families," said Marty Singer, PCTEL's Chairman and CEO. "We continue to benefit as well from the focus that we achieved with the divestiture of the software business."

Second Quarter Financial Highlights - Discontinued Operations (MSG)

-- GAAP net income from discontinued operations of $187,000 in the second quarter 2008 represents an adjustment to accrued income tax related to the gain on sale of the Mobility Solutions Group recorded in the first quarter 2008. The Company excludes discontinued operations from its non-GAAP earnings.

PCTEL's management team will discuss the Company's results during its scheduled earnings teleconference today at 5:15 PM EDT. Management will host the call from their corporate headquarters in Bloomingdale, Illinois.

CONFERENCE CALL / WEBCAST

The company will hold a conference call at 5:15 PM ET (4:15 PM CT) today, Thursday July 24, 2008 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 (800) 289-0726 (U.S. / Canada) or (913) 312-0391 (International).

To listen via the Internet, please visit 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: 3004106.

About PCTEL

PCTEL, Inc. (NASDAQ: PCTI), is a global leader in propagation and optimization solutions for the wireless industry. The company designs and develops software-based radios for wireless network optimization and develops and distributes innovative antenna solutions. PCTEL's MAXRAD(R) antenna solutions address public safety applications, unlicensed and licensed wireless broadband, fleet management, and network timing. Its portfolio includes a broad range of antennas for WiMAX, Land Mobile Radio, GPS, telemetry, RFID, WiFi, indoor cellular, and mesh networks. The company's SeeGull(R) scanning receivers, receiver-based products and CLARIFY(R) interference management solutions are used to measure, monitor and optimize cellular networks. PCTEL's products are sold worldwide through direct and indirect channels. For more information, please visit the company's web site at: 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 progress in growing its wireless RF business and improving operational effectiveness, the sufficiency of working capital to grow its business and accelerate growth through acquisitions, and its revenue forecast for the third quarter and the year 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,
                                 ------------------  -----------------
                                   2008      2007      2008     2007
                                 --------- --------  -------- --------
CONTINUING OPERATIONS
 REVENUES                         $20,274  $16,500   $38,574  $33,117
 COST OF REVENUES                  10,566    9,158    20,099   18,346
                                 --------- --------  -------- --------
 GROSS PROFIT                       9,708    7,342    18,475   14,771
                                 --------- --------  -------- --------
 OPERATING EXPENSES:
       Research and development     2,609    2,646     4,795    5,225
       Sales and marketing          2,874    2,670     5,637    5,408
       General and
        administrative              2,981    3,128     5,753    6,570
       Amortization of other
        intangible assets             552      476       992    1,172
       Restructuring charges          (13)   2,074       364    2,074
       Gain on sale of assets
        and related royalties        (200)    (250)     (400)    (500)
                                 --------- --------  -------- --------
            Total operating
             expenses               8,803   10,744    17,141   19,949
                                 --------- --------  -------- --------
 OPERATING INCOME (LOSS) FROM
  CONTINUING OPERATIONS               905   (3,402)    1,334   (5,178)
 OTHER INCOME, NET                    652      847     1,437    1,800
                                 --------- --------  -------- --------
 INCOME (LOSS) FROM CONTINUING
  OPERATIONS BEFORE
     INCOME TAXES AND
      DISCONTINUED OPERATIONS       1,557   (2,555)    2,771   (3,378)
 PROVISION FOR INCOME TAXES         1,027      676     1,764      578
                                 --------- --------  -------- --------
 NET INCOME (LOSS) FROM
  CONTINUING OPERATIONS               530   (3,231)    1,007   (3,956)
                                 --------- --------  -------- --------
DISCONTINUED OPERATIONS
 NET INCOME (LOSS) FROM
  DISCONTINUED OPERATIONS,            187       24    36,878       (9)
    NET OF TAX
                                 --------- --------  -------- --------
NET INCOME (LOSS)                    $717  ($3,207)  $37,885  ($3,965)
                                 ========= ========  ======== ========

 Basic Earnings per Share:
 Income (Loss) from Continuing
  Operations                        $0.03   ($0.15)    $0.05   ($0.19)
 Income from Discontinued
  Operations                        $0.01    $0.00     $1.87    $0.00
 Net Income (Loss)                  $0.04   ($0.15)    $1.92   ($0.19)

 Diluted Earnings per Share:
 Income (Loss) from Continuing
  Operations                        $0.03   ($0.15)    $0.05   ($0.19)
 Income from Discontinued
  Operations                        $0.01    $0.00     $1.86    $0.00
 Net Income (Loss)                  $0.04   ($0.15)    $1.91   ($0.19)

 Weighted average shares - Basic   19,089   21,092    19,762   21,078
 Weighted average shares -
  Diluted                          19,413   21,092    19,862   21,078


                              PCTEL Inc.
                Consolidated Condensed Balance Sheets
                      (unaudited, in thousands)

                                                June 30,  December 31,
                                                  2008        2007
                                                --------- ------------

                    ASSETS
CURRENT ASSETS:
       Cash and cash equivalents                 $58,157      $26,632
       Short-term investment securities           11,609       38,943
       Accounts receivable, net                   13,516       16,082
       Inventories, net                            9,843        9,867
       Deferred tax assets, net                    1,591        1,591
       Prepaid expenses and other assets           1,197        1,800
                                                --------- ------------
              Total current assets                95,913       94,915
PROPERTY AND EQUIPMENT, net                       12,256       12,136
LONG-TERM INVESTMENT SECURITIES                   14,873           --
GOODWILL                                          17,336       16,770
OTHER INTANGIBLE ASSETS, net                       6,634        4,366
DEFERRED TAX ASSETS, net                           4,863        4,863
OTHER ASSETS                                         913        1,022
ASSETS OF DISCONTINUED OPERATIONS                     --        1,807
                                                --------- ------------
TOTAL ASSETS                                    $152,788     $135,879
                                                ========= ============

     LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
       Accounts payable                           $1,984         $956
       Accrued liabilities                         5,744        8,395
       Short term debt                                --          107
       Income tax liabilities                     12,177            8
                                                --------- ------------
              Total current liabilities           19,905        9,466
LONG-TERM LIABILITIES                              1,119        1,192
LIABILITIES OF DISCONTINUED OPERATIONS                --          654
                                                --------- ------------
              Total liabilities                   21,024       11,312
                                                --------- ------------

STOCKHOLDERS' EQUITY:
       Common stock                                   19           22
       Additional paid-in capital                144,726      165,108
       Accumulated deficit                       (13,050)     (40,640)
       Accumulated other comprehensive income         69           77
                                                --------- ------------
              Total stockholders' equity         131,764      124,567
                                                --------- ------------
  TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY    $152,788     $135,879
                                                ========= ============


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

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

                                        2008    2007    2008    2007
                                       ------- ------- ------- -------
REVENUES:
--------------------------------------
Broadband Technology Group             $20,240 $16,176 $38,434 $32,518
Licensing                                   34     324     140     599
                                       ------- ------- ------- -------
TOTAL REVENUES                          20,274  16,500  38,574  33,117

GROSS PROFIT:
--------------------------------------
Broadband Technology Group               9,676   7,022  18,339  14,179
Licensing                                   32     320     136     592
                                       ------- ------- ------- -------
TOTAL GROSS PROFIT                       9,708   7,342  18,475  14,771

GROSS PROFIT %:
--------------------------------------
Broadband Technology Group               47.8%   43.4%   47.7%   43.6%
Licensing                                94.1%   98.8%   97.1%   98.8%
                                       ------- ------- ------- -------
TOTAL GROSS PROFIT %                     47.9%   44.5%   47.9%   44.6%
                                       ------- ------- ------- -------


      Reconciliation Of Non GAAP To GAAP Results Of Operations (a)
   -------------------------------------------------------------------
         (unaudited, in thousands except per share information)

   Reconciliation of GAAP operating income from continuing operations
    to non-GAAP operating income from continuing operations
   -------------------------------------------------------------------

                                  Three Months Ended  Six Months Ended
                                       June 30,           June 30,
                                  ------------------  ----------------
                                    2008      2007     2008     2007
                                  --------- --------  ------- --------

   Operating Income (Loss) from
    Continuing Operations             $905  ($3,402)  $1,334  ($5,178)

(a)Add:
     Amortization of other
      intangible assets                552      476      992    1,172
     Restructuring charges             (13)   2,074      364    2,074
     Stock Compensation:
        -Cost of Goods Sold            124       88      216      187
        -Engineering                   148       84      302      224
        -Sales & Marketing             237      162      392      301
        -General & Administrative      904      645    1,652    1,416
                                  --------- --------  ------- --------
                                     1,952    3,529    3,918    5,374

                                  --------- --------  ------- --------
   Non-GAAP Operating Income        $2,857     $127   $5,252     $196
                                  ========= ========  ======= ========
   % of revenue                       14.1%     0.8%    13.6%     0.6%

   Reconciliation of GAAP net income from continuing operations to
    non-GAAP net income from continuing operations
   -------------------------------------------------------------------

                                  Three Months Ended  Six Months Ended
                                       June 30,           June 30,
                                  ------------------  ----------------
                                    2008      2007     2008     2007
                                  --------- --------  ------- --------

   Net Income (Loss) from
    Continuing Operations             $530  ($3,231)  $1,007  ($3,956)

   Add:
(a)  Non-GAAP adjustment to
      operating income (loss)        1,952    3,529    3,918    5,374
(b)  Income Taxes                      492      492      714      567
                                  --------- --------  ------- --------
                                     2,444    4,021    4,632    5,941

                                  --------- --------  ------- --------
   Non-GAAP Net Income              $2,974     $790   $5,639   $1,985
                                  ========= ========  ======= ========

   Basic Earnings per Share:
   Income from Continuing
    Operations                       $0.16    $0.04    $0.29    $0.09

   Diluted Earnings per Share:
   Income from Continuing
    Operations                       $0.15    $0.04    $0.28    $0.09

   Weighted average shares -
    Basic                           19,089   21,092   19,762   21,078
   Weighted average shares -
    Diluted                         19,413   21,823   19,862   21,927

   This schedule reconciles the company's GAAP operating income and
    GAAP net income from continuing operations to its non-GAAP
    operating income and non-GAAP net income from continuing
    operations. 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 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 the stock based compensation expense,
    amortization of intangible assets, and restructuring charges

   (b) These adjustments reflect the non-cash income tax expense

SOURCE: PCTEL, Inc.

PCTEL, Inc.
John Schoen
CFO
(630) 372-6800
or
PCTEL, Inc.
Jack Seller
Public Relations
(630) 372-6800
jack.seller@pctel.com
or
Summit IR Group
Mary McGowan
Investor Relations
(408) 404-5401
mary@summitirgroup.com

Copyright Business Wire 2008

News Provided by COMTEX


Close window | Back to top

Copyright 2017 PCTEL, Inc.