Sierra Wireless bringt gute Zahlen heute, wunderbar. 10 Dollar fallen bald und ich kann mich genüsslich zurücklehnen.
Gruss E.
Sierra Wireless Reports Second Quarter 2003 Results
VANCOUVER, BRITISH COLUMBIA, Jul 17, 2003 (CCNMatthews via COMTEX) -- Sierra
Wireless, Inc. (NASDAQ: SWIR, TSX: SW) is reporting better than expected second
quarter results, including revenue of $20.7 million, net earnings of $0.9
million and positive cash flow.
"We are pleased to report that, for the fourth quarter in a row, we grew
revenues over the comparable quarter, were profitable and generated positive
cash flow. The AirCard product line and sales in the United States, Europe and
the Asia-Pacific region each contributed significantly during the second
quarter", said David Sutcliffe, Chairman and Chief Executive Officer. "Looking
ahead, we plan to complete the AirPrime acquisition and business integration. We
expect overall economic and industry conditions to continue to be challenging.
Our business operating premise is profitable growth and our priorities remain
expansion of our distribution channels, sell through to end customers and
investment in new products for future growth."
Our results are reported in US dollars and are prepared in accordance with
United States generally accepted accounting principles. During the second
quarter of 2003, we received and recorded an unexpected additional recovery of
$0.3 million from Metricom. During the second quarter of 2002, we recorded
restructuring and other charges of $36.1 million. Our results, where described
as adjusted, exclude these amounts.
Results for the second quarter of 2003, relative to company guidance provided on
April 24, 2003:
Second quarter revenue for 2003 of $20.7 million was better than our guidance
range of $19.0 to $20.0 million. Gross margin was 40.3%, better than our
guidance of approximately 39.0%. Our adjusted operating expenses were $7.8
million, higher than our guidance range of $7.4 to $7.6 million. Our adjusted
net earnings of $0.6 million, or diluted earnings per share of $0.04, were
better than our net earnings guidance range of $0.1 to $0.3 million, or diluted
earnings per share of $0.01 to $0.02. We had a positive cash flow of $0.5
million that was better than our guidance of neutral cash flow.
Results for the second quarter of 2003, compared to the second quarter of 2002:
Our revenue for the second quarter of 2003 increased by 22.4% to $20.7 million
from $16.9 million for the same period in 2002. Adjusted gross margin improved
to 40.3% from 37.1%. Adjusted operating expenses declined to $7.8 million from
$10.0 million. Second quarter adjusted earnings for 2003 increased to $0.6
million or diluted earnings per share of $0.04, compared to an adjusted loss of
$3.0 million or loss per share of $0.18.
Results for the second quarter of 2003, compared to the first quarter of 2003:
Our revenue for the three months ended June 30, 2003 amounted to $20.7 million,
compared to $20.1 million in the first quarter of 2003, an increase of 2.8%.
Gross margins were $8.3 million or 40.3% in the second quarter of 2003, compared
to $7.9 million or 39.5% in the first quarter of 2003. Our gross margin
percentage improved compared to the previous quarter due to a greater percentage
of sales coming from our 2.5G AirCard products as well as product cost
reduction.
Adjusted operating expenses were $7.8 million, compared to $7.6 million in the
previous quarter. This increase is a result of decreased funding from our
research and development funding agreements compared to the previous quarter.
Our gross research and development investments were $3.1 million in both
quarters.
Our adjusted net earnings were $0.6 million for the three months ended June 30,
2003, compared to $0.4 million for the three months ended March 31, 2003. Our
adjusted diluted earnings per share were $0.04 for the second quarter of 2003,
compared to diluted earnings per share of $0.02 for first quarter of 2003.
Acquisition of AirPrime, Inc.
On June 16, 2003, we announced a definitive agreement to acquire AirPrime, Inc.,
a privately-held, leading supplier of high-speed CDMA wireless products located
in Carlsbad, California. The combined entity is expected to be a well-positioned
market leader with a broad product line, innovative engineering, blue chip
customers, global channels and a strong balance sheet. We expect the combination
to close during August.
