Exhibit 99.1
SYMBOL TECHNOLOGIES REPORTS UNAUDITED 2003
FIRST-QUARTER RESULTS, PROVIDES UPDATE ON
FINANCIAL GUIDANCE AND STATUS OF
RESTATEMENT
HOLTSVILLE, N.Y., April 29, 2003 - Symbol Technologies,
Inc. (NYSE: SBL), a global leader in enterprise mobility
solutions, today announced its unaudited first-quarter results
for the period ending March 31, 2003. These results do not
include any related impact of the Company's planned
restatement of its financial statements previously issued for
the years 1998 through 2002.
Revenue, before the impact of restatement, for the first
quarter ended March 31, 2003, was $357.4 million, compared to
$301.3 million previously reported in the corresponding year-
earlier period, before the impact of restatement. Net
earnings, before the impact of restatement, were $4.8 million,
or $0.02 diluted earnings per share, compared to $1.8 million,
or $0.01 diluted earnings per share, in the previously
reported corresponding year-earlier period, before the impact
of restatement.
The announced first-quarter 2003 net earnings, before the
impact of restatement, included a pre-tax charge of $4.1
million associated with a restructuring of the Global Services
and Support organization and a pre-tax charge of $3.1 million
associated with a writedown of the Company's investment in
AirClic, Inc. Excluding the effects of these restructuring
and impairment charges in order to show the Company's reported
results from ongoing operations, non-GAAP net earnings, before
the impact of restatement, were $9.7 million, or $0.04
diluted earnings per share, compared to non-GAAP net earnings,
which exclude a special compensation charge, of $7.6 million,
or $0.03 diluted earnings per share, in the previously
reported first quarter of 2002, before the impact of
restatement.
As previously reported, the Company has not filed its
Annual Report on Form 10-K for the year ended December 31,
2002, with the Securities and Exchange Commission and is in
the process of restating its financial statements. While the
Company believes it has made substantial progress in improving
controls in its operations and financial reporting, the
restatement is not yet complete. Therefore, these reported
results are not in accordance with accounting principles
generally accepted in the United States, have not been
reviewed by the Company's auditors and will be impacted by the
restatement in that the restatement will have the effect of
rolling back, rolling forward or eliminating certain assets,
liabilities, revenues and expenses that have been
inappropriately reflected in the reported results of the
Company.
"Overall, we were pleased with Symbol's revenue of $357
million in 2003's first quarter even as we faced a continued
very difficult economy with still-slow IT investment and the
U.S. at war. Although we saw balance sheet improvement, we're
not satisfied with earnings at four cents per share before
special charges," Richard Bravman, vice chairman and chief
executive officer, said.
"We continue to see progress on the balance sheet and
succeeded in significantly reducing inventories and accounts
receivable. With ongoing positive cash flow in the quarter, we
improved our liquidity position to nearly $100 million in cash
on the balance sheet and $50 million in short-term bank debt,"
William Nuti, president and chief operating officer, said,
adding, "Our ability to increase year-over-year revenue under
difficult circumstances gives rise to a sense of cautious
optimism regarding our growth potential under improved
business conditions."
Financial guidance
The Company reiterated that in 2003 it anticipates annual
revenue growth in a range of 15 to 20 percent with remaining
quarters improving off the first-quarter base of $357 million,
before the impact of restatement. Due to greater than
anticipated expenses, the Company now expects 2003 earnings
per share in a range of 20 to 26 cents, before the impact of
restatement. Excluding the effects of restructuring and
impairment charges, expected to be approximately $23 million
in fiscal 2003, the Company now expects non-GAAP 2003 earnings
per share from ongoing operations in a range of 27 to 33
cents, before the impact of restatement. The Company had
previously expected non-GAAP earnings of 34 to 42 cents per
share, before special items. Any forward-looking guidance is
subject to updates based on, among other factors, material
changes in the global economic outlook, geopolitical climate
and levels of corporate information technology investment.
The Company has limited visibility to these numbers and there
can be no assurances they will be achieved.
Status of investigations, restatement
The previously reported SEC and Department of Justice
investigations are continuing, and the Company's internal
investigation, undertaken with the assistance of independent
legal counsel and independent auditing firms, is ongoing. The
Company has shared appropriate documentation and discussed
relevant issues with its auditors, who are reviewing them in
connection with the audit of fiscal 2002 results and the
restatement of previously issued financial statements.
