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Gold/Mining/Energy : Com Dev International -- Ignore unavailable to you. Want to Upgrade?

To: Wallof Confusion who wrote (202)	3/1/2001 11:24:04 AM
From: Dan Hamilton	Respond to of 216

Well, it seems the market hasn't turned cartwheels over the quarterly results. Guidance doesn't look too bad to me, but then there's a lot of uncertainty out there. I wonder how low CDV can go before it finds support? I sold out in the high $16's just because I thought the overall market was headed to the crapper. Glad I haven't bought back in yet, but I am certainly looking for the bottom... COM DEV Announces First Quarter Results On Track to Achieve Almost 50 Percent Revenue Growth as Forecast, Despite Uncertain Wireless Markets CAMBRIDGE, ON, Feb. 28 /CNW/ - COM DEV International Ltd. (TSE:CDV) today announced results for the first quarter ended January 31, 2001. Steady revenue numbers in COM DEV Wireless, solid growth in COM DEV Space and a successful new wireless systems sales initiative in Africa have led the Company to conclude that, despite lowered 3G sales projections industry-wide, the Company will still achieve strong revenue growth for the year. As expected for the quarter, even after spending $4.7 million in expenses associated with the continued investment in development of M/ERGY(TM), the Company generated a small operating profit prior to finance charges. Looking forward, we anticipate a weaker second quarter prior to returning to strong growth in the third and fourth quarters. For this fiscal year as a whole, we now forecast to break-even from operations, despite ongoing development costs associated with M/ERGY and lowered 3G sales projections. First Quarter Summary Revenue for the first quarter ended January 31, 2001 increased 43% to $60 million compared with $42 million in the first quarter of 2000. After finance charges, the Company recorded a net loss for the first quarter of $0.45 million or one cent per share compared with a net loss of $3.9 million or 12 cents per share in the same period a year ago. Within this total, COM DEV Wireless and COM DEV Space generated revenue of $32.1 million and $27.9 million, respectively. In doing so, COM DEV Wireless revenue grew 22% from $26.4 million and COM DEV Space revenue grew 79% compared to $15.6 million in the first quarter of 2000. Margins for the quarter in both COM DEV Space and COM DEV Wireless were approximately the same at slightly more than 28%. COM DEV Wireless was favourably impacted by higher margins on initial shipments of 3G and wireless systems products. Compared to the first quarter of last year, research and development and selling and general expenses increased due to the M/ERGY product development and the ramp-up of operations in Suzhou. CEO's Assessment "Given the turbulent and uncertain environment in which we are operating today, I believe our results and our prospects for the remainder of the year have held up well," said Keith Ainsworth, CEO of COM DEV. "The anticipated build-out of 3G wireless infrastructure in Europe and the ramp up of full wireless production in Suzhou look like they may be stretched out for several months. However, we took a conservative perspective in generating this year's forecast and this, combined with stronger than previously forecast performance by COM DEV Space and new wireless system sales in Africa, will largely neutralize the impact on our top- line forecast. The qualification of Chinese suppliers and the building of relationships with Chinese customers have proved to be complex. In response to difficulties in China, I have dedicated new executive resources from COM DEV Space to augment the COM DEV Wireless team in China. I continue to believe that in the coming years, China, as the world's largest wireless market, is worth our investment and that it will shortly begin to drive more significant revenue growth in COM DEV Wireless. The rapidly changing 3G market assessment took us by surprise as it did the rest of the world. However, I believe we are in a better position than most to deal with it. Having been through the process of introducing new systems before, we took a conservative approach in forecasting and preparing for the new 3G business. Third Generation cellular is still expected to emerge as a major new global market, albeit somewhat further in the future than was considered to be the case even a month ago. In the interim, it seems likely that our 2G and 2.5G products will get a larger and longer run than we previously anticipated. The uncertainty of the 3G market may also make the fractional cost of deploying M/ERGY compared to 3G systems and its ability to instantly reach a broad spectrum of new customers without need of new third party applications even more appealing to spectrum license holders." Highlights of the first quarter: - As previously announced and discussed with Q4 2000 results, COM DEV Wireless concluded a US$100 million order to provide UMTS 3G cellular subsystems for installation in Europe, and COM DEV Space announced a $31 million order covering 14 satellites. - COM DEV Wireless concluded a supplier agreement with Electronics Manufacturing Group (EMG) of Calgary for outsourcing its surface mounted circuit board production, a move that will both reduce costs and increase product reliability. - COM DEV Wireless received a commitment for $1.1 million in financial support in the form of a forgivable loan from the Province of New Brunswick to help defray the cost of training 200 new employees to be added as the 3G market grows. - Pat Mathis, a respected Washington-based expert in assessing global strategic communications trends, joined COM DEV's board of Directors. In addition, since the first quarter closed: - COM DEV was added to the S&P/TSE Information Technology Index. - The Company concluded a strategic partnership with California-based Alpine PCS. Alpine PCS will work with COM DEV to conduct M/ERGY trials and has the option of becoming one of the first M/ERGY customers in the USA. - COM DEV concluded an agreement with Canada's Export Development Corporation and the Afrexim Bank in Cairo under which the banks will provide US $15 million in financing to a new customer in Lagos, Nigeria to support the customer's purchase of COM DEV Wireless products. Further information will be announced as soon as all the contract details have been concluded.