Vari-L Company, Inc. Announces Record Results for Second Quarter and
Six-Month Period
Net Income Increases 63% in Second Quarter and 91% Through Six Months
DENVER, July 22 /PRNewswire/ -- Vari-L Company, Inc. (Nasdaq: VARL - news), a leading provider of advanced
components for the wireless telecommunications industry, today announced record results for the second quarter and
six-month period ended June 30, 1998.
Second quarter net income advanced 63% to $652,000, or 12 cents per basic share and 11 cents per diluted share,
compared with net income of $400,000, or 10 cents per basic share and 9 cents per diluted share, in the second quarter of
1997. Net sales rose 8% to $4,331,000 in the quarter from $4,005,000 in the comparable quarter last year.
Through the first six months of 1998, net income increased 91% to $1,232,000, or 23 cents per basic share and 21 cents per
diluted share, compared with net income of $644,000, or 16 cents per basic and diluted share, through the first six months of
1997. Net sales for the six-month period were up 15% to $8,376,000 versus net sales of $7,305,000 in the comparable
period a year ago.
Dave Sherman, president and CEO, said, ''Our consistent record of sales and earnings growth illustrates the strength of
Vari-L's diverse product lines. We are especially pleased with the significant increase in net income, which reflects improved
margins resulting from successful efforts to refine and automate production processes.''
Through both the second quarter and first half of 1998, gross margins increased to 55% from 49% in the comparable periods
last year.
The Company entered the third quarter with a backlog of $14.4 million, an increase of approximately $1 million from this time
last year. Customer orders through the first six months of 1998 were $6.1 million versus $6.3 million in the first six months of
1997. Commercial markets continued to drive order flow during the period, accounting for a total of $4.6 million compared
with $1.5 million from military/aerospace markets. Domestic orders for the period were $4.6 million and international orders
totaled $1.5 million.
Customer orders in the second quarter totaled $2.2 million as compared with $3.2 million in the same quarter last year when
the Company received two large, multi-year orders from key domestic customers. Commercial orders for the quarter
accounted for $1.4 million while military/aerospace orders were approximately $800,000. Domestic orders were $1.5 million
and international orders were $700,000.
''Multi-year orders can make a quarter look better than it is or worse than it is, depending upon when the order is booked,''
Sherman explained. ''That is the nature of our business and why we like to focus more on annual results, which are typically a
more accurate and meaningful measure of our company's performance.''
Sherman also noted, ''Despite short-term uncertainty in the telecommunications industry as a result of Asian economic unrest,
we remain committed to growing the Company through expansion into both consumer and international markets. We are
convinced demand for our wireless communications products will continue to grow over the long term regardless of any
current economic pressures.''
Through its headquarters in Denver, Vari-L designs, manufactures and markets a wide range of radio frequency (RF) and
microwave signal processing components used in the wireless communications industry for both commercial and military
applications. Vari-L serves a diverse customer base comprised of some of the world's leading technology companies, including
Ericsson, Hughes, IBM, Lockheed Martin, Lucent Technologies, Magnavox, Mitsubishi, Motorola, NEC, Nokia, Northern
Telecom, QUALCOMM, Raytheon, Samsung, and Texas Instruments.
Some of the statements contained in this news release are forward-looking statements. The accuracy of these statements
cannot be guaranteed as they are subject to a variety of risks, including but not limited to the success of the products into
which the Company's products are integrated, governmental action relating to wireless communications licensing and
regulation, internal projections as to the demand for certain types of technological innovation, competitive products and pricing,
the success of new product development efforts, the timely release for production and the delivery of products under existing
contracts, future economic conditions generally, as well as other factors. |
