Just got this off of the news wire! Sorry so sloppy.
Without charges related to aquisitions it looks like Q4 is .15 and year ended results are .84. What were the estimates? Are these numbers good or bad? Obviously the aquisitions will be taken into consideration.
Glenayre Technologies Reports Fourth Quarter/Year End
1997 Results
PR Newswire - February 11, 1998 18:43
GEMS %CPR %ERN V%PRN P%PRN
CHARLOTTE, N.C., Feb. 11 /PRNewswire/ -- Glenayre Technologies Inc.
(Nasdaq: GEMS) today announced results for the fourth quarter and year ended
Dec. 31, 1997. Results were negatively impacted by one-time charges
totaling $131.2 million related to Glenayre's three 1997 acquisitions and
expensing of business process re-engineering costs previously capitalized.
Net sales for the fourth quarter 1997 increased to $123.6 million or 19%
from $104.2 million for the fourth quarter 1996. The company's loss from
operations totaled $116.7 million for fourth quarter 1997 compared to income
from operations of $19.0 million for the same period in 1996. Results were
negatively impacted during fourth quarter 1997 by a charge of $125.2 million
related to purchased in-process research and development associated with the
Open Development Corp. and Wireless Access Inc. acquisitions, and a charge of
$5.2 million for write-off of goodwill related to the acquisition of CNET Inc.
Exclusive of these adjustments, income from operations in fourth quarter
1997 would have been approximately $13.7 million or $5.3 million lower than
the $19.0 million reported in fourth quarter 1996. The decrease was due to
increased operating costs associated with international operations, increased
selling and general administrative costs to support the growth in enhanced
services products, lower gross margins on international turnkey business and
the mix of lower margin products shipped.
In accordance with the change in accounting principle required by the
November 1997 FASB Emerging Issues Task Force #97-13, the company also
recorded a charge of $0.7 million (net of income tax benefit)
associated with the expensing of business process re-engineering costs
previously capitalized. Earnings per share, affected by each of the one-time
adjustments, decreased to a net loss of $2.01 per share for fourth
quarter 1997 as compared to earnings per share of $0.27 for fourth quarter
1996. Earnings per share before the one-time charges would have been
approximately $0.15 for fourth quarter 1997.
Net sales for the twelve months ended December 31, 1997, increased to
$451.7 million or 16% from $390.2 million reported for the twelve months ended
December 31, 1996. The company's loss from operations totaled $57.8 million
for 1997 compared with $86.1 million in income from operations for 1996.
The results were negatively impacted by a charge for write-off of goodwill
($5.2 million), and a charge for purchased in-process research and development
($125.2 million) as described above.
Exclusive of these adjustments, income from operations would have been
approximately $72.6 million for 1997 compared to $86.1 million in 1996. The
decrease was attributable to lower margins due to product mix and a higher
percentage of international turnkey projects, higher expenses due to increased
activity, and dilution from 1997 acquisitions.
As a result of the change in accounting principle described above, the
company recorded an expense of $0.7 million (net of income tax benefit) in
December 1997. Earnings per share for 1997 decreased to a net loss of $1.29
per share versus net income of $1.11 per share for the twelve months ended
December 31, 1996. Exclusive of the one-time charges, earnings per share for
1997 would have been approximately $0.84.
The company announced that it eliminated approximately 60 research and
development positions in its paging infrastructure group, consolidating two
locations into one. The reductions result from a workforce restructuring
intended to improve operational efficiencies. In further cost cutting, the
company adopted a flexible shortened work week to match capacity to demand for
hourly manufacturing personnel in its Vancouver, British Columbia, facility.
Commenting on the results, President and CEO Gary Smith, said, "During
1997, Glenayre's international sales grew by 47%, although U.S. sales declined
by 5%. As our new products are introduced during 1998, we anticipate gaining
important market position, especially as two-way paging networks and prepaid
wireless/wireline systems gain further acceptance. With the recent increased
activity in system operators' interest in two-way networks, we are
enthusiastic about U.S. market opportunities."
Commenting further on 1998, Smith said, "As we look to 1998 and beyond, I
believe Glenayre is well positioned for growth. Initially, shipments and
earnings will be sequentially down during first quarter 1998. However, we
believe that during the year we will build positive momentum, based upon
several key factors: adoption of two-way paging systems in both the U.S. and
international markets; introduction of our new advanced pager; and continued
strong growth from our enhanced service products."
