$106.6 Million in 2015 Revenue
PCTEL, Inc. (NASDAQ:PCTI), a leader in Performance
Critical Telecom solutions, announced its 2015 fourth
quarter and annual results.
Fourth Quarter and Annual
Highlights
- $26.1 million in revenue for the
quarter, a decrease of 11 percent from the same period last
year. $106.6 million in revenue for the year, a decrease of a half
percent as compared to 2014.
- Gross profit margin of 34 percent in
the quarter compared to 40 percent for the same period last
year. Gross profit margin of 35 percent for the year, compared to
41 percent in 2014.
- GAAP operating margin of negative
seven percent for the quarter compared to operating margin of
six percent for the same period last year. Operating margin for the
year of negative five percent as compared to four percent in
2014.
- GAAP net loss of $820,000 for the
quarter, or $(0.05) per diluted share compared to net income of
$2.0 million, or $0.11 per diluted share for the same period last
year. $(1.6) million of net loss for the year, or $(0.09) per
diluted share, as compared to net income of $4.6 million, or $0.25
per diluted share in 2014.
- 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 three
percent in the quarter, compared to 12 percent in the same
period last year. Non-GAAP operating margin for the year was two
percent compared to 10 percent in 2014.
- Non-GAAP net income of $611,000 or
$0.04 per diluted share in the quarter, compared to $3.0
million or $0.16 per diluted share in the same period last year.
Non-GAAP net income of $1.9 million or $0.11 per diluted share for
the year compared to $8.8 million or $0.48 per diluted share in
2014.
- $31.8 million of cash and short-term
investments at December 31, 2015, a decrease of approximately
$2.5 million from the preceding quarter and a decrease of $28.2
million from 2014.
- 449,000 common shares repurchased in
the quarter for $2.4 million. 1.94 million common shares
repurchased in the year for $12.1 million.
- $881,000 dividends paid in the
quarter and $3.7 million paid in the year.
- $869,000 of free cash flow in the
quarter. $7.1 million of free cash flow in the year, an
increase of $1.7 million from 2014.
“We made significant progress over the previous quarter led by
strength in antenna and scanning receiver sales in North America,”
said Marty Singer, PCTEL’s Chairman and CEO. “During the fourth
quarter we also began to restructure our analytics and services
operations, bringing in new leadership and sharpening our product
focus on PCTEL’s traditional areas of strength. We believe that
these efforts will lead to improved results in the second half of
this year,” added Singer.
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:
55187834. 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:
55187834.
About PCTEL
PCTEL, a global provider of RF expertise, delivers
Performance Critical Telecom solutions to the
wireless industry. PCTEL benchmarks and optimizes wireless networks
with its data tools, engineering services, and RF products. PCTEL's
antennas and site solutions are vital elements for networks serving
SCADA, fleet management, health care, public safety, and
education.
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®® Touch, SeeHawk®®
Collect, and SeeWave®® tools. PCTEL's sophisticated engineering
services utilize these products as well as SeeHawk™ Analytics.
PCTEL Connected Solutions designs and delivers
performance critical antennas and site solutions for public and
private wireless networks globally. PCTEL's performance critical
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 leverage our
design, logistics, and support capabilities to deliver performance
critical antenna and site solutions into carrier, railroad, utility
applications, oil and gas, and other vertical markets.
PCTEL's products are sold worldwide through direct and indirect
channels. For more information, please visit the company's web
sites: pctel.com, antenna.com, or rfsolutions.pctel.com
PCTEL Safe Harbor Statement
This press release and our related comments in our third quarter
earnings conference call contain “forward-looking statements” as
defined in the Private Securities Litigation Reform Act of 1995.
Specifically, the statements regarding our future financial
performance, new products and features, expectations regarding the
future growth of our antenna and wireless RF businesses, and demand
for engineering services 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.
