Vari-L Company Reports Record Sales and Earnings for 1998
Strong Customer Orders, Increased Production Capacity Expected to Drive Continued Growth in 1999
DENVER, Jan. 26 /PRNewswire/ -- Vari-L Company, Inc. (Nasdaq: VARL - news), a leading provider of advanced components for the wireless telecommunications industry, today announced record sales and earnings for its year ended December 31, 1998. In addition, the Company reported that increasing orders from new and existing customers have positioned Vari-L to accelerate growth in 1999.
Net income for 1998 increased 33% to $2,697,000, or 50 cents per basic share and 48 cents per diluted share, compared with net income of $2,035,000, or 45 cents per basic share and 43 cents per diluted share, for 1997. Net sales for the year were $18,063,000 versus net sales of $17,385,000 last year.
Fourth-quarter net income was $715,000, or 13 cents per basic and diluted share, compared with net income of $824,000, or 16 cents per basic share and 15 cents per diluted share, in the fourth quarter of 1997. Net sales for the period were $4,882,000 versus net sales of $5,550,000 in the comparable period a year ago.
Dave Sherman, president and CEO, said, ''We are very pleased to have extended Vari-L's record of year-over-year revenue and earnings growth. While revenue in the fourth quarter was impacted by softening demand and newly-imposed export restrictions in military and aerospace markets, we believe that segment of our business will rebound to former levels. In the meantime, we continue to experience steady demand for our wireless infrastructure product lines and believe the emerging wireless handset market will drive accelerated growth in 1999 and into the new millennium.''
Vari-L entered 1999 with an order backlog of approximately $18.1 million, up 9% from a backlog of $16.6 million at the beginning of 1998. Firm customer orders for 1998 were up 15% to $22.5 million compared with firm customer orders of $19.6 million for 1997. Order flow was strongest in domestic markets, which increased 70% to $16.2 million in 1998, and commercial markets, which increased 22% to $19.6 million.
Sherman noted the following additional fourth-quarter highlights:
- The Company is completing the installation of a high-speed, automated
production line in its state-of-the-art manufacturing facility, allowing
Vari-L to compete for new business in expanding subscriber applications
markets. The new line will give Vari-L the ability to produce an
additional 8 million units annually and the facility can accommodate
several additional lines as demand grows. "Our objective is to leverage
our leading-edge, patented technology and our volume production capacity
to establish Vari-L as the preeminent provider of wireless communications
components," Sherman said.
- Patent protection from the Chinese government for Vari-L's products,
which clears the way for Vari-L to proceed with a sales and distribution
joint venture with a State-run company.
- A $2.2 million sole source provider pact with the Wireless Access group
of Glenayre Technologies. Beginning in the first quarter of 1999, Vari-L
will supply a minimum of 840,000 Voltage Controlled Oscillators for use
in a new messaging device going into production at Wireless Access. This
agreement represents the first significant, high-volume order for the
subscriber marketplace.
- The award of two new U.S. Patents covering breakthrough technology that
enables lower-cost, high-volume production of advanced high-frequency
components formerly manufactured in a high-cost, labor-intensive
environment.
- Through its headquarters in Denver, Vari-L designs, manufactures and
markets a wide range of radio and microwave frequency signal source and
processing components used in the wireless telecommunications 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 California Microwave, Ericsson, Harris, Hughes, IBM,
Lockheed Martin, Lucent Technologies, Mitsubishi, Motorola, NEC, Nokia,
Northrop Grumman, Raytheon, Samsung, Siemens, Stanford Telecom and
Wireless Access. |
