PCTI PCTEL Inc

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (date of earliest event reported) May 5, 2015

 

 

PCTEL, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware		000-27115		77-0364943
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

471 Brighton Drive

Bloomingdale, Illinois 60108

(Address of Principal Executive Offices, including Zip Code)

(630) 372-6800

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12(b))

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

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Item 2.02

Results of Operations and Financial Condition

The following information is intended to be furnished under Item 2.02 of Form 8-K, “Results of Operations and Financial Condition.” This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

On May 5, 2015, PCTEL, Inc. issued a press release regarding its financial results for its first fiscal quarter ended March 31, 2015. The full text of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

 

Item 9.01

Financial Statements and Exhibits

 

(d)

Exhibits.

 

99.1	Press release, dated May 5, 2015, of PCTEL, Inc. announcing its financial results for its first fiscal quarter ended March 31, 2015.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: May 5, 2015

						PCTEL, INC.
				By:		/s/ John W. Schoen
						John W. Schoen, Chief Financial Officer

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EXHIBIT INDEX

 

Exhibit Number		Description
Exhibit 99.1		Press release, dated May 5, 2015, of PCTEL, Inc. announcing its financial results for its first fiscal quarter ended March 31, 2015.

Exhibit 99.1

 

PCTEL Achieves $26.3 Million in First Quarter Revenue

An Increase of 11 Percent from the Same Period Last Year

BLOOMINGDALE, IL. – May 5, 2015 – PCTEL, Inc. (NASDAQ:PCTI), a leader in Performance Critical Telecom solutions, announced its 2015 first quarter results.

First Quarter Highlights

$26.3 million in revenue for the quarter, an increase of 11 percent from the same period last year. $1.2 million of the increase reflected revenue from our most recent acquisition. Organic growth was six percent.

Gross profit margin of 39 percent in the quarter, compared to 41 percent for the same period last year.

GAAP operating margin of just under break even for the quarter, compared to operating margin of negative two percent for the same period last year.

GAAP net loss of $33,000 for the quarter, or $(0.00) per diluted share, compared to a net loss of $146,000, or $(0.01) per diluted share for the same period last year.

Non-GAAP operating profit and net income are measures the company uses to reflect the results of its core earnings. The Company’s reporting of non-GAAP net income excludes expenses for restructuring, gain or loss on sale of assets, stock based compensation, amortization and impairment of intangible assets and goodwill related to the Company’s acquisitions, and non-cash related income tax expense.

Non-GAAP operating margin of four percent in the quarter, compared to five percent in the same period last year. The first quarter 2015 incurred expenses for the Nexgen acquisition totaling three percent of revenue.

Non-GAAP net income of $904,000 or $0.05 per diluted share in the quarter, compared to $914,000 or $0.05 per diluted share in the same period last year. The first quarter 2015 incurred expenses for the Nexgen acquisition totaling $0.03 per share.

$38.9 million of cash and short-term investments at March 31, 2015, a decrease of approximately $21.1 million from the preceding quarter. During the quarter the Company used $20.5 million of cash for the Nexgen acquisition and $929,000 for the regular quarterly dividend, and generated $278,000 of cash and investments from all other sources.

“While pleased with year-over-year-growth, we had anticipated stronger engineering services and continued strength in antenna and mobile tower sales into the oil and gas industry,” said Marty Singer, PCTEL’s Chairman and CEO. “Fortunately, we have seen a rebound in spending on engineering services, positive market reaction to the IBflex^® and SeeWave™, and stronger broadband wireless antenna sales to our major OEMs, and the benefit of our recent acquisition,” added Singer.

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CONFERENCE CALL / WEBCAST

PCTEL’s management team will discuss the Company’s results today at 5:15 PM ET. The call can be accessed by dialing (877) 734-5369 (U.S. / Canada) or (706) 679-6397 (International), conference ID: 13775110. The call will also be webcast at http://investor.pctel.com/events.cfm.

REPLAY: A replay will be available for two weeks after the call on either the website listed above or by calling (855) 859-2056 (U.S./Canada), or International (404) 537-3406, conference ID: 13775110.

About PCTEL

PCTEL delivers Performance Critical Telecom solutions. The industry relies upon PCTEL to benchmark network performance, analyze trends, and optimize wireless networks. PCTEL’s antennas and site solutions are vital elements for SCADA, oil and gas, utilities, fleet management, health care, public safety, education, small cell, and network timing.

PCTEL’s RF Solutions products and services improve the performance of wireless networks globally. PCTEL’s performance critical products include its MXflex™, IBflex^®, and EXflex^® SeeGull^® scanning receivers and related SeeHawk^® and SeeWave™ tools. PCTEL’s sophisticated engineering services utilize these products as well as the Meridian™ network analytics portfolio (Map IQ, Network IQ, and Subscriber IQ).

