PCTEL Reports Fourth Quarter and Full Year Financial Results
Highlights
- Revenue of
$22.9 million in the quarter and$90.6 million for the year, 8% higher in the quarter and 9% higher for the year compared to 2018. For the fourth quarter, revenue was higher by 55% for the test and measurement product line and lower by 7% for the antenna product line compared to 2018. For the year, revenue was higher by 68% for the test and measurement product line and lower by 5% for the antenna product line. - Gross profit margin of 50.3% in the quarter and 45.8% for the year, up 9.4% in the quarter and 8.3% for the year compared to the gross profit margin in 2018. The increase in the both the fourth quarter and the year is a result of higher revenues for test and measurement products and a favorable mix within antenna products.
- GAAP net income per share of
$0.10 in the quarter and$0.21 for the year compared to a GAAP loss of$0.53 per share in the quarter and a GAAP loss of$0.75 for the year in 2018. The 2019 GAAP results include a restructuring charge of approximately$0.01 per share in the quarter and$0.03 per share for the year related to the transition plan forChina manufacturing. In 2018, approximately$0.51 per share of the GAAP net loss in the quarter and$0.54 of the GAAP net loss for the year were attributable to non-cash income tax expense related to the Company’s valuation allowance for deferred tax assets. - Non-GAAP net income and adjusted EBITDA are measures the Company uses to measure its core earnings. A reconciliation of those non-GAAP measures to our GAAP financial statements is provided later in the press release.
- Non-GAAP net income per diluted share of
$0.16 in the quarter and$0.47 for the year compared to Non-GAAP net income per diluted share of$0.03 in the quarter and negative$0.04 for the year in 2018. - Adjusted EBITDA as a percent of revenue of 16.3% in the quarter and 12.4% for the year compared to 5.8% in the quarter and 1.8% for the year in 2018.
- Non-GAAP net income per diluted share of
$39.7 million of cash and short-term investments and no debt atDecember 31, 2019 compared to$35.2 million and no debt atDecember 31, 2018 .
“We are pleased with our performance in 2019 and year over year growth driven mainly by the success of our 5G testing solutions,” said
CONFERENCE CALL / WEBCAST
PCTEL’s management team will discuss the Company’s results today at
REPLAY: A replay will be available for two weeks after the call on either the website listed above or by calling (877) 481-4010 (
About PCTEL
PCTEL is a leading global provider of wireless technology, including purpose-built antenna systems, Industrial IoT devices, and test and measurement solutions. Trusted by our customers for over 25 years, we solve complex wireless challenges to help organizations stay connected, transform, and grow.
For more information, please visit our website at https://www.pctel.com/.
PCTEL Safe Harbor Statement
This press release and our related comments in our earnings conference call contain “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Specifically, the statements regarding our future financial performance, growth of our antenna solutions and test and measurement businesses, the impact of our transition plan for manufacturing inside and outside
PCTEL is a registered trademark of
PCTEL, INC. |
||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) |
||||||||