"The Symbol board and management team are firmly
committed to coming to proper closure on past financial
issues, addressing them aggressively and thoroughly to ensure
effective controls and processes are put in place to provide a
fully transparent view into our Company's performance so we
can capitalize on the value we are confident is inherent in
our business," Bravman said.
While there can be no guarantee, the Company's goal is to
complete the restatement of its previously issued financial
statements, issue audited results for the year ended December
31, 2002, and file the Company's Annual Report on Form 10-K
with the SEC by June 30, 2003.
Based upon work to date on the restatement, the Company
believes that the reported quarterly results released today
will be impacted; that impact will be disclosed in its
quarterly Form 10-Q filing with the SEC, which it expects to
file after the filing of the Form 10-K.
The Company continues to expect that the restatement will
likely result in a net reduction of previously reported net
income and revenue in the two-year period of fiscal 1999 and
fiscal 2000 and a net increase in previously reported revenue
in the two-year period of fiscal 2001 and fiscal 2002, and
that the net amount of revenue previously recorded for fiscal
years 1999 and 2000 that will be reversed, or reversed and
restated, in later fiscal years or otherwise adjusted as a
result of a restatement will likely not exceed 10 percent of
the total revenue originally reported for those two years,
taken in aggregate. At this stage, the Company cannot estimate
the impact of the restatement on net income for fiscal 2001
or fiscal 2002. In addition, the Company now believes that
the restatement will also cover fiscal 1998, and the impact to
fiscal 1998 will be disclosed in the Form 10-K filing.
With regard to the 2002 year-end balance sheet, the
Company now believes that the total impact on the Company's
shareholder equity, or net assets, will most likely be a
reduction of $50 million to $150 million. Even with this
impact, the Company will have ended fiscal 2002 with
shareholder equity in excess of $1.0 billion.
Any actual restatement may vary from the estimates
provided, may involve other issues and, as stated previously,
likely would affect comparisons between currently reported
amounts and amounts reported for previous periods.
Teleconference information, instructions
A conference call has been scheduled for today beginning
at 4:45 pm ET and may be accessed through the Symbol website
at www.symbol.com/investors or by using the telephone dial-in
number, which is 719-457-2653. A telephonic replay will be
available today beginning at 8:45 pm ET through May 6 on a 24-
hours non-stop basis. The dial-in number to access this
replay is: 719-457-0820 - Access Code: 644798.
About Symbol Technologies
Symbol Technologies, founded in 1975, is a global leader
in secure mobile information systems that integrate
application-specific hand-held computers with wireless
networks for data and voice and bar code data capture. Symbol
products and services increase productivity and reduce costs
for the world's leading retailers, logistics and
transportation companies, government agencies, manufacturers
and providers of healthcare, hospitality and security. More
information is available at www.symbol.com and 1-800-722-6234
or 631-738-2400.
This news release contains forward-looking
statements based on current expectations, forecasts and
assumptions that involve risks and uncertainties that could
cause actual outcomes and results to differ materially. These
risks and uncertainties include price and product competition,
dependence on new product development, reliance on major
customers, customer demand for our products and services,
control of costs and expenses, international growth, general
industry and market conditions and growth rates and general
domestic and international economic conditions including
interest rate and currency exchange rate fluctuations. For a
further list and description of such risks and uncertainties,
see the reports filed by Symbol with the Securities and
Exchange Commission. Symbol disclaims any intention or
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or
otherwise.
# # # #
For financial information: For press information:
Nancy Tully Doug Picker
Symbol Technologies, Inc. Symbol Technologies, Inc.
631-738-5050 631-738-4699
SYMBOL TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (1)
(All amounts in millions, except stock par value)
March 31, 2003 December 31, 2002
ASSETS (Unaudited) (Unaudited)
CURRENT ASSETS:
Cash, including temporary investments $ 98.6 $ 76.1
Accounts receivable, less allowance
for doubtful accounts of $33.1 and
$32.0, respectively 227.8 267.7
Inventories 310.4 334.6
Deferred income taxes 171.1 172.7
Other current assets 74.5 52.5
TOTAL CURRENT ASSETS 882.4 903.6
PROPERTY, PLANT AND EQUIPMENT, net 220.0 222.2
DEFERRED INCOME TAXES 38.8 38.7
INVESTMENT IN MARKETABLE SECURITIES 54.7 54.9
INTANGIBLE AND OTHER ASSETS, net 514.3 513.2
$1,710.2 $1,732.6
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 270.4 $ 279.9
Current portion of long-term debt 50.3 6.7
Income taxes payable 1.9 0.3
Deferred revenue 38.1 29.2
Accrued restructuring expenses 8.6 5.5
TOTAL CURRENT LIABILITIES 369.3 321.6
LONG-TERM DEBT, less current maturities 54.5 135.6
OTHER LIABILITIES AND DEFERRED REVENUE 64.9 63.9
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Preferred stock, par value $1.00;
authorized 10.0 shares, none issued
or outstanding ? ?
