Powerwave Technologies Reports Second Quarter Results
IRVINE, Calif. - Jul. 12, 2001 -
Powerwave Technologies, Inc. (NASDAQ:PWAV) today reported net sales of
$78.2 million for its second quarter ended July 1, 2001, compared to
second quarter fiscal 2000 revenues of $110.5 million. The Company
reported a $5.2 million sequential increase in sales over the first
quarter ended April 1, 2001. Powerwave also reported a second quarter
net loss of $2.4 million, or a basic loss per share of 4 cents for its
fiscal second quarter, compared to a net loss of $9.5 million or a basic
loss per share of 15 cents reported for the first quarter ended April
1, 2001. For the second quarter fiscal 2000, the Company previously
reported net income of $11.4 million, or diluted earnings per share of
18 cents.
"As we previously announced, during the second quarter
we experienced continued lower demand for the majority of our 2G single
carrier products coupled with continued weakness in the network
operator market," stated Bruce C. Edwards, President and Chief Executive
Officer. "We believe that the global economic slowdown is contributing
to the slowdown in the wireless communications sector which is
continuing to create slowdowns and delays in purchasing decisions at the
network operator level which has also led to purchasing delays at the
OEM level."
"During the second quarter we continued to focus on
building and expanding both our customer base and product lines. Near
the end of the second quarter, we announced the finalization of our
supply agreement with Motorola for high powered multi-carrier amplifiers
for their SC4812T cellular base stations. Powerwave now has supply
agreements in place with four of the top five base station OEM's for our
high powered cellular band multi-carrier products. In addition, during
the second quarter our newest product area, amplifiers for the emerging
3G W-CDMA market, continued to grow sequentially and accounted for
approximately 23% of our second quarter revenues."
For the
second quarter of 2001, North American revenues were $33.1 million or
approximately 42% of revenues as compared to $92.1 million or
approximately 83% of revenues for the second quarter of 2000. Total
sales to customers based in Asia accounted for approximately 31% of
revenues or $24.2 million for the second quarter of 2001. This compares
to 6% of revenues or $7.1 million for the second quarter of 2000. Total
European and other international revenues for the second quarter of 2001
were $20.9 million or approximately 27% of revenues as compared to
$11.3 million or approximately 10% of revenues for the second quarter of
2000.
Powerwave's customer diversification for the second
quarter of 2001 includes LGIC and Samsung Electronics each accounting
for at least 10% of revenues and Nortel Networks Corporation accounting
for approximately 45% of revenues. In addition, our total sales to
network operators accounted for approximately 15% of revenues in the
second quarter of 2001.
Balance Sheet
At
July 1, 2001, Powerwave had total cash and cash equivalents of
approximately $99.2 million. Total assets were approximately $367.5
million with net inventories of $61.1 million and net accounts
receivable of $63.2 million.
Company Background
Powerwave Technologies, Inc., a TL 9000 and ISO 9001 quality
certified company, is a leading supplier of high performance RF power
amplifiers for use in wireless communications networks. Powerwave
designs, manufactures and markets both single carrier and multi-carrier
RF power amplifiers for use in cellular, PCS and 3G base stations
throughout the world. Corporate headquarters are located at 1801 E. St.
Andrew Place, Santa Ana, Calif. 92705. Telephone (714) 466-1000. For
more information on Powerwave's high performance ultra-linear RF power
amplifiers and amplifier systems, please call (888)-PWR-WAVE (797-9283)
or visit our web site at www.powerwave.com. Powerwave and Powerwave
Technologies are registered trademarks of Powerwave Technologies, Inc.
and the Powerwave logo is a trademark of Powerwave Technologies, Inc.
Conference
Call
Powerwave is providing a simultaneous Webcast of its
Fiscal 2001 second quarter financial results conference call on
Thursday, July 12, 2001, at 2:00 PM Pacific Time. To access this audio
Webcast, log onto www.themeetingson.com and select "Web Conferencing."
Next, select "Join a Web Conference" and under Webcast, select "Access
Your Webcast Now." The reservation number of the Powerwave Fiscal 2001
second quarter financial results conference call is 19309611. The call
will last for approximately 1 hour. A replay of the Webcast will be
available beginning approximately 1 hour after completion of the initial
Webcast . Additionally, an audio playback of Powerwave's first quarter
financial results conference call will be available beginning at
approximately 4:00pm PDT on July 12, 2001 through July 19, 2001 by
calling (800) 633-8284 or (858) 812-3440 and entering reservation number
19309611.