Changes to Supply Chain
During the quarter, we implemented significant changes to our supply chain.
These included the transfer of global fulfillment and CDMA product manufacturing
to Flextronics. By using their fully integrated supply chain services, we expect
to reduce product costs, improve alignment with our increasingly international
customer base and achieve increased operating efficiencies and scalability. We
expect to purchase finished goods closer to the time of shipment to our
customers, reducing our working capital requirements associated with carrying
inventory.
Previously, fulfillment services were provided by Globalware while CDMA
production was handled by SCI-Sanmina. We continue to have GSM production at
Solectron and CDPD and specialty production at Creation Technologies.
Second Quarter Highlights Included:
- We signed a distribution agreement with Panasonic Canada Inc, a division of
Matsushita Electric Industrial Co., Ltd. of Japan, one of the world's largest
producers of electronics and electric products for consumer, business and
industrial use. Under the agreement, Panasonic will distribute our next
generation product line, including CDMA2000 1X and GSM/GPRS products, through
its value added reseller channels in Canada.
- Together with Citrix Systems, Inc. and Zumasys, Inc., we announced that
Momentum Group, a leading supplier of contract textiles, has equipped its North
American sales force with a complete mobile solution that included Panasonic
Toughbooks, Citrix MetaFrame XP(TM) Presentation Server and the Sierra Wireless
AirCard(R) 550 and AirCard 555. This new implementation gives Momentum's sales
representatives wireless access to critical business applications, improving
response time and overall customer satisfaction.
- Together with IBM, we announced a bundled wireless solution using the Sierra
Wireless AirCard 750, a wireless wide area network PC Card, combined with the
IBM ThinkPad T40 notebook series, a high-end notebook computer with built in
wireless local area network functionality. IBM chose the AirCard specifically
for its high performance wide area wireless capabilities and for its ability to
enhance an end-to-end mobile solution.
- We announced the commercial availability of the MP 750, the first of our next
generation MP ruggedized wireless modems, across North America and Europe. The
next generation MP Series, built for extreme environments and industries that
require an in-vehicle mobile solution, will include both the MP 750 for GSM/GPRS
networks, and the MP 555 for CDMA2000 1X networks. The MP 555 is expected to be
launched later this year.
- We announced that the Mesquite Police Department in Texas is the first police
force in North America to implement the MP 750 to protect its community while
patrolling over 377 miles of arterial and residential streets. The next
generation wireless data solution was chosen specifically for its unique
security features and its ability to provide faster access to mission critical
information.
- We appointed Charles E. Levine, formerly of Sprint PCS, to our Board of
Directors. Mr. Levine has more than 25 years of experience in building
businesses for some of North America's largest companies. Mr. Levine's expertise
in business strategy, marketing and sales will be invaluable to our team.
Voluntary Option Surrender Initiative
During the second quarter, we instituted and completed a voluntary Employee
Stock Option Plan ("ESOP") surrender initiative. The objective of the ESOP is to
enable us to recruit, retain and motivate participants to increase the value of
our company on a sustainable basis. The objectives of the ESOP surrender
initiative are to have deeply "under water" stock options returned to the pool
now, rather than having them expire unexercised some time in the future, and to
enable us to operate the ESOP within the existing number of options that have
already been approved by shareholders. Surrenders by employees, officers and
directors were voluntary. The company had approximately 3.2 million net options
authorized, with 2.5 million issued and 0.7 million available for issuance.
Options with an exercise price below Cdn$20.00 were not eligible for surrender.
Of the 2.5 million issued, there were approximately 1.0 million eligible for
surrender. Of the eligible options, approximately 0.7 million were surrendered,
with exercise prices ranging from Cdn.$20.46 to Cdn.$212.00.
We do not intend to reprice existing options, either immediately or through a
short-term re-issuance of the surrendered options. ESOP participants who
surrendered options are "at risk" through the loss of the vesting associated
with those options and through the uncertainty as to availability, quantity,
timing and exercise price of future grants. Directors, including David
Sutcliffe, the company's Chairman and Chief Executive Officer, are ineligible to
receive any future recognition for their participation in the surrender program.