Series A Junior Participating preferred
stock, par value $1.00, authorized
.5 shares, none issued or outstanding ? ?
Common stock, par value $0.01; authorized
600.0 shares; issued 256.9 shares and
256.6 shares, respectively 2.6 2.6
Additional paid-in capital 1,104.1 1,101.9
Accumulated other comprehensive income (11.5) (14.5)
Retained earnings 361.1 356.3
1,456.3 1,446.3
Less:
Treasury stock at cost, 25.7 shares
and 25.7 shares, Respectively (234.8) (234.8)
1,221.5 1,211.5
$1,710.2 $1,732.6
(1) Before the impact of restatement.
SYMBOL TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (1)
FOR THE THREE MONTHS ENDED MARCH 31, 2003
(All amounts in millions, except per share data)
Three Months Ended March 31,
____2003____ __2002 ____
(Unaudited) (Unaudited)
NET REVENUE $ 357.4 $ 301.3
COST OF REVENUE 213.2 191.8
AMORTIZATION OF SOFTWARE DEV.
COSTS _____5.0 _____4.2
GROSS PROFIT 139.2 105.3
OPERATING EXPENSES:
Engineering 35.3 26.7
Selling, general & administrative 90.5 63.3
Restructuring and impairment charge 5.3 ---
Compensation charge ____--____ ___8.6__
TOTAL OPERATING EXPENSES 131.1 98.6
EARNINGS FROM OPERATIONS 8.1 6.7
OTHER INCOME 1.2 --
INTEREST EXPENSE, NET _____(2.2)_ __(4.1)__
EARNINGS BEFORE INCOME TAXES 7.1 2.6
PROVISION FOR INCOME TAXES ______2.3__ ___0.8___
NET EARNINGS _$____4.8__ _$_1.8____
NET EARNINGS PER SHARE:
Basic _$____0.02_ _$_0.01___
Diluted __$____0.02_ _$_0.01___
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING:
Basic ____ 231.1__ __229.2___
Diluted _____234.4__ __234.6___
(1) Results presented are before the impact of restatement.
SYMBOL TECHNOLOGIES, INC. AND SUBSIDIARIES
NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (1) (2)
FOR THE THREE MONTHS ENDED MARCH 31, 2003
(All amounts in millions, except per share data)
Three Months Ended March 31,
____2003____ __2002 ____
(Unaudited) (Unaudited)
NET REVENUE $ 357.4 $ 301.3
COST OF REVENUE 211.3 191.8
AMORTIZATION OF SOFTWARE DEV.
COSTS _____5.0 _____4.2
GROSS PROFIT 141.1 105.3
OPERATING EXPENSES:
Engineering 35.3 26.7
Selling, general & administrative ____90.5 ____63.3
TOTAL OPERATING EXPENSES 125.8 90.0
EARNINGS FROM OPERATIONS 15.3 15.3
OTHER INCOME 1.2 --
INTEREST EXPENSE, NET _____(2.2)_ __(4.1)__
EARNINGS BEFORE INCOME TAXES 14.3 11.2
PROVISION FOR INCOME TAXES ______4.6__ ___3.6___
NET EARNINGS _$____9.7__ _$_7.6____
NET EARNINGS PER SHARE:
Basic _$____0.04_ _$_0.03___
Diluted __$____0.04_ _$_0.03___
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING:
Basic ____ 231.1__ __229.2___
Diluted _____234.4__ __234.6___
(1) Results presented are before the impact of restatement.
(2) The non-GAAP statements exclude the impact of a restructuring charge,
certain compensation charges, and the impairment write-down of our
investment in the applicable periods. See reconciliation to reported
results on the next page.
