Powerwave Technologies Reports Fourth Quarter, Year End Results
IRVINE, Calif.--(BUSINESS WIRE)--Jan. 18, 2000--Powerwave Technologies Inc. (NASDAQ: PWAV) Tuesday reported net sales of $91.1 million for its
fourth quarter ended Jan. 2, 2000, which is more than double the revenues of $40 million for the prior year's fourth quarter ended Jan. 3, 1999.
This represents the largest quarterly revenues in Powerwave's history. Powerwave also reported fourth quarter net income of $8.4 million, or diluted earnings per
share of 40 cents for its fiscal fourth quarter of 1999, compared with a net loss of $7.2 million for the prior year's fourth quarter ended Jan. 3, 1999. The prior year's
net loss included a one-time charge of $12.4 million related to an allocation of a portion of the purchase price to in-process research and development expenses
associated with Powerwave's October 1998 acquisition of Hewlett-Packard Company's RF power amplifier business. The prior year's fourth quarter net loss
equated to a diluted loss per share of 42 cents.
Total revenues for all of fiscal year 1999 were $292.5 million, which compares with $100.2 million for the 1998 fiscal year. Powerwave also reported total net
income of $20.3 million for the 1999 fiscal year ended Jan. 2, 2000, which equates to diluted earnings per share of 98 cents. This compares with an annual net loss
of $3.0 million or diluted loss per share of 17 cents for fiscal year 1998, which also included the one-time charge of $12.4 million related to the allocation to
in-process research and development expenses. For fiscal 1998, excluding the one-time charge related to the allocation to in-process research and development
expenses, Powerwave would have reported net income of approximately $4.9 million and diluted earnings per share of 29 cents.
"We are extremely proud of our fourth quarter and year-end results and we look forward to the opportunities that await Powerwave in the new year," stated Bruce
C. Edwards, president and chief executive officer. "For the fourth quarter, Powerwave once again recorded record revenues and our total 1999 revenues were over
$292 million. This represents an increase of almost three times our total 1998 revenues of $100 million. I believe that today Powerwave is in a leadership position in
the radio frequency power amplifier market with one of the largest product portfolios as well as the most diversified customer base of any independent RF power
amplifier manufacturer."
For the fourth quarter of 1999, North American revenues were $57 million or approximately 63% of revenues as compared with $24.8 million or approximately
62% of revenues for the fourth quarter of 1998. Total sales to customers based in Asia accounted for approximately 24% of revenues or $22 million for the fourth
quarter of 1999 compared with 18% of revenues or $7.2 million for the fourth quarter of 1998. Total european and other international revenues for the fourth
quarter of 1999 were $12.1 million or approximately 13% of revenues as compared with $8.0 million or approximately 20% of revenues for the fourth quarter of
1998.
For all of fiscal year 1999, North American revenues were $195.3 million or approximately 67% of revenues as compared with $59 million or approximately 59%
of revenues for fiscal 1998. Total sales to customers based in Asia accounted for approximately 21% of revenues or $62.2 million for fiscal 1999 compared with
30% of revenues or $30.2 million for fiscal 1998. Total european and other international revenues for 1999 were $35.1 million or approximately 12% of revenues as
compared with $11 million or approximately 11% of revenues for 1998.
Powerwave's customer diversification continued in the fourth quarter of 1999 with Lucent Technologies accounting for approximately 10% of revenues, Ericsson
Inc. accounting for over 10% of revenues and Nortel Networks Corp. accounting for approximately 35% of revenues.
Balance Sheet
At Jan. 2, 2000, Powerwave had total cash and cash equivalents of approximately $76.7 million. Total assets were approximately $224.0 million with net inventories
of $31.7 million and net accounts receivable of $47.5 million.
Company Background
Powerwave Technologies Inc., an ISO 9001 quality certified company, is a leading supplier of high performance RF power amplifiers for use in wireless
communications networks. Powerwave designs, manufacturers and markets both single carrier and multi-carrier RF power amplifiers. Powerwave's products are
utilized in both cellular and PCS base stations in both digital and analog networks. Powerwave also produces RF power amplifiers for the wireless local loop market.
Corporate headquarters are located at 2026 McGaw Avenue, Irvine, Calif., 92614. Telephone: 949/757-0530 or 949/809-1100. For more information on
Powerwave's high performance ultra-linear RF power amplifiers and amplifier systems, call 888/PWR-WAVE (797-9283) or visit the company's Web site at
www.Powerwave.com.
Conference Call
A playback of Powerwave's fourth quarter financial results
conference call will be available beginning at approximately 4:00 p.m.
PDT on Jan. 18, 2000 through Jan. 22, 2000 by calling 800/633-8284 or
858/812-6460 and entering reservation number 14143143.
