CalAmp Reports Fiscal 2014 First Quarter Results

CalAmp Reports Fiscal 2014 First Quarter Results 
OXNARD, CA -- (Marketwired) -- 06/27/13 --  CalAmp Corp. (NASDAQ:
CAMP), a leading provider of wireless products, services and
solutions, today reported results for its first quarter ended May 31,
2013. Highlights for the quarter include: 


 
--  Consolidated first quarter revenue of $53.7 million, up 22.5% compared
    to the first quarter last year with Wireless Datacom revenue up 29%
    over prior year first quarter to $40.9 million.
--  First quarter GAAP net income of $1.7 million, or $0.05 per diluted
    share, compared to $4.2 million, or $0.14 per diluted share for the
    first quarter last year.
--  Adjusted Basis (non-GAAP) net income of $5.6 million, or $0.16 per
    diluted share, compared to $5.3 million, or $0.18 per diluted share,
    for the same period last year.
--  Net cash provided by operations for the first quarter of $5.8 million,
    and total cash balance at May 31, 2013 of $24.5 million.

  
Commenting on the first quarter results, Michael Burdiek, CalAmp's
President and Chief Executive Officer said, "We're off to a strong
start in fiscal 2014. In the first quarter, our Wireless Datacom
segment revenue increased 29% year-over-year driven by continued
momentum from our Mobile Resource Management (MRM) products and
contributions from our Wireless Matrix acquisition that was completed
at the beginning of the first quarter. The Wireless Datacom gross
margin improved to 39.1% due mainly to higher margin subscription
revenue from our Wireless Matrix acquisition. In addition, rapid
progress on the integration front during the first quarter resulted
in lower than expected operating expenses from the acquired
operations of Wireless Matrix. In our Satellite segment, we saw
improving margins along with some growth resulting in a meaningful
impact to our bottom line results. We believe our unique hardware,
software and service portfolio, supported by expanding channel
partnerships with global reach, has given us the leverage to win an
increasing share of Machine-to-Machine (M2M) market opportunities as
they emerge." 
Fiscal 2014 First Quarter Results
 Total revenue for the fiscal 2014
first quarter was $53.7 million compared to $43.9 million for the
first quarter of fiscal 2013, an increase of 22.5%.
 Wireless Datacom
revenue increased to $40.9 million from $31.7 million in the same
period last year, and Satellite revenue was $12.9 million compared to
$12.2 million in the first quarter last year. 
Consolidated gross profit for the fiscal 2014 first quarter was $18.5
million, an increase of $4.8 million over the same quarter last year
that was primarily driven by higher revenue. The consolidated gross
margin was 34.4% in the fiscal 2014 first quarter, up from 31.2% in
the first quarter last year. The increase in consolidated gross
margin reflects the higher proportion of total revenues represented
by the Wireless Datacom segment in fiscal 2014 versus the prior year
and, within Wireless Datacom, the shift in revenue mix toward higher
margin subscription-based revenues associated with the Wireless
Matrix acquisition. 
GAAP net income for the fiscal 2014 first quarter was $1.7 million,
or $0.05 per diluted share, compared to net income of $4.2 million,
or $0.14 per diluted share, in the first quarter of last year. The
lower GAAP net income is due in part to the elimination of
substantially all of the Company's deferred income tax asset
valuation allowance at the end of fiscal 2013 that caused GAAP basis
income tax expense to revert to a level that reflects full statutory
tax rates beginning in the first quarter of fiscal 2014. Despite
this, on a cash basis, the Company's pretax income is still largely
sheltered from taxation by net operating loss (NOL) carryforwards,
and is expected to remain so for the next few years.  
Non-GAAP net income for the fiscal 2014 first quarter was $5.6
million, or $0.16 per diluted share, compared to non-GAAP net income
of $5.3 million, or $0.18 per diluted share, for the same quarter
last year. Non-GAAP earnings exclude the impact of intangibles
amortization, stock-based compensation and acquisition-related
expenses, and include income tax expense that reflects cash taxes
paid for the period after giving effect to the utilization of NOL and
tax credit carryforwards. A reconciliation of the GAAP-basis pretax
income to the non-GAAP net income and earnings per diluted share is
provided in the table at the end of this press release.  
Liquidity 
As of May 31, 2013, the Company had total cash of $24.5 million and
an outstanding bank term loan of $4.8 million. Net cash provided by
operating activities during the first quarter was $5.8 million, and
the unused borrowing capacity on the bank revolver as of the end of
the first quarter was $10.2 million. 
Business Outlook
 Commenting on the Company's business outlook, Mr.
Burdiek said, "Based on our latest projections, we expect fiscal 2014
second quarter consolidated revenues to be in the range of $53 to $57
million. We anticipate that Wireless Datacom second quarter revenues
will be up moderately on a sequential basis and up significantly
year-over-year. We expect Satellite second quarter revenues to be
down slightly on a sequential basis, but up year-over-year. At the
bottom line, we expect second quarter GAAP basis net income in the
range of a $0.04 to $0.08 per diluted share, and non-GAAP net income
in the range of $0.14 to $0.18 per diluted share. Looking further
ahead, we continue to expect that the second half of fiscal 2014 will
be stronger than the first half of the year, as several previously