SYMBOL TECHNOLOGIES, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP TO REPORTED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (1)
FOR THE THREE MONTHS ENDED MARCH 31, 2003
(All amounts in millions, except per share data)
Three Months Ended March 31,
__2003_____ __2002____
(Unaudited) (Unaudited)
Non-GAAP net earnings $ 9.7 $ 7.6
Restructuring charge (4.1) ---
Write-down of investment (3.1) ---
Compensation charge --- (8.6)
Income tax effect ______2.3__ ____2.8_
Reported net earnings _$____4.8__ _$_1.8__
(1) Results presented are before the impact of restatement.
Please note additional Q1 2003 schedules follow:
Page
Operating Results 1
Analysis of Revenue 2
Statement of Operations 3
Balance Sheet 4
Cash Flow Trend 5
Unaudited Supplemental Detail
Symbol Technologies, Inc.
Q1 2003 Sequential Quarterly Results - Unaudited Financial Information
($ in Millions except EPS)
Note: All financial data and financial ratios will be impacted by the
financial statement restatement
Note: P&L data excludes special charges
Read schedule left to right
- ----------------------------------------------------------------------
Q1 02 Higher/ Q2 02 Higher/ Q3 02
Actual (Lower) Actual (Lower) Actual
-----------------------------------------------
Profit & Loss:
- --------------
Revenue $301.3 $14.5 $315.8 $23.7 $339.5
Gross Margin % 35.0% 2.0 pts. 37.0% 0.7 pts. 37.7%
Operating Margin % 5.1% 0.4 pts. 5.5% 2.1 pts. 7.6%
EPS $0.03 $0.01 $0.04 $0.03 $0.07
Balance Sheet
- -------------
DSO 84 (3) 81 (5) 76
Inventory Turns 2.6 - 2.6 0.1 2.7
Working Capital %
to rev. 52.9% (2.3)pts. 50.6% (4.9)pts. 45.7%
Debt/Equity 24.5% (3.5)pts. 21.0% (3.6)pts. 17.4%
Return on Assets 1.6% 0.5 pts. 2.1% 1.4 pts. 3.5%
Return on Equity 2.6% 0.6 pts. 3.2% 2.1 pts. 5.3%
Cash Flow
- ---------
CFFO $43.3 $3.5 $46.8 $4.6 $51.4
NFF (CFFO + Investing
activities) $24.9 $3.2 $28.1 $(0.9) $27.2
Capital Spending $9.4 $(0.6) $8.8 $(1.5) $7.3
Higher/ Q4 02 Higher/ Q1 03
(Lower) Actual (Lower) Actual
-------------------------------------------
Profit & Loss:
- --------------
Revenue $23.9 $363.4 $(6.0) $357.4
Gross Margin % 1.2 pts. 38.9% 0.6 pts. 39.5%
Operating Margin % 0.4 pts. 8.0% (3.7)pts. 4.3%
EPS $0.01 $0.08 $(0.04) $0.04
Balance Sheet
- -------------
DSO (9) 67 (9) 58
Inventory Turns (0.0) 2.7 0.1 2.8
Working Capital %
to rev. (5.7)pts. 40.0% (4.1)pts. 35.9%
Debt/Equity (5.7)pts. 11.7% (3.1)pts. 8.6%
Return on Assets 0.7 pts. 4.2% (1.9)pts. 2.3%
Return on Equity 0.9 pts. 6.2% (3.0)pts. 3.2%
Cash Flow
- ---------
CFFO $15.8 $67.2 $8.9 $76.1
NFF (CFFO + Investing
activities) $25.6 $52.8 $3.1 $55.9
Capital Spending $1.0 $8.3 $2.2 $10.5
- ----------------------------------------------------------------------
Unaudited Supplemental Detail
Symbol Technologies, Inc.