Forward-Looking Statements
Statements contained in this news release which are not historical information are forward-looking statements as defined within the Private Securities Litigation
Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties which could cause our actual results to differ materially from those
projected or implied. Such potential risks and uncertainties include, but are not limited to, in no particular order: dependence on a limited number of customers;
reductions or cancellations in orders from new or existing customers; continued or new deterioration of business and economic conditions in our customers'
marketplaces, including international marketplaces such as South Korea and South America; our intensely competitive industry which has increasing price
competition and the resulting negative impact on gross margins; variability in gross margins on our new products and the resulting impacts on operating results; our
continued success in the design of new amplifier products and redesign of our existing amplifier products and our ability to manufacture in quantity such new products
as well as obtain qualification from our customers of such new or redesigned products; continued favorable business conditions and growth in the wireless
communications market; and dependence on certain of our suppliers for single-sourced components. Powerwave also notes that its reported financial performance
and period-to-period comparisons are not necessarily indicative of the results that may be expected in the future and Powerwave believes that such comparisons
cannot be relied upon as indicators of future performance. Powerwave also notes that the market price of its Common Stock has exhibited high levels of volatility
and therefore may not be suitable for all investors. More detailed information on these and additional factors which could affect the company's operating and financial
results are described in the company's Form 10-K for the fiscal year ended January 3, 1999 and the company's Form 10-Q for the quarterly period ended October
3, 1999, both of which are filed with the Securities and Exchange Commission, and other risks detailed from time to time in the company's reports filed or to be filed
with the Securities and Exchange Commission. Powerwave urges all interested parties to read these reports to gain a better understanding of the many business and
other risks that the company faces. Additionally, the company undertakes no obligation to publicly release the results of any revisions to these forward-looking
statements which may be made to reflect events or circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events.
Powerwave Technologies Inc.
Consolidated Statements of Operations
(in thousands, except per share amounts)
Three Months Ended Years Ended
(unaudited) (audited)
Jan. 2, Jan. 3, Jan. 2, Jan. 3,
2000 1999 2000 1999
Net Sales $91,130 $40,026 $292,547 $100,231
Cost of Sales 64,244 28,997 210,305 66,056
Gross Profit 26,886 11,029 82,242 34,175
Operating Expenses:
Sales and Marketing 4,570 3,191 15,179 9,533
Research and
Development 7,268 4,627 26,250 13,472
General and
Administrative 3,279 2,002 12,088 5,771
In-Process Research
and Development -- 12,400 -- 12,400
Total Operating
Expenses 15,117 22,220 53,517 41,176
Operating Income
(Loss) 11,769 (11,191) 28,725 (7,001)
Other Income
(Expense) 1,242 (105) 2,846 2,330
Income (Loss) before
Income Taxes 13,011 (11,296) 31,571 (4,671)
Provision (Benefit) for
Income Taxes 4,619 (4,123) 11,306 (1,705)
Net Income (Loss) $8,392 ($7,173) $20,265 ($2,966)
Net Income (Loss)
Per Share (basic): $.42 ($.42) $1.02 ($.17)
(diluted): $.40 ($.42) $.98 ($.17)
Weighted average common
shares used in computing
per share amounts
(basic): 20,131 17,248 19,493 17,178
(diluted): 21,067 17,248 20,224 17,178
Powerwave Technologies Inc.
Percentage of Net Sales
(unaudited)
Three Months Ended Years Ended
Jan. 2, Jan. 3, Jan. 2, Jan. 3,
2000 1999 2000 1999
Statement of Operations Data:
Net Sales 100.0% 100.0% 100.0% 100.0%
Cost of Sales 70.5 72.4 71.9 65.9
Gross Profit 29.5 27.6 28.1 34.1
Operating Expenses:
Sales and
Marketing 5.0 8.0 5.2 9.5
Research and
Development 8.0 11.5 9.0 13.4
General and
Administrative 3.6 5.0 4.1 5.8
In-Process Research
and Development -- 31.0 -- 12.4
Total Operating
Expenses 16.6 55.5 18.3 41.1
Operating Income
(Loss) 12.9 (27.9) 9.8 (7.0)
Other Income
(Expense) 1.4 (0.3) 1.0 2.3
Income (Loss) before
Income Taxes 14.3 (28.2) 10.8 (4.7)
Provision (Benefit) for
Income Taxes 5.1 (10.3) 3.9 (1.7)
Net Income (Loss) 9.2% (17.9)% 6.9% (3.0)%
Powerwave Technologies Inc.
Consolidated Condensed Balance Sheets
(in thousands)
Jan. 2, 2000 Jan. 3, 1999
ASSETS
Current Assets:
Cash and cash equivalents $ 76,671 $ 13,307
Accounts receivable, net 47,476 31,212
Inventories, net 31,696 28,583
Notes receivable 7,045 --
Other current assets 8,337 4,936
Total Current Assets 171,225 78,038
Property and equipment,
net 33,871 20,448
Other assets 18,881 33,499
Total Assets $223,977 $131,985
Liabilities and Shareholders' Equity
Current Liabilities:
Accounts payable $ 30,128 $ 18,667
Accrued expenses and other
liabilities 20,338 13,918
Income taxes payable 3,007 3,715
Current portion of
long-term debt 125 6,528
Total Current Liabilities 53,598 42,828
Long-term debt -- 17,621
Other non-current liabilities 600 466
Total Liabilities 54,198 60,915
Shareholders' Equity:
Common Stock $.0001 par
value 120,785 65,027
Retained earnings 48,994 28,729
Less treasury stock at cost -- (22,686)
Total Shareholders' Equity 169,779 71,070
Total Liabilities and
Shareholders' Equity $223,977 $131,985 |