PCTEL, INC. CONSOLIDATED BALANCE SHEETS (in
thousands, except share data) December 31,
December 31, 2015 2014 ASSETS
Cash and cash equivalents $7,055 $20,432 Short-term
investment securities 24,728 39,577 Accounts receivable, net of
allowance for doubtful accounts of $314 and $121 at December 31,
2015 and December 31, 2014, respectively 21,001 23,874 Inventories,
net 17,596 16,358 Deferred tax assets, net 0 2,281 Prepaid expenses
and other assets 1,586 1,757 Total current assets 71,966 104,279
Property and equipment, net 13,839 14,842 Goodwill 3,332 161
Intangible assets, net 11,378 2,637 Deferred tax assets, net 13,155
9,710 Other noncurrent assets 40 40
TOTAL ASSETS
$113,710 $131,669 LIABILITIES AND
STOCKHOLDERS’ EQUITY Accounts payable $6,735 $5,495
Accrued liabilities 6,190 10,211 Total current liabilities 12,925
15,706 Other long-term liabilities 388 448
Total liabilities 13,313 16,154 Stockholders’ equity: Common
stock, $0.001 par value, 100,000,000 shares authorized, 17,654,236
and 18,571,419 shares issued and outstanding at December 31, 2015
and December 31, 2014, respectively 18 19 Additional paid-in
capital 135,714 145,462 Accumulated deficit (35,320) (30,101)
Accumulated other comprehensive income (loss) (15) 135 Total
stockholders’ equity 100,397 115,515
TOTAL LIABILITIES
AND STOCKHOLDERS' EQUITY $113,710 $131,669
PCTEL, INC. CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (unaudited) (in thousands, except per share
data) Three Months Ended
Year Ended December 31, December 31,
2015 2014 2015 2014
REVENUES $26,138 $29,395 $106,615 $107,164
COST OF
REVENUES 17,287 17,634 69,354 63,577
GROSS
PROFIT 8,851 11,761 37,261 43,587
OPERATING
EXPENSES: Research and development 2,699 2,766 11,205 11,736
Sales and marketing 3,639 3,649 14,196 12,961 General and
administrative 2,887 2,997 12,399 12,819 Amortization of intangible
assets 461 464 3,426 1,967 Impairment of goodwill 161 0 161 0
Restructuring charges 778 0 1,630 0 Total operating
expenses 10,625 9,876 43,017 39,483
OPERATING
INCOME (LOSS) (1,774 ) 1,885 (5,756 ) 4,104 Other income, net
504 927 3,287 1,666
INCOME (LOSS) BEFORE INCOME
TAXES (1,270 ) 2,812 (2,469 ) 5,770 Expense (benefit) for
income taxes (450 ) 817 (901 ) 1,158
NET INCOME (LOSS) ($820
) $1,995 ($1,568 ) $4,612
Net Income (Loss) per
Share: Basic ($0.05 ) $0.11 ($0.09 ) $0.25 Diluted ($0.05 )
$0.11 ($0.09 ) $0.25
Weighed Average Shares: Basic
16,820 18,154 17,737 18,159 Diluted 16,820 18,412 17,737 18,389
Cash dividend per share $0.05 $0.04 $0.20 $0.16
PCTEL,
INC. P&L INFORMATION BY SEGMENT (unaudited) (in
thousands)
Three Months Ended December 31, 2015 Year Ended
December 31, 2015
Connected
Solutions
RF
Solutions
Corporate Total
Connected
Solutions
RF
Solutions
Corporate Total
REVENUES $16,675 $9,506 ($43 )
$26,138 $69,579 $37,255 ($219 ) $106,615
GROSS PROFIT 4,838 4,000
13 8,851 20,426 16,803 32 37,261
OPERATING INCOME (LOSS) $675 ($8 )
($2,441 ) ($1,774 ) $5,040 ($298 ) ($10,498 ) ($5,756 )
Three Months Ended December 31, 2014 Year Ended December 31,
2014
Connected
Solutions
RF
Solutions
Corporate Total
Connected
Solutions
RF
Solutions
Corporate Total
REVENUES $19,924 $9,535 ($64 )
$29,395 $72,333 $35,113 ($282 ) $107,164
GROSS PROFIT 6,183 5,572
6 11,761 22,818 20,743 26 43,587
OPERATING INCOME (LOSS) $2,078 $2,184
($2,377 ) $1,885 $7,357 $7,333 ($10,586 )
$4,104
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 December 31, Year Ended
December 31, 2015 2014
2015 2014 Operating
Income (Loss) ($1,774 ) $1,885 ($5,756 ) $4,104 (a) Add:
Amortization of intangible assets -Cost of Goods Sold 595 0 595 0