(in thousands, except share data) |
||||||||
|
|
|||||||
2019 |
2018 |
|||||||
ASSETS |
||||||||
Cash and cash equivalents |
$ |
7,094 |
|
$ |
4,329 |
|
||
Short-term investment securities |
|
32,556 |
|
|
30,870 |
|
||
Accounts receivable, net of allowances of |
|
17,380 |
|
|
15,864 |
|
||
Inventories, net |
|
11,935 |
|
|
12,848 |
|
||
Prepaid expenses and other assets |
|
1,842 |
|
|
1,416 |
|
||
Total current assets |
|
70,807 |
|
|
65,327 |
|
||
Property and equipment, net |
|
11,985 |
|
|
12,138 |
|
||
|
3,332 |
|
|
3,332 |
|
|||
Intangible assets, net |
|
144 |
|
|
1,029 |
|
||
Other noncurrent assets |
|
2,969 |
|
|
45 |
|
||
TOTAL ASSETS |
$ |
89,237 |
|
$ |
81,871 |
|
||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||
Accounts payable |
$ |
3,190 |
|
$ |
6,083 |
|
||
Accrued liabilities |
|
9,382 |
|
|
5,801 |
|
||
Total current liabilities |
|
12,572 |
|
|
11,884 |
|
||
Long-term liabilities |
|
3,315 |
|
|
381 |
|
||
Total liabilities |
|
15,887 |
|
|
12,265 |
|
||
Stockholders’ equity: | ||||||||
Common stock, shares issued and outstanding at |
|
19 |
|
|
18 |
|
||
Additional paid-in capital |
|
133,954 |
|
|
133,859 |
|
||
Accumulated deficit |
|
(60,305 |
) |
|
(64,055 |
) |
||
Accumulated other comprehensive loss |
|
(318 |
) |
|
(216 |
) |
||
Total stockholders’ equity |
|
73,350 |
|
|
69,606 |
|
||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
$ |
89,237 |
|
$ |
81,871 |
|
||
PCTEL, INC. |
||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) |
||||||||||||||
(in thousands, except per share data) |
||||||||||||||
Three Months Ended |
Year Ended |
|||||||||||||
|
|
|||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||
REVENUES |
$ |
22,897 |
$ |
21,241 |
|
$ |
90,617 |
$ |
82,979 |
|
||||
COST OF REVENUES |
|
11,385 |
|
12,543 |
|
|
49,105 |
|
51,898 |
|
||||
GROSS PROFIT |
|
11,512 |
|
8,698 |
|
|
41,512 |
|
31,081 |
|
||||
OPERATING EXPENSES: | ||||||||||||||
Research and development |
|
3,048 |
|
2,830 |
|
|
12,272 |
|
11,851 |
|
||||
Sales and marketing |
|
3,424 |
|
3,024 |
|
|
12,254 |
|
12,083 |
|
||||
General and administrative |
|
3,071 |
|
3,184 |
|
|
13,452 |
|
12,355 |
|
||||
Amortization of intangible assets |
|
49 |
|
85 |
|
|
219 |
|
418 |
|
||||
Restructuring expenses |
|
213 |
|
0 |
|
|
507 |
|
0 |
|
||||
Total operating expenses |
|
9,805 |
|
9,123 |
|
|
38,704 |
|
36,707 |
|
||||
OPERATING INCOME (LOSS) |
|
1,707 |
|
(425 |
) |
|
2,808 |
|
(5,626 |
) |
||||
Other income, net |
|
108 |
|
78 |
|
|
982 |
|
564 |
|
||||
INCOME (LOSS) BEFORE INCOME TAXES |
|
1,815 |
|
(347 |
) |
|
3,790 |
|
(5,062 |
) |
||||
Expense (benefit) for income taxes |
|
17 |
|
8,788 |
|
|
40 |
|
7,827 |
|
||||
NET INCOME (LOSS) |
$ |
1,798 |
$ |
(9,135 |
) |
$ |
3,750 |
$ |
(12,889 |
) |
||||
Net Income (Loss) per Share: | ||||||||||||||
Basic |
$ |
0.10 |
$ |
(0.53 |
) |
$ |
0.21 |
$ |
(0.75 |
) |
||||
Diluted |
$ |
0.10 |
$ |
(0.53 |
) |
$ |
0.21 |
$ |
(0.75 |
) |
||||
Weighted Average Shares: | ||||||||||||||
Basic |
|
18,034 |
|
17,361 |
|
|
17,853 |
|
17,186 |
|
||||
Diluted |
|
18,461 |
|
17,361 |
|
|
18,159 |
|
17,186 |
|
||||
Cash dividend per share |
$ |
0.055 |
$ |
0.055 |
|
$ |
0.220 |
$ |
0.220 |
|
||||
PCTEL, INC. |
||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) |
||||||||
(unaudited, in thousands) |
||||||||
Year Ended |
||||||||
. |
2019 |
2018 |
||||||
Operating Activities: | ||||||||
Net income (loss) from continuing operations |
$ |