Glenayre Technologies Inc. is a leader in developing, manufacturing and
marketing innovative personal telecommunications products and systems. With
over 2,000 employees and offices on six continents, Glenayre's net sales were
approximately $452 million in 1997. Glenayre specializes in complete paging
systems, including both one and two-way paging infrastructure, and AccessMate
advanced messaging pagers. Glenayre also offers telecommunication service
providers, both wireless and wireline, a suite of enhanced service products
including voice mail, fax messaging, voice-activated dialing, one-number
services, calling card platforms and communication network administration
software. Glenayre completed the acquisition of Wireless Access Inc., now
known as the company's Wireless Access Group, and Open Development Corp., now
a component of Glenayre's Integrated Network Group, in 4th Quarter 1997.
Additionally, Glenayre provides microwave radio products, hands-on technical
training and comprehensive customer support.
This news release contains statements which may be forward looking within
the meaning of applicable securities laws. The statements may include
projections regarding future earnings results, and are based upon the
company's current expectations and assumptions, which are subject to a number
of risks and uncertainties. Factors that could cause actual results to differ
are discussed in the company's most recently filed Form 10-Q. These factors
may include: potential market changes resulting from rapid technological
advances; introduction and acceptance of NPCS products and systems;
competition; variability of quarterly results; volatility of the company's
stock price; limits on protection of proprietary technologies; potential
changes in government regulation; financing of customer NPCS purchases; and
international business risks.
GLENAYRE TECHNOLOGIES INC.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Fourth Quarter Ended Twelve Months Ended
12/31/97 12/31/96 12/31/97 12/31/96
Net Sales $123,614 $104,211 $451,679 $390,246
Cost of Sales 64,234 51,039 217,793 180,468
Selling, General &
Administrative 27,487 22,202 100,619 80,428
Research & Development 12,242 8,286 40,425 28,983
Depreciation & Amortization 5,977 3,627 20,211 13,482
Charge for Purchased R&D 125,200 -- 125,200 --
Write-off of Goodwill 5,183 -- 5,183 --
Income (Loss) from
Operations (116,709) 19,057 (57,752) 86,885
Interest Income, Net 2,226 2,352 10,350 9,654
Other Income (Expense), Net (1,098) 7 (2,147) 112
Income (Loss) before Income Taxes and
Accounting Change (115,581) 21,416 (49,549) 96,651
Provision for Income Taxes 5,263 4,712 27,855 26,207
Net Income (Loss) before Accounting
Change (120,844) 16,704 (77,404) 70,444
Accounting Change (Net of
Income Tax Benefit) (688) -- (688) --
Net Income (Loss) ($121,532) $16,704 ($78,092) $70,444
Net Income (Loss) per Common Share --
assuming dilution ($2.01) $0.27 ($1.29) $1.11
Number of Shares used to compute
diluted per share data 60,533 61,889 60,323 63,416
BALANCE SHEET DATA
(In thousands)
(Unaudited)
12/31/97 12/31/96
Cash & Short Term Investments $21,076 $131,801
Working Capital 161,454 279,031
Total Assets 505,818 521,210
Stockholders' Equity 408,016 455,861
ESTIMATED SALES BREAKOUTS
(In millions)
(Unaudited)
By Strategic Marketing Unit
Q4 97 YTD 97 Q4 96 YTD 96
Paging
U.S. $39.6 $154.9 $38.2 $191.5
International 58.6 194.0 50.7 145.5
Subtotal 98.2 348.9 88.9 337.0
Integrated Network
U.S. 11.1 41.4 5.4 19.2
International 5.7 29.2 2.2 5.7
Subtotal 16.8 70.6 7.6 24.9
Wireless Interconnect
U.S. 7.0 28.2 6.9 25.2
International 1.5 4.0 0.8 3.1
Subtotal 8.6 32.2 7.7 28.3
Total $123.6 $451.7 $104.2 $390.2
SOURCE Glenayre Technologies Inc.
/CONTACT: Stan Ciepcielinski, Glenayre Technologies Inc., 704-553-0038, or
fax 704-553-7878/
/Company News On-Call: prnewswire.com or fax, 800-758-5804,
ext. 111723/
(GEMS) |