Forward-Looking Statements
The
foregoing statements regarding growth possibilities associated with
deployment of 3G systems; our ability to benefit from the expected
growth in demand for multi-carrier 2G and 3G products; and the
possibility of delays in deployments of 2G and 3G wireless networks are
"forward looking statements." All of these statements are subject to
risks and uncertainties which could cause our actual results to differ
materially from those projected or implied. Such potential risks and
uncertainties include, but are not limited to, in no particular order:
delays in deployment of 3G systems by wireless OEM's and delays in
acceptance of 3G systems by network operators; unexpected technical
difficulties in developing 3G products; we require continued success in
the design of new amplifier products and such products must be
manufacturable and of good quality and reliability; our dependence on
single source suppliers for certain key components used in our
amplifiers exposes us to potential material shortages; variability in
our gross margins on new products which could result in a negative
impact on our operating results; the ramp up of new production lines
incurs many additional costs and if customer demand for such new
products is not large enough, such costs may have a negative impact on
our operating results; our business requires continued favorable
business conditions and growth in the wireless communications market.
Powerwave also notes that its reported financial performance and period
to period comparisons are not necessarily indicative of the results that
may be expected in the future and Powerwave believes that such
comparisons cannot be relied upon as indicators of future performance.
Powerwave also notes that the market price of its Common Stock has
exhibited high levels of volatility and therefore may not be suitable
for all investors. More detailed information on these and additional
factors which could affect Powerwave's operating and financial results
are described in the Company's Form 10-K for the fiscal year ended
December 31, 2000 and the Company's Form 10-Q for the period ended April
1, 2001, both of which are filed with the Securities and Exchange
Commission, and other risks detailed from time to time in the Company's
reports filed with the Securities and Exchange Commission. Powerwave
urges all interested parties to read these reports to gain a better
understanding of the many business and other risks that the Company
faces. Additionally, Powerwave undertakes no obligation to publicly
release the results of any revisions to these forward-looking statements
which may be made to reflect events or circumstances occurring after
the date hereof or to reflect the occurrence of unanticipated events.
###
POWERWAVE TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
Three Months Ended Six Months Ended
(unaudited) (unaudited)
July 1, July 2, July 1, July 2,
2001 2000 2001 2000
Net Sales $78,248 $110,458 $151,224 $214,312
Cost of Sales 67,910 74,504 136,293 145,901
Gross Profit 10,338 35,954 14,931 68,411Operating Expenses:
Sales and Marketing 3,602 5,382 8,578 10,447
Research and Development 8,359 10,627 19,256 19,635
General and Administrative 3,426 3,622 9,584 7,207
Total Operating Expenses 15,387 19,631 37,418 37,289Operating Income (Loss) (5,049) 16,323 (22,487) 31,122
Other Income, net 1,332 1,332 3,878 2,542
Income (Loss) before
Income Taxes (3,717) 17,655 (18,609) 33,664
Provision (Benefit)
for Income Taxes (1,338) 6,267 (6,699) 11,950Net Income (Loss) ($2,379) $11,388 ($11,910) $21,714
Net Income (Loss) per Share
(diluted): ($.04) $.18 ($.19) $.34
(basic): ($.04) $.19 ($.19) $.36Weighted Average Common
Shares used in Computing
per Share Amounts (diluted): 64,061 64,784 63,879 64,534
(basic): 64,061 61,332 63,879 61,134
POWERWAVE TECHNOLOGIES, INC.
Percentage of Net Sales
(unaudited)Three Months Ended Six Months Ended
(unaudited) (unaudited)
July 1, July 2, July 1, July 2,
2001 2000 2001 2000
Statement of Operations Data:
Net Sales 100.0% 100.0% 100.0% 100.0%
Cost of Sales 86.8 67.5 90.1 68.1Gross Profit 13.2 32.5 9.9 31.9
Operating Expenses:
Sales and Marketing 4.6 4.8 5.7 4.9
Research and Development 10.7 9.6 12.7 9.1
General and Administrative 4.4 3.3 6.4 3.4
Total Operating Expenses 19.7 17.7 24.8 17.4Operating Income (Loss) (6.5) 14.8 (14.9) 14.5
Other Income, Net 1.7 1.2 2.6 1.2
Income (Loss) before
Income Taxes (4.8) 16.0 (12.3) 15.7
Provision (Benefit) for
Income Taxes (1.7) 5.7 (4.4) 5.6Net Income (Loss) (3.1)% 10.3% (7.9)% 10.1%
POWERWAVE TECHNOLOGIES, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands)
July 1, 2001 December 31, 2000
(unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 99,190 $128,733
Accounts receivable, net 63,184 80,006
Inventories, net 61,053 51,275
Other current assets 19,075 13,966
Total Current Assets 242,502 273,980Property, plant and equipment, net 109,013 101,658
Other assets 15,997 18,159
Total Assets $367,512 $393,797
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 32,752 $ 50,829
Accrued expenses and other liabilities 21,758 24,023
Income taxes payable - 2,299
Current portion of long-term debt 65 96
Total Current Liabilities 54,575 77,247Long-term debt 36 42
Other non-current liabilities 61 236
Total Liabilities 54,672 77,525Shareholders' Equity:
Total Shareholders' Equity 312,840 316,272
Total Liabilities and Shareholders' Equity $367,512 $393,797
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