announced opportunities as well as recently launched products begin
ramping up, and we realize the full benefit of synergies from our
Wireless Matrix acquisition." 
Conference Call and Webcast
 A conference call and simultaneous
webcast to discuss first quarter results and business outlook will be
held today at 4:30 p.m. Eastern / 1:30 p.m. Pacific. CalAmp's
President and CEO Michael Burdiek and CFO Rick Vitelle will host the
conference call. Participants can dial into the live conference call
by calling 1-877-407-0784 (1-201-689-8560 for international callers)
and using the Conference ID # 416358. An audio replay will be
available through July 4, 2013 by calling 1-877-870-5176 or
1-858-384-5517 and entering the Conference ID # 416358. 
Additionally, a live webcast of the call will be available on
CalAmp's web site at www.calamp.com. Participants are encouraged to
visit the web site at least 15 minutes prior to the start of the call
to register, download and install any necessary audio software. After
the live webcast, a replay will remain available until the next
quarterly conference call in the Investor Relations section of
CalAmp's web site.  
About CalAmp
 CalAmp Corp. (NASDAQ: CAMP) is a proven leader in
providing wireless communications solutions to a broad array of
vertical market applications and customers. CalAmp's extensive
portfolio of intelligent communications devices, robust and scalable
cloud service platform, and targeted software applications streamline
otherwise complex M2M deployments. These solutions enable customers
to optimize their operations by collecting, monitoring and
efficiently analyzing business critical data and desired intelligence
from high-value fixed and mobile remote assets. For more information,
please visit www.calamp.com. 
Forward-Looking Statements 
 Statements in this press release that
are not historical in nature are forward-looking statements that
involve kn
own and unknown risks and uncertainties. Words such as
"may", "will", "expect", "intend", "plan", "believe", "seek",
"could", "estimate", "judgment", "targeting", "should", "anticipate",
"goal" and variations of these words and similar expressions, are
intended to identify forward-looking statements. Actual results could
differ materially from those implied by such forward-looking
statements due to a variety of factors, including product demand,
competitive pressures and pricing declines in the Company's wireless
and satellite markets, the timing of customer approvals of new
product designs, intellectual property infringement claims, the
effects of the automatic federal budget cuts required pursuant to the
sequester that took effect on March 1, 2013, interruption or failure
of our Internet-based systems used to wirelessly configure and
communicate with the tracking and monitoring devices that we sell,
integration issues that may arise in connection with the Wireless
Matrix acquisition that was consummated on March 4, 2013, and other
risks or uncertainties that are described in the Company's Annual
Report on Form 10-K that was filed on April 25, 2013 with the
Securities and Exchange Commission. Although the Company believes the
expectations reflected in such forward-looking statements are based
upon reasonable assumptions, it can give no assurance that its
expectations will be attained. The Company undertakes no obligation
to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. 


 
                                                                            
                                                                            
                               CAL AMP CORP.                                
                       CONSOLIDATED INCOME STATEMENTS                       
             (Unaudited, in thousands except per share amounts)             
                                                                            
                                                     Three Months Ended     
                                                           May 31,          
                                                 -------------------------- 
                                                     2013          2012     
                                                 ------------  ------------ 
                                                                            
Revenues                                         $     53,746  $     43,861 
                                                                            
Cost of revenues                                       35,265        30,185 
                                                 ------------  ------------ 
                                                                            
Gross profit                                           18,481        13,676 
                                                 ------------  ------------ 
                                                                            
Operating expenses:                                                         
  Research and development                              5,158         3,172 
  Selling                                               4,985         2,808 
  General and administrative                            3,812         3,098 
  Intangible asset amortization                         1,649           317 
                                                 ------------  ------------ 
                                                       15,604         9,395 
                                                 ------------  ------------ 
                                                                            