We expect over time to reduce the size of the ESOP as a percentage of issued and
outstanding shares.
Financial Guidance
For the third and fourth quarters ending September 30, 2003 and December 31,
2003, respectively, we are providing the following guidance reflecting our
current business indicators and expectations. Inherent in this guidance is
higher than normal risk resulting from uncertainty associated with the
acquisition of AirPrime, the timing of volume shipments to channels and with the
rate of end customer adoption of newer products. All figures are estimates and
are approximations.
This guidance reflects a planning assumption that the company will commence
consolidating financial results with AirPrime on September 1st, 2003. We expect
to incur AirPrime related restructuring costs in Q3 2003 and integration costs
in both Q3 and Q4 2003. In both quarters, we expect to be profitable, excluding
the restructuring and integration costs. We expect integration activities and
costs to be substantially completed by year-end.
Q3 2003 Q4 2003
------- -------
Revenue $24 - $25 million $28 - $30 million
Gross margin 39% 38% - 39%
Operating expenses $8.4 - $8.7 million $9.8 - $10.4 million
Restructuring and
other charges $2.5 million Nil
Integration costs $1.5 million $1.1 - $1.5 million
Net earnings (loss) $(2.9) - $(3.0) million $(0.2) - $(0.3) million
Diluted earnings
(loss) per share $(0.17) $(0.01)
Net earnings (loss),
excluding restructuring
and integration costs $0.9 - $1.0 million $0.8 - $1.3 million
Diluted earnings (loss)
per share, excluding
restructuring and
integration costs $0.05 - $0.06 $0.04 - $0.06
Cash flow Neutral, excluding Neutral
cash costs related
to the acquisition
Management Retirement
Peter Roberts, CFO, has determined that he will be retiring from the company in
February, 2004. To allow for an orderly transition, the company has engaged Korn
Ferry to assist with the executive search for his replacement. Mr. Roberts
joined Sierra Wireless in January, 1999 and has been instrumental in helping the
company become a leading wireless solutions company.
Forward-Looking Statements
This press release contains forward-looking statements that involve risks and
uncertainties. These forward-looking statements relate to, among other things,
plans and timing for the introduction or enhancement of our services and
products, statements about future market conditions, supply conditions, channel
and end customer demand conditions, revenues, gross margins, operating expenses,
profits, and other expectations, intentions, and plans contained in this press
release that are not historical fact. Our expectations regarding future revenues
and earnings depend in part upon our ability to develop, manufacture, and supply
products that we do not produce today and that meet defined specifications. When
used in this press release, the words "plan", "expect", "believe", and similar
expressions generally identify forward-looking statements. These statements
reflect our current expectations. They are subject to a number of risks and
uncertainties, including, but not limited to, changes in technology and changes
in the wireless data communications market. In light of the many risks and
uncertainties surrounding the wireless data communications market, you should
understand that we cannot assure you that the forward-looking statements
contained in this press release will be realized.
About Sierra Wireless
Sierra Wireless, Inc. is a global leader in delivering highly differentiated
wireless solutions. Sierra Wireless develops and markets the AirCard(R), a
wireless PC Card for portable computers, OEM modules for embedded applications,
and rugged vehicle-mounted wireless systems. Sierra Wireless is the founding
member of the WirelessReady(TM) Alliance, a partnership of industry-leading
hardware, software, and service companies committed to the delivery of complete
and compelling wireless data solutions. For more information on Sierra Wireless,
visit our web site at www.sierrawireless.com.
"AirCard" and "WirelessReady" are registered trademarks of Sierra Wireless, Inc.
All other trademarks or service marks in this news release are the trademarks or
service marks of their respective owners.
Conference Call and Instant Replay
We will host a conference call to review our results on July 17, 2003 at 2:30 PM
PDT, 5:30 PM EDT. To participate in this conference call, please dial the
following toll free number approximately five minutes prior to the commencement
of the call:
1-888-458-1598 Passcode: 38226#
Should you be unable to participate, Instant Replay will be available for three
business days following the conference call by dialing:
1-877-653-0545 Passcode: 175600#
We look forward to having you participate in our call.
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