3,750 |
|
$ |
(12,889 |
) |
||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||
Depreciation |
|
2,870 |
|
|
2,806 |
|
||
Intangible asset amortization |
|
885 |
|
|
1,084 |
|
||
Stock-based compensation |
|
4,133 |
|
|
3,261 |
|
||
Loss on disposal/sale of property and equipment |
|
97 |
|
|
19 |
|
||
Restructuring costs |
|
(33 |
) |
|
(39 |
) |
||
Bad debt provision |
|
(2 |
) |
|
265 |
|
||
Deferred tax provision |
|
0 |
|
|
7,817 |
|
||
Changes in operating assets and liabilities, net of acquisitions: | ||||||||
Accounts receivable |
|
(1,532 |
) |
|
2,362 |
|
||
Inventories |
|
873 |
|
|
(336 |
) |
||
Prepaid expenses and other assets |
|
385 |
|
|
198 |
|
||
Accounts payable |
|
(2,841 |
) |
|
1,095 |
|
||
Income taxes payable |
|
(22 |
) |
|
(3 |
) |
||
Other accrued liabilities |
|
2,263 |
|
|
(1,657 |
) |
||
Deferred revenue |
|
92 |
|
|
(40 |
) |
||
Net cash provided by operating activities |
|
10,918 |
|
|
3,943 |
|
||
Investing Activities: | ||||||||
Capital expenditures |
|
(2,263 |
) |
|
(2,754 |
) |
||
Proceeds from disposal of property and equipment |
|
0 |
|
|
15 |
|
||
Purchase of investments |
|
(48,245 |
) |
|
(44,591 |
) |
||
Redemptions/maturities of short-term investments |
|
46,559 |
|
|
46,220 |
|
||
Net cash used in finance activities |
|
(3,949 |
) |
|
(1,110 |
) |
||
Financing Activities: | ||||||||
Proceeds from issuance of common stock |
|
1,183 |
|
|
686 |
|
||
Payment of withholding tax on stock-based compensation |
|
(1,152 |
) |
|
(578 |
) |
||
Principle payments on finance leases |
|
(99 |
) |
|
(125 |
) |
||
Cash dividends |
|
(4,068 |
) |
|
(4,015 |
) |
||
Net cash used in financing activities |
|
(4,136 |
) |
|
(4,032 |
) |
||
Net increase (decrease) in cash and cash equivalents |
|
2,833 |
|
|
(1,199 |
) |
||
Effect of exchange rate changes on cash |
|
(68 |
) |
|
(31 |
) |
||
Cash and cash equivalents, beginning of period |
|
4,329 |
|
|
5,559 |
|
||
Cash and Cash Equivalents, End of Period |
$ |
7,094 |
|
$ |
4,329 |
|
||
PCTEL, INC. | ||||||||||||||||
REVENUE AND GROSS PROFIT BY PRODUCT LINE (unaudited) | ||||||||||||||||
(in thousands) | ||||||||||||||||
Three Months Ended |
Year Ended |
|||||||||||||||
Antenna Products |
Test & Measurement Products |
Corporate |
Total |
Antenna Products |
Test & Measurement Products |
Corporate |
Total |
|||||||||
REVENUES |
|
|
( |
|
|
|
( |
|
||||||||
GROSS PROFIT |
|
|
|
|
|
|
|
|
||||||||
GROSS PROFIT % |
37.6% |
74.3% |
50.3% |
34.8% |
69.9% |
45.8% |
||||||||||
Three Months Ended |
Year Ended |
|||||||||||||||
Antenna Products |
Test & Measurement Products |
Corporate |
Total |
Antenna Products |
Test & Measurement Products |
Corporate |
Total |
|||||||||
REVENUES |
|
|
( |
|
|
|
( |
|
||||||||
GROSS PROFIT |
|
|
|
|
|
|
|
|
||||||||
GROSS PROFIT % |
33.5% |
64.6% |
40.9% |
30.4% |
65.0% |
37.5% |
Reconciliation of GAAP to non-GAAP Results (unaudited) | |||||||||||||||
(in thousands except per share information) |
|||||||||||||||
Reconciliation of GAAP operating loss to non-GAAP operating income (loss) |
|||||||||||||||
Three Months Ended |
Year Ended |
||||||||||||||
|
2019 |
2018 |
|
2019 |
2018 |
||||||||||
Operating Income (Loss) |
$ |
1,707 |
|
( |
) |
$ |
2,808 |
|
( |
) |
|||||
(a) | Add: | ||||||||||||||
Amortization of intangible assets | |||||||||||||||
-Cost of revenues |
|
167 |
|
167 |
|
|
666 |
|
666 |
|
|||||
-Operating expenses |
|
49 |
|
85 |
|
|
219 |
|
418 |
|
|||||