Operating income                                        2,877         4,281 
                                                                            
Non-operating expense, net                               (169)          (90)
                                                 ------------  ------------ 
                                                                            
Income before income taxes                              2,708         4,191 
                                                                            
Income tax provision                                   (1,023)           (9)
                                                 ------------  ------------ 
                                                                            
Net income                                       $      1,685  $      4,182 
                                                 ============  ============ 
                                                                            
Earnings per share:                                                         
  Basic                                          $       0.05  $       0.15 
  Diluted                                        $       0.05  $       0.14 
                                                                            
Shares used in computing earnings per share:                                
  Basic                                                34,566        27,925 
  Diluted                                              35,663        29,263 
                                                                            
                        BUSINESS SEGMENT INFORMATION                        
                         (Unaudited, in thousands)                          
                                                     Three Months Ended     
                                                           May 31,          
                                                 -------------------------- 
                                                     2013          2012     
                                                 ------------  ------------ 
Revenues                                                                    
  Wireless DataCom                               $     40,865  $     31,671 
  Satellite                                            12,881        12,190 
                                                 ------------  ------------ 
                                                                            
    Total revenues                               $     53,746  $     43,861 
                                                 ============  ============ 
                                                                            
Gross profit                                                                
  Wireless DataCom                               $     15,960  $     11,745 
  Satellite                                             2,521         1,931 
                                                 ------------  ------------ 
                                                                            
    Total gross profit                           $     18,481  $     13,676 
                                                 ============  ============ 
                                                                            
Operating income (loss)                                                     
  Wireless DataCom                               $      2,366  $      4,391 
  Satellite                                             1,548         1,
080 
  Corporate expenses                                   (1,037)       (1,190)
                                                 ------------  ------------ 
                                                                            
    Total operating income                       $      2,877  $      4,281 
                                                 ============  ============ 
                                                                            
                                                                            
                                                                            
                               CAL AMP CORP.                                
                        CONSOLIDATED BALANCE SHEETS                         
                               (In thousands)                               
                                                                            
                                                    May 31,    February 28, 
                                                     2013          2013     
                                                 ------------  ------------ 
                     Assets                       (Unaudited)               
Current assets:                                                             
  Cash and cash equivalents                      $     24,495  $     63,101 
  Accounts receivable, net                             25,501        19,111 
  Inventories                                          12,443        13,516 
  Deferred income tax assets                            6,858         6,400 
  Prepaid expenses and other current assets             5,449         4,641 
                                                 ------------  ------------ 
    Total current assets                               74,746       106,769 
Property, equipment and improvements, net               4,448         2,778 
Deferred income tax assets, less current portion       33,166        34,616 
Goodwill                                               18,304         1,112 
Other intangible assets, net                           28,574         4,603 
Other assets                                            1,156           893 
                                                 ------------  ------------ 
                                                                            
                                                 $    160,394  $    150,771 
                                                 ============  ============ 
                                                                            
      Liabilities and Stockholders' Equity                                  
Current liabilities:                                                        
  Current portion of long-term debt              $      2,145  $      2,261 
  Accounts payable                                     15,882        11,871 
  Accrued payroll and employee benefits                 4,199         5,298 
  Deferred revenue                                      6,626         6,410 
  Other current liabilities                             4,203         3,109 
                                                 ------------  ------------ 
                                                                            
    Total current liabilities                          33,055        28,949 
                                                 ------------  ------------ 
Long-term debt                                          5,409         2,434 
Other non-current liabilities                           1,990         1,839 
                                                                            
Stockholders' equity:                                                       
  Common stock                                            351           350 
  Additional paid-in capital                          203,073       202,368 
  Accumulated deficit                                 (83,419)      (85,104)
  Accumulated other comprehensive loss                    (65)          (65)
                                                 ------------  ------------ 
                                                                            
    Total stockholders' equity                        119,940       117,549 
                                                 ------------  ------------ 
                                                                            
                                                 $    160,394  $    150,771 
                                                 ============  ============ 
                                                                            
                                                                            
                                                                            
                               CAL AMP CORP.                                
                     CONSOLIDATED CASH FLOW STATEMENTS                      
                         (Unaudited - In thousands)                         
                                                                            