Analysis of Revenue
($ in Millions)
Note: All financial data and financial ratios will be impacted by the
financial statement restatement
Read schedule left to right
Higher/(Lower) Higher/(Lower)
- ----------------------------------------------------------------------
(1)Product Q1 02 $ % Q2 02 $ %
- ----------------------------------------------------------------------
Scanners $71.5 $4.6 6.5% $76.1 $(3.4) (4.5%)
Mobile 134.1 14.5 10.8% 148.7 17.8 12.0%
@POS - - - - 0.5 -
Wireless 22.9 (1.0) (4.2%) 22.0 5.0 22.8%
----------------------------------------------------
Total Products 228.6 18.2 8.0% 246.7 19.9 8.1%
Services 72.8 (3.7) (5.1%) 69.1 3.8 5.5%
----------------------------------------------------
Total Revenue $301.3 $14.5 4.8% $315.8 $23.7 7.5%
=====================================================
Higher/(Lower)
- ----------------------------------------------------------------------
(1)Product Q3 02 $ % Q4 02 $ % Q1 03
- ----------------------------------------------------------------------
Scanners $72.7 $7.4 10.1% $80.1 $(1.9) (2.3%) $78.2
Mobile 166.4 8.5 5.1% 174.9 1.4 0.8% 176.3
@POS 0.5 3.6 785.0% 4.0 1.3 33.2% 5.3
Wireless 27.0 (0.8) (3.0%) 26.2 (0.8) (3.1%) 25.4
----------------------------------------------------
Total Products 266.6 18.6 7.0% 285.2 - - 285.2
Services 72.9 5.3 7.3% 78.2 (6.0) (7.7%) 72.2
----------------------------------------------------
Total Revenue $339.5 $23.9 7.0% $363.4 $(6.0) (1.7%)$357.4
====================================================
Note: Scanners does not include the scanning component of Mobile &
Wireless Computers
Higher/(Lower) Higher/(Lower)
- ----------------------------------------------------------------------
(1) Geographic Q1 02 $ % Q2 02 $ %
- ----------------------------------------------------------------------
TASS $209.6 $6.9 3.3% $216.5 $11.0 5.1%
EMEA 76.4 4.0 5.2% 80.4 7.1 8.8%
APAC 15.3 3.6 23.5% 18.9 5.6 29.5%
---------------------------------------------------
Total Revenue $301.3 $14.5 4.8% $315.8 $23.7 7.5%
===================================================
Higher/(Lower) Higher/(Lower)
- ----------------------------------------------------------------------
(1) Geographic Q3 02 $ % Q4 02 $ % Q1 03
- ----------------------------------------------------------------------
TASS $227.5 $1.9 0.8% $229.4 $(4.9) (2.1)% $224.5
EMEA 87.5 21.2 24.2% 108.7 0.3 0.3% 109.0
APAC 24.5 0.8 3.3% 25.3 (1.4) (5.6)% 23.9
-----------------------------------------------------
Total Revenue $339.5 $23.9 7.0% $363.4 $(6.0) (1.7)% $357.4
=====================================================
(1) Unaudited Financial Information
Higher/(Lower) Higher/(Lower)
- ----------------------------------------------------------------------
(2) Industry Q1 02 $ % Q2 02 $ %
- ----------------------------------------------------------------------
Retailers $98.9 $5.2 5.3% $104.1 $22.0 21.2%
Transportation
& Logistics 38.9 6.9 17.7% 45.8 (4.2) (9.2)%
Manufacturers 37.6 1.6 4.3% 39.2 29.2 74.4%
Other 53.2 4.4 8.3% 57.6 (27.1) (47.1)%
-------------------------------------------------------
Total Product $228.6 $18.1 7.9% $246.7 $19.9 8.1%
=======================================================
Higher/(Lower) Higher/(Lower)
- ----------------------------------------------------------------------
(2) Industry Q3 02 $ % Q4 02 $ % Q1 03
- ----------------------------------------------------------------------
Retailers $126.1 $(15.3) (12.2)% $110.8 $8.8 7.9 % $119.6
Transportation
& Logistics 41.6 16.1 38.8% 57.7 (2.2) (3.9)% 55.5
Manufacturers 68.4 (3.3) (4.8)% 65.1 (2.5) (3.9)% 62.6
Other 30.5 21.1 69.2% 51.6 (4.1) (7.9)% 47.5
-------------------------------------------------------
Total Product $266.6 $18.6 7.0% $285.2 $- - $285.2
=======================================================
Note: Industry is based on the Dun & Bradstreet classification of
a customer's primary business
Higher/(Lower) Higher/(Lower)
- ----------------------------------------------------------------------
(2) Application Q1 02 $ % Q2 02 $ %
- ----------------------------------------------------------------------
Retail Store
Management $73.8 $1.3 1.8% $75.1 $15.3 20.4%
Warehouse/DC/Yard
Mgt 70.0 15.6 22.3% 85.6 7.5 8.8%
Truck/Private
Fleet/Parcel 10.2 11.6 113.7% 21.8 (3.0) (13.9)%
ID/Tracking/Security 12.0 10.8 90.0% 22.8 (0.8) (3.6)%
Other 62.6 (21.2) (33.9)% 41.4 0.9 2.2%
--------------------------------------------------
Total Product $228.6 $18.1 7.9% $246.7 $19.9 8.1%
==================================================
Higher/(Lower) Higher/(Lower)
- ----------------------------------------------------------------------
(2) Application Q3 02 $ % Q4 02 $ % Q1 03
- ----------------------------------------------------------------------
Retail Store
Management $90.4 $4.1 4.6% $94.5 $10.7 11.3% $105.2
Warehouse/DC/Yard
Mgt 93.1 28.9 31.0% 122.0 (1.3) (1.1)% 120.7
Truck/Private
Fleet/Parcel 18.8 (3.5) (18.6)% 15.3 (1.0) (6.5)% 14.3
ID/Tracking/
Security 22.0 (13.0) (59.2)% 9.0 (3.1) (34.5)% 5.9
Other 42.3 2.1 5.0% 44.4 (5.3) (11.9)% 39.1
------------------------------------------------------
Total Product $266.6 $18.6 7.0% $285.2 $- - $285.2
======================================================
Note: Application is based on the software & use of a product; one
industry group may have multiple applications.
(2) Not for Financial reporting. Analytical information subject to
periodic adjustment
Unaudited Supplemental Detail
Symbol Technologies, Inc.
Statement of Operations - As Reported, before impact of restatement
(Dollars in millions)
Note: All financial data and financial ratios will be impacted by the
financial statement restatement
2002 - As Reported
----------------------------------------------
Q1 Q2 Q3 Q4 Total
----------------------------------------------
Revenue 301.3 315.9 339.5 363.4 1,320.1
Cost of revenue 191.8 193.9 206.7 217.0 809.4
Amortization of
Software 4.2 4.9 5.0 5.0 19.1
----------------------------------------------
Gross profit 105.3 117.1 127.8 141.4 491.6
Operating expenses
Engineering 26.7 29.5 34.3 33.4 123.9
Selling , G&A 63.3 70.2 71.3 78.8 283.6
Restructuring and
Impairment 0.0 47.2 0.0 0.0 47.2
Compensation Charge 8.6 0.0 0.0 0.0 8.6
----------------------------------------------
Total operating
expenses 98.6 146.9 105.6 112.2 463.3
----------------------------------------------
Operating income /
(loss) 6.7 (29.8) 22.2 29.2 28.3
Other Income 0.0 0.0 0.0 1.2 1.2
Interest expense,
net (4.1) (3.6) (3.0) (3.3) (14.0)
----------------------------------------------
Pre-tax earnings /
(loss) 2.6 (33.4) 19.2 27.1 15.5
Provision for /
(benefit from)
income taxes 0.8 (10.6) 6.1 8.7 5.0
----------------------------------------------
Net earnings /
(loss) 1.8 (22.8) 13.1 18.4 10.5
Weighted avg
shares outstanding 234.6 229.4 233.4 233.2 233.1
Earnings / (loss)
per share $0.01 ($0.10) $0.06 $0.08 $0.05
----------------------------------------------
PERCENTAGE OF
REVENUE
--------------------
Revenue 100.0% 100.0% 100.0% 100.0% 100.0%
Cost of revenue 63.7% 61.4% 60.9% 59.7% 61.3%
Amortization of
Software 1.4% 1.6% 1.5% 1.4% 1.4%
----------------------------------------------
Gross profit 35.0% 37.1% 37.6% 38.9% 37.2%
Operating expenses
Engineering 8.9% 9.3% 10.1% 9.2% 9.4%
Selling , G&A 21.0% 22.2% 21.0% 21.7% 21.5%
Restructuring and
Impairment 0.0% 14.9% 0.0% 0.0% 3.6%
Compensation Charge 2.9% 0.0% 0.0% 0.0% 0.7%
----------------------------------------------
Total operating
expenses 32.7% 46.5% 31.1% 30.9% 35.1%
----------------------------------------------
Operating income /
(loss) 2.2% -9.4% 6.5% 8.0% 2.1%
Other Income 0.0% 0.0% 0.0% 0.3% 0.1%
Interest expense,
net -1.4% -1.1% -0.9% -0.9% -1.1%
----------------------------------------------
Pre-tax earnings /
(loss) 0.9% -10.6% 5.7% 7.5% 1.2%
Provision for /
(benefit from)
income taxes 0.3% -3.4% 1.8% 2.4% 0.4%
----------------------------------------------
Net earnings /
(loss) 0.6% -7.2% 3.9% 5.1% 0.8%
----------------------------------------------
Q1 2002 Q2 2002 Q3 2002 YTD 2002
---------------------------- ----------
Excludes Excludes Excludes Excludes
Special Special Special Special
charges charges charges charges
-----------------------------------------
Revenue 301.3 315.9 339.5 1,320.1
Cost of revenue 191.8 193.9 206.7 809.4
Amortization of Software 4.2 4.9 5.0 19.1
