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
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