                                                     Three Months Ended     
                                                           May 31,          
                                                 -------------------------- 
                                                     2013          2012     
                                                 ------------  ------------ 
Cash flows from operating activities:                                       
  Net income                                     $      1,685  $      4,182 
  Depreciation and amortization                         2,067           537 
  Stock-based compensation expense                        631           858 
  Amortization of debt issue costs and discount            88            41 
  Deferred tax assets, net                                992             - 
  Changes in operating working capital                    321        (2,423)
                                                 ------------  ------------ 
                                                                            
    Net cash provided by operating activities           5,784         3,195 
                                                 ------------  ------------ 
                                                                            
Cash flows from investing activities:                                       
  Capital expenditures                                   (404)         (435)
  Navman Wireless asset purchase agreement                  -        (1,000)
  Wireless Matrix acquisition, net of cash                                  
   acquired                                           (46,837)            - 
  Collections on note receivable                            -           140 
                                                 ------------  ------------ 
                                                                            
    Net cash used in investing activities             (47,241)       (1,295)
                                                 ------------  ------------ 
                                                                            
Cash flows from financing activities:                                       
  Proceeds from bank term loan                          5,000             - 
  Debt repayments                                      (2,224)         (200)
  Taxes paid related to net share settlement of                             
   vested equity awards                                  (258)          (92)
  Proceeds from exercise of stock options and                               
   warrants                                               333           106 
                                                 ------------  ------------ 
                                                                            
    Net cash provided (used) by financing                                 
  
     activities                                         2,851          (186)
                                                 ------------  ------------ 
                                                                            
Net change in cash and cash equivalents               (38,606)        1,714 
                                                                            
Cash and cash equivalents at beginning of period       63,101         5,601 
                                                 ------------  ------------ 
                                                                            
Cash and cash equivalents at end of period       $     24,495  $      7,315 
                                                 ============  ============ 
                                                                            
                                                                            
                                                                            
                                CAL AMP CORP.                               
                      NON-GAAP EARNINGS RECONCILIATION                      
                                 (Unaudited)                                

 
"GAAP" refers to financial information presented in accordance with
U.S. Generally Accepted Accounting Principles. This press release
includes historical non-GAAP financial measures, as defined in
Regulation G promulgated by the Securities and Exchange Commission.
CalAmp believes that its presentation of historical non-GAAP
financial measures provides useful supplementary information to
investors. The presentation of historical non-GAAP financial measures
is not meant to be considered in isolation from or as a substitute
for results prepared in accordance with GAAP.  
In this press release, CalAmp reports the non-GAAP financial measures
of Adjusted Basis Net Income and Adjusted Basis Net Income Per
Diluted Share. CalAmp uses these non-GAAP financial measures to
enhance the investor's overall understanding of the financial
performance and future prospects of CalAmp's core business
activities. Specifically, CalAmp believes that a report of Adjusted
Basis Net Income and Adjusted Basis Net Income Per Diluted Share
provides consistency in its financial reporting and facilitates the
comparison of results of core business operations between its current
and past periods.  
The reconciliation of the GAAP Basis Pretax Income to Adjusted Basis
(non-GAAP) Net Income is as follows (in thousands except per share
amounts):  


 
                                                                            
                                                     Three Months Ended     
                                                           May 31,          
                                                 -------------------------- 
                                                     2013          2012     
                                                 ------------  ------------ 
                                                                            
GAAP basis pretax income                         $      2,708  $      4,191 
                                                                            
Amortization of intangible assets                       1,649           317 
Stock-based compensation expense                          631           858 
Acquisition and integration expenses                      637             - 
                                                                            
                                                 ------------  ------------ 
Pretax income (non-GAAP basis)                          5,625         5,366 
                                                                            
Income tax provision (non-GAAP basis) (a)                 (32)          (59)
                                                                            
                                                 ------------  ------------ 
Adjusted Basis net income                        $      5,593  $      5,307 
                                                 ============  ============ 
                                                                            
Adjusted Basis net income per diluted share      $       0.16  $       0.18 
                                                                            
Weighted average common shares outstanding on                               
 diluted basis                                         35,663        29,263 
                                                                            
(a) The non-GAAP income tax provision represents cash taxes paid for the    
    period after giving effect to the utilization of net operating loss and 
    tax credit carryforwards.                                               

  
AT CALAMP:
Garo Sarkissian
SVP Corporate Development
(805) 987-9000 
AT ADDO COMMUNICATIONS:
Lasse Glassen
(424) 238-6249
lasseg@addocommunications.com 
 
 
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