Echelon Reports Second Consecutive Quarterly Operating Profit, 119% Revenue Growth
$0.07 EPS Beats Street Estimates
SAN JOSE, Calif.--(BUSINESS WIRE)--April 11, 2002--Echelon Corporation (Nasdaq:ELON - news) today announced financial results for the quarter ended March 30, 2002, exceeding analysts' expectations by about $0.01 per share.
``We are very pleased with our results this quarter,'' said M. Kenneth Oshman, Echelon's chairman and chief executive officer. ``While the sluggish world economy continues to put pressure on our core business, we completed our seventh consecutive profitable quarter and earned our second consecutive quarterly operating profit. Our business with Enel S.p.A. continues to go well with over 700,000 LonWorks® enabled electric meters installed to date. Although we don't foresee any near-term change in the economic climate, we continue to believe that this will be an exciting, profitable, growth year.''
Revenues for the quarter ended March 31, 2002 were $27.6 million, an increase of 119% over revenues of $12.6 million for the same period in 2001. Net profit for the quarter ended March 31, 2002 was $2,687,000, or $0.07 cents per share, based on a fully diluted weighted average of 41,085,000 common shares outstanding, compared to a net profit of $22,000, or $0.00 cents per share, based on a fully diluted weighted average of 40,916,000 common shares outstanding for the same period in 2001. Gross margin for the quarter ended March 31, 2002 was 51.0%, compared with 61.9% for the same period in 2001. Total operating expenses for the quarter ended March 31, 2002 were $12.2 million, compared to $10.0 million for the same period in 2001. Operating expenses for the quarter ended March 31, 2002 included a one-time in-process R&D charge of $400,000 related to our acquisition of BeAtHome.com, Inc.
In addition to strong financial performance, the quarter included a number of important events as highlighted below:
Echelon announced and completed the acquisition of BeAtHome.com, Inc., adding a great group of people to our team and bringing an important new services platform to Echelon. We believe that, in time, this new services platform will help speed the adoption and deployment of LonWorks based monitoring and control solutions by utilities, businesses, and factories worldwide and, at the same time, create new on-going revenue opportunities for Echelon.
Echelon announced an expanded relationship with Fuji Electric that we expect will strengthen our position in the industrial automation market.
Echelon announced an agreement with the National Joint Apprenticeship and Training Committee (NJATC), the training program of the National Electrical Contractors Association (NECA) and the International Brotherhood of Electrical Workers (IBEW), to jointly market, advertise, promote, and deliver LonWorks training classes to IBEW and NECA members. We believe that a pool of talented, well trained, LonWorks savvy electricians and contractors will help expand and accelerate our growth in the North American buildings market.
At a recent investor conference in Italy, Enel S.p.A. indicated that it is on track to reach an installation-rate of 1 million meters per month later this year, at which point Enel's monthly installations will be larger than the entire customer base of many US utilities.
For those interested in further discussion regarding this release, Echelon's management will participate in a conference call today at 2:00 pm PST. To access the conference call, dial 1-800-388-8975 (callers outside the US please use +1-973-694-2225); however, due to a limited number of available phone lines, the company asks that only those persons without Web access call this number. The call will be available live today, and for playback on the Investor Relations section of Echelon's web site (www.echelon.com) through April 19th, 2002.
About Echelon Corporation
Echelon Corporation is the creator of the LonWorks platform, the world's most widely used standard for connecting everyday devices such as appliances, thermostats, air conditioners, electric meters, and lighting systems to each other and to the Internet. Echelon's hardware and software products enable manufacturers and integrators to create smart devices and systems that lower cost, increase convenience, improve service, and enhance productivity, quality, and safety. Thousands of companies have developed and installed more than 18 million LonWorks based devices into homes, buildings, factories, trains, and other systems worldwide.
The protocol underlying LonWorks networks and the signaling used by Echelon's power line and free topology transceivers have been adopted as standards by the American National Standards Institute (ANSI). Echelon is a founding member of the LonMark® Interoperability Association, an open industry forum of hundreds of leading manufacturers, integrators, and users dedicated to promoting the use of interoperable LonWorks devices. More information about LonMark interoperability is available at lonmark.org. Further information regarding Echelon can be found at echelon.com.
Echelon, LonWorks, LonMark, and the Echelon logo are trademarks of Echelon Corporation registered in the United States and other countries. Other marks belong to their respective holders.
This press release may contain statements relating to future plans, events or performance. Such statements may involve risks and uncertainties, including risks associated with uncertainties pertaining to the risks that the R&D activities or subsequent product deployment activities with Enel are not successful, do not meet their target dates, do not expand or gain momentum, or are terminated, or that the contemplated transactions are challenged by third parties, risks that our acquisition of BeAtHome, our expanded relationship with Fuji Electric, or our agreement with the NJATC regarding LonWorks training does not yield desired results, risks that our development projects with other parties are not successful, risks relating to the development of markets for Echelon's products and services and the ability of those products and services to meet customer and consumer expectations, and other risks identified in Echelon's SEC filings. Actual results, events and performance may differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Echelon undertakes no obligation to release publicly the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
The financial statements that follow should be read in conjunction with the notes set forth in Echelon's Form 10-Q when filed with the Securities and Exchange Commission and with our 2001 annual report on Form 10-K which was filed with the Securities and Exchange Commission in March 2002. |