PCTEL Connected Solutions™ designs and delivers performance critical antennas and site solutions for wireless networks globally. PCTEL’s performance critical MAXRAD^® and Bluewave™ antenna solutions include high rejection and high performance GPS and GNSS products, the industry leading Yagi portfolio, mobile and indoor LTE, broadband, and LMR antennas and PIM-rated antennas for transit, in-building, and small cell applications. We provide performance critical mobile towers for demanding emergency and oil and gas network applications and leverage our design, logistics, and support capabilities to deliver performance critical site solutions into carrier, railroad, and utility applications.

PCTEL’s products are sold worldwide through direct and indirect channels. For more information, please visit the company’s web sites: www.pctel.com, www.antenna.com, or www.rfsolutions.pctel.com.

PCTEL Safe Harbor Statement

This press release contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Specifically, the statements regarding the demand for engineering services, sales of certain RF Solutions products and the benefit of the most recent acquisition are forward-looking statements within the meaning of the safe harbor. These statements are based on management’s current expectations and actual results may differ materially from those projected as a result of certain risks and uncertainties, including the customer demand for these types of products and services generally, PCTEL’s ability to successfully grow the wireless products business, and its ability to implement new technologies and obtain protection for the related intellectual property. These and other risks and uncertainties are detailed in PCTEL’s Securities and Exchange Commission filings. These forward-looking statements are made only as of the date hereof, and PCTEL disclaims any obligation to update or revise the information contained in any forward-looking statement, whether as a result of new information, future events or otherwise.

# # #

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For further information contact:

 

John Schoen		Jack Seller
CFO		Public Relations
PCTEL, Inc.		PCTEL, Inc.
(630) 372-6800		(630) 372-6800
		Jack.seller@pctel.com

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PCTEL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

 

		(unaudited) March 31, 2015				December 31, 2014
ASSETS
Cash and cash equivalents		$	7,917			$	20,432
Short-term investment securities			30,941				39,577
Accounts receivable, net of allowance for doubtful accounts of $107 and $121 at March 31, 2015 and December 31, 2014, respectively			24,318				23,874
Inventories, net			17,704				16,358
Deferred tax assets, net			2,301				2,281
Prepaid expenses and other assets			2,121				1,757
Total current assets			85,302				104,279
Property and equipment, net			14,655				14,842
Goodwill			5,598				161
Intangible assets, net			13,044				2,637
Deferred tax assets, net			9,710				9,710
Other noncurrent assets			38				40
TOTAL ASSETS		$	128,347			$	131,669
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable		$	5,895			$	5,495
Accrued liabilities			6,818				10,211
Total current liabilities			12,713				15,706
Other long-term liabilities			437				448
Total liabilities			13,150				16,154
Stockholders’ equity:
Common stock, $0.001 par value, 100,000,000 shares authorized, 18,714,202 and 18,571,419 shares issued and outstanding at March 31, 2015 and December 31, 2014, respectively			19				19
Additional paid-in capital			146,110				145,462
Accumulated deficit			(31,063	)			(30,101	)
Accumulated other comprehensive income			131				135
Total stockholders’ equity			115,197				115,515
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY		$	128,347			$	131,669

 

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PCTEL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(in thousands, except per share data)

 

		Three Months Ended March 31,
		2015				2014
REVENUES		$	26,326			$	23,656
COST OF REVENUES			16,137				14,074
GROSS PROFIT			10,189				9,582
OPERATING EXPENSES:
Research and development			2,738				3,242
Sales and marketing			3,530				2,956
General and administrative			3,363				3,232
Amortization of intangible assets			654				574
Total operating expenses			10,285				10,004
OPERATING LOSS			(96	)			(422	)
Other income, net			44				197
LOSS BEFORE INCOME TAXES			(52	)			(225	)
Benefit for income taxes			(19	)			(79	)
NET LOSS		($	33	)		($	146	)
Loss per Share:
Basic		($	0.00	)		($	0.01	)
Diluted		($	0.00	)		($	0.01	)
Weighed Average Shares:
Basic			18,312				18,176
Diluted			18,312				18,176
Cash dividend per share		$	0.05			$	0.04

 

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PCTEL, INC.