Restructuring |
|
213 |
|
0 |
|
|
507 |
|
0 |
|
|||||
Stock Compensation: | |||||||||||||||
-Cost of revenues |
|
116 |
|
93 |
|
|
408 |
|
224 |
|
|||||
-Engineering |
|
145 |
|
158 |
|
|
652 |
|
620 |
|
|||||
-Sales & marketing |
|
151 |
|
114 |
|
|
673 |
|
576 |
|
|||||
-General & administrative |
|
475 |
|
324 |
|
|
2,401 |
|
1,841 |
|
|||||
|
1,316 |
|
941 |
|
|
5,526 |
|
4,345 |
|
||||||
Non-GAAP Operating Income (Loss) |
$ |
3,023 |
|
|
|
$ |
8,334 |
|
( |
) |
|||||
% of revenue |
|
13.2 |
% |
2.4 |
% |
|
9.2 |
% |
-1.5 |
% |
|||||
Reconciliation of GAAP net loss to non-GAAP net income (loss) |
|||||||||||||||
Three Months Ended |
Year Ended |
||||||||||||||
|
2019 |
2018 |
|
2019 |
2018 |
||||||||||
Net Income (Loss) |
$ |
1,798 |
|
( |
) |
$ |
3,750 |
|
( |
) |
|||||
Adjustments: | |||||||||||||||
(a) |
Non-GAAP adjustment to operating income (loss) |
|
1,316 |
|
941 |
|
|
5,526 |
|
4,345 |
|
||||
Income Taxes |
|
(233 |
) |
8,740 |
|
|
(705 |
) |
7,884 |
|
|||||
|
1,083 |
|
9,681 |
|
|
4,821 |
|
12,229 |
|
||||||
Non-GAAP Net Income (Loss) |
$ |
2,881 |
|
|
|
$ |
8,571 |
|
( |
) |
|||||
Non-GAAP Income (Loss) per Share: | |||||||||||||||
Basic |
$ |
0.16 |
|
|
|
$ |
0.48 |
|
( |
) |
|||||
Diluted |
$ |
0.16 |
|
|
|
$ |
0.47 |
|
( |
) |
|||||
Weighed Average Shares: | |||||||||||||||
Basic |
|
18,034 |
|
17,361 |
|
|
17,853 |
|
17,186 |
|
|||||
Diluted |
|
18,461 |
|
17,361 |
|
|
18,159 |
|
17,186 |
|
This schedule reconciles the Company's GAAP operating income (loss) to its non-GAAP operating income (loss). 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.
The adjustments to GAAP operating income (loss) (a) consist of stock compensation expense and amortization of intangible assets. The adjustments to GAAP net income (loss) include the non-GAAP adjustments to operating income (loss) as well as adjustments for (b) non-cash income tax expense.
|
||||||||||||||||
Reconciliation of GAAP operating loss to Adjusted EBITDA |
||||||||||||||||
(unaudited, in thousands) |
||||||||||||||||
Three Months Ended |
Year Ended |
|||||||||||||||
|
2019 |
|
2018 |
|
|
2019 |
|
2018 |
|
|||||||
Operating Income (Loss) |
$ |
1,707 |
|
( |
) |
$ |
2,808 |
|
( |
) |
||||||
Add: | ||||||||||||||||
Depreciation and amortization |
|
719 |
|
718 |
|
|
2,870 |
|
2,806 |
|
||||||
Intangible amortization |
|
216 |
|
252 |
|
|
885 |
|
1,084 |
|
||||||
Restructuring expenses |
|
213 |
|
0 |
|
|
507 |
|
0 |
|
||||||
Stock compensation expenses |
|
887 |
|
689 |
|
|
4,134 |
|
3,261 |
|
||||||
Adjusted EBITDA |
$ |
3,742 |
|
|
|
$ |
11,204 |
|
|
|
||||||
% of revenue |
|
16.3 |
% |
5.8 |
% |
|
12.4 |
% |
1.8 |
% |
This schedule reconciles the Company's GAAP operating income (loss) to Adjusted EBITDA. The Company believes that 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 Adjusted EBITDA when evaluating its financial results as well as for internal planning and forecasting purposes. Adjusted EBITDA should not be viewed as a substitute for the Company's GAAP results.
Adjusted EBITDA is defined as net income before interest, income taxes, depreciation and amortization. The adjustments on this schedule consist of depreciation, amortization of intangible assets, and stock compensation expenses
View source version on businesswire.com: https://www.businesswire.com/news/home/20200305005805/en/
CFO
(630) 339-2051
Senior Director, Corporate Marketing
(630) 339-2105
public.relations@pctel.com
Source: