Signal Technology Announces Anticipated Third-Quarter Results
DANVERS, Mass.--(BUSINESS WIRE)--Oct. 16, 2001--Signal Technology Corporation (Nasdaq: STCO), a leading provider of electronics and power management products for wireless communications in the commercial, defense and space markets, today announced that it expects lower-than-anticipated third-quarter results.
"Signal's defense electronics business continues to be strong and profitable, but the slowdown in global commercial wireless markets was sharper than we had expected in the third quarter," said George Lombard, chairman and chief executive officer. "Consequently, we now expect revenues for the quarter ended September 30, 2001 to be approximately $20.5 million, resulting in an after-tax loss of approximately $0.46 per share, after the effect of an inventory charge. In addition, the Company is booking a reserve against deferred tax assets of approximately $0.75 per share."
"The global downturn in wireless telecom infrastructure investment intensified, and the U.S. wireless competitive local exchange carrier
("CLEC") market remained at a standstill during the third quarter," Lombard said. "Given the resulting erosion of our commercial wireless revenue base and the current uncertainties as to when this market will begin to rebound, we are setting aside reserves for certain inventories including work-in-process associated with early-stage deliveries of certain commercial wireless products. On an after-tax basis, this third-quarter inventory charge should amount to approximately $0.35 per share."
Lombard continued, "Looking farther ahead, we believe that Signal's strengths in commercial wireless broadband technology position us to be a major participant when these markets resume their long-term growth. In addition, the outlook for our defense business remains positive. It is generally expected that, in the mid- to long-term, U.S. defense spending will be increased with emphasis on electronic systems and related platform upgrades. Near term, we expect continuing profitability from Signal's defense business as several of our recent design wins begin to evolve into production contracts during the coming months."
Signal Technology Corporation expects to report its third-quarter financial results on October 25, 2001 |