P&L INFORMATION BY SEGMENT (unaudited)

(in thousands)

 

		Three Months Ended March 31, 2015
		Connected Solutions				RF Solutions				Corporate				Total
REVENUES		$	17,354			$	9,051			($	79	)		$	26,326
GROSS PROFIT			5,444				4,736				9				10,189
OPERATING INCOME (LOSS)		$	1,613			$	1,210			($	2,919	)		($	96	)

 

		Three Months Ended March 31, 2014
		Connected Solutions				RF Solutions				Corporate				Total
REVENUES		$	15,997			$	7,722			($	63	)		$	23,656
GROSS PROFIT			5,116				4,459				7				9,582
OPERATING INCOME (LOSS)		$	1,170			$	1,014			($	2,606	)		($	422	)

 

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Reconciliation of GAAP to non-GAAP Results (unaudited)

(in thousands except per share information)

Reconciliation of GAAP operating loss to non-GAAP operating income (a)

 

		Three Months Ended March 31,
		2015				2014
Operating Loss		($	96	)		($	422	)
(a) Add:
Amortization of intangible assets			654				574
TelWorx investigation:
-General & Administrative			38				235
Stock Compensation:
-Cost of Goods Sold			73				86
-Engineering			115				173
-Sales & Marketing			158				147
-General & Administrative			155				345
			1,193				1,560
Non-GAAP Operating Income		$	1,097			$	1,138
% of revenue			4.2	%			4.8	%

Reconciliation of GAAP net loss to non-GAAP net income (b)

 

		Three Months Ended March 31,
		2015				2014
Net Loss		($	33	)		($	146	)
Adjustments:
(a) Non-GAAP adjustment to operating income			1,193				1,560
Other income related to SEC investigation of TelWorx			(38	)			(220	)
(b) Income Taxes			(218	)			(280	)
			937				1,060
Non-GAAP Net Income		$	904			$	914
Non-GAAP Earning per Share:
Basic		$	0.05			$	0.05
Diluted		$	0.05			$	0.05
Weighed Average Shares:
Basic			18,312				18,176
Diluted			18,525				18,379

This schedule reconciles the Company’s GAAP operating loss and GAAP net loss to its non-GAAP operating income and non-GAAP net income. The Company believes that presentation of this schedule provides meaningful supplemental information to both management and investors that is indicative of the Company’s core operating results and facilitates comparison of operating results across reporting periods. The Company uses these non-GAAP measures when evaluating its financial results as well as for internal planning and forecasting purposes. These non-GAAP measures should not be viewed as a substitute for the Company’s GAAP results.

(a) These adjustments reflect stock based compensation expense, amortization of intangible assets, restructuring charges, and general and administrative expenses associated with the SEC investigation of TelWorx.

(b) These adjustments include the items described in footnote (a) as well as other income for insurance claims related to the SEC investigation of TelWorx, and non-cash income tax expense.

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Reconciliation of GAAP To non-GAAP SEGMENT INFORMATION (unaudited) (a)

(in thousands except per share information)

 

		Three Months Ended March 31, 2015
		Connected Solutions				RF Solutions				Corporate				Total
Operating Income (Loss)		$	1,613			$	1,210			($	2,919	)		($	96	)
Add:
Amortization of intangible assets			230				424				0				654
TelWorx investigation:
-General & Administrative			0				0				38				38
Stock Compensation:
-Cost of Goods Sold			36				37				0				73
-Engineering			46				69				0				115
-Sales & Marketing			103				55				0				158
-General & Administrative			25				19				111				155
			440				604				149				1,193
Non-GAAP Operating Income (Loss)		$	2,053			$	1,814			($	2,770	)		$	1,097

 

		Three Months Ended March 31, 2014
		Connected Solutions				RF Solutions				Corporate				Total
Operating Income (Loss)		$	1,170			$	1,014			($	2,606	)		($	422	)
Add:
Amortization of intangible assets			370				204				0				574
TelWorx investigation:
-General & Administrative			0				0				235				235
Stock Compensation:
-Cost of Goods Sold			46				40				0				86
-Engineering			80				93				0				173
-Sales & Marketing			128				19				0				147
-General & Administrative			86				30				229				345
			710				386				464				1,560
Non-GAAP Operating Income (Loss)		$	1,880			$	1,400			($	2,142	)		$	1,138

This schedule reconciles the Company’s GAAP operating income (loss) by segment to its non-GAAP operating income. The Company believes that presentation of this schedule provides meaningful supplemental information to both management and investors that is indicative of the Company’s core operating results and facilitates comparison of operating results across reporting periods. The Company uses these non-GAAP measures when evaluating its financial results as well as for internal planning and forecasting purposes. These non-GAAP measures should not be viewed as a substitute for the Company’s GAAP results.

(a) These adjustments reflect stock based compensation expense, amortization of intangible assets, restructuring charges, and general and administrative expenses associated with the SEC investigation of TelWorx.