-Operating expenses 461 464 3,426 1,967 Impairment of goodwill 161
0 161 0 Restructuring: -Cost of Goods Sold 42 0 288 0
-Restructuring 778 0 1,630 0 TelWorx investigation: -General &
Administrative 7 580 107 1,266 Legal settlement: -General &
Administrative 0 0 0 75 Stock Compensation: -Cost of Goods Sold 125
111 369 426 -Engineering 175 150 419 658 -Sales & Marketing
(132 ) 170 238 661 -General & Administrative 304 267
838 1,530 2,516 1,742 8,071 6,583
Non-GAAP Operating Income $742 $3,627
$2,315 $10,687 % of revenue 2.8 % 12.3 % 2.2 %
10.0 %
Reconciliation of
GAAP net loss to non-GAAP net income (b)
Three Months Ended December 31, Year Ended
December 31, 2015 2014
2015 2014 Net Income
(Loss) ($820 ) $1,995 ($1,568 ) $4,612 Adjustments: (a)
Non-GAAP adjustment to operating income 2,516 1,742 8,071 6,583 (b)
Other income related to SEC investigation of TelWorx (1 ) (908 )
(102 ) (1,568 ) (b) Legal Settlement - Amendment to Nexgen APA (500
) 0 (3,160 ) 0 (b) Legal Settlement - other 0 0 0 (75 ) (b) Income
Taxes (584 ) 161 (1,322 ) (770 ) 1,431 995 3,487 4,170
Non-GAAP Net Income $611 $2,990
$1,919 $8,782
Non-GAAP Earning per
Share: Basic $0.04 $0.16 $0.11 $0.48 Diluted $0.04 $0.16 $0.11
$0.48
Weighed Average Shares: Basic 16,820 18,154
17,737 18,159 Diluted 16,969 18,412 18,257 18,389
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, legal
settlements, and non-cash income tax expense.
Reconciliation of
GAAP To non-GAAP SEGMENT INFORMATION (unaudited) (a)
(in thousands except per share information)
Three Months Ended December 31, 2015 Year Ended
December 31, 2015
Connected
Solutions
RF
Solutions
Corporate Total
Connected
Solutions
RF
Solutions
Corporate Total
Operating Income
(Loss) $675 ($8 ) ($2,441 ) ($1,774 ) $5,040 ($298 ) ($10,498 )
($5,756 ) Add: Amortization of intangible assets
-Cost of Goods Sold 39 556 0 595 39 556 0 595 -Operating expenses
156
305
0
461
811
2,615
0
3,426
Impairment of goodwill 0 161 0 161 0 161 0 161 TelWorx
investigation: -General & Administrative 0 0 7 7 0 0 107 107
Restructuring: -Cost of Goods Sold 42 0 0 42 288 0 0 288
-Restructuring charges 755 23 0 778 1,293 337 0 1,630 Stock
Compensation: -Cost of Goods Sold 28 97 0 125 82 287 0 369
-Engineering 49 126 0 175 104 315 0 419 -Sales & Marketing 88
(220 ) 0 (132 ) 261 (23 ) 0 238 -General & Administrative (18 )
70 252 304 (12 ) 113 737 838
1,139 1,118 259 2,516 2,866 4,361 844 8,071
Non-GAAP Operating
Income (Loss) $1,814 $1,110 ($2,182 ) $742
$7,906 $4,063 ($9,654 ) $2,315
Three Months Ended December 31, 2014 Year Ended December 31, 2014
Connected
Solutions
RF
Solutions
Corporate Total
Connected
Solutions
RF
Solutions
Corporate Total
Operating Income (Loss) $2,078
$2,184 ($2,377 ) $1,885 $7,357 $7,333 ($10,586 ) $4,104 Add:
Amortization of intangible assets 260 204 0 464 1,151 816 0 1,967
TelWorx investigation: -General & Administrative 0 0 580 580 0
0 1,266 1,266 Legal settlement: -General & Administrative 0 0 0
0 0 0 75 75 Stock Compensation: -Cost of Goods Sold 58 53 0 111 215
211 0 426 -Engineering 64 86 0 150 292 366 0 658 -Sales &
Marketing 129 41 0 170 530 131 0 661 -General & Administrative
54 31 182 267 256 129
1,145 1,530 565 415 762 1,742 2,444 1,653 2,486 6,583
Non-GAAP
Operating Income (Loss) $2,643 $2,599 ($1,615 )
$3,627 $9,801 $8,986 ($8,100 ) $10,687
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.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160307006494/en/
PCTEL, Inc.John Schoen, 630-372-6800CFOorJack Seller,
630-372-6800Public RelationsJack.seller@pctel.com
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