---------------------------- ----------
Gross profit 105.3 117.1 127.8 491.6
Operating expenses
Engineering 26.7 29.5 34.3 123.9
Selling, G&A 63.3 70.2 67.6 279.9
Restructuring and
Impairment 0.0 0.0 0.0 0.0
Compensation Charge 0.0 0.0 0.0 0.0
---------------------------- ----------
Total operating expenses 90.0 99.7 101.9 403.8
---------------------------- ----------
Operating income / (loss) 15.3 17.4 25.9 87.8
Other Income 0.0 0.0 0.0 1.2
Interest expense, net (4.1) (3.6) (3.0) (14.0)
---------------------------- ----------
Pre-tax earnings / (loss) 11.2 13.8 22.9 75.0
Provision for / (benefit
from) income taxes 3.6 4.5 7.3 24.1
---------------------------- ----------
Net earnings / (loss) 7.6 9.3 15.6 50.9
Weighted avg shares
outstanding 234.6 229.4 233.4 233.1
Earnings / (loss) per
share $0.03 $0.04 $0.07 $0.22
---------------------------- ----------
PERCENTAGE OF REVENUE
-----------------------
Revenue 100.0% 100.0% 100.0% 100.0%
Cost of revenue 63.7% 61.4% 60.9% 61.3%
Amortization of Software 1.4% 1.6% 1.5% 1.4%
---------------------------- ----------
Gross profit 35.0% 37.1% 37.6% 37.2%
Operating expenses
Engineering 8.9% 9.3% 10.1% 9.4%
Selling, G&A 21.0% 22.2% 19.9% 21.2%
Restructuring and
Impairment 0.0% 0.0% 0.0% 0.0%
Compensation Charge 0.0% 0.0% 0.0% 0.0%
---------------------------- ----------
Total operating expenses 29.9% 31.6% 30.0% 30.6%
---------------------------- ----------
Operating income / (loss) 5.1% 5.5% 7.6% 6.7%
Other Income 0.0% 0.0% 0.0% 0.1%
Interest expense, net -1.4% -1.1% -0.9% -1.1%
---------------------------- ----------
Pre-tax earnings / (loss) 3.7% 4.4% 6.7% 5.7%
Provision for / (benefit
from) income taxes 1.2% 1.4% 2.2% 1.8%
---------------------------- ----------
Net earnings / (loss) 2.5% 2.9% 4.6% 3.9%
---------------------------- ----------
2003 Q1 2003
------- --------
Excludes
Q1 Special
charges
------- --------
Revenue 357.4 357.4
Cost of revenue 213.2 211.3
Amortization of Software 5.0 5.0
------- --------
Gross profit 139.2 141.1
Operating expenses
Engineering 35.3 35.3
Selling , G&A 90.5 90.5
Restructuring and Impairment 5.3 0.0
Compensation Charge 0.0 0.0
------- --------
Total operating expenses 131.1 125.8
------- --------
Operating income / (loss) 8.1 15.3
Other Income 1.2 1.2
Interest expense, net (2.2) (2.2)
------- --------
Pre-tax earnings / (loss) 7.1 14.3
Provision for / (benefit from) income taxes 2.3 4.6
------- --------
Net earnings / (loss) 4.8 9.7
Weighted avg shares outstanding 234.4 234.4
Earnings / (loss) per share $0.02 $0.04
------- --------
PERCENTAGE OF REVENUE
--------------------------------------------
Revenue 100.0% 100.0%
Cost of revenue 59.7% 59.1%
Amortization of Software 1.4% 1.4%
------- --------
Gross profit 38.9% 39.5%
Operating expenses
Engineering 9.9% 9.9%
Selling , G&A 25.3% 25.3%
Restructuring and Impairment 1.5% 0.0%
Compensation Charge 0.0% 0.0%
------- --------
Total operating expenses 36.7% 35.2%
------- --------
Operating income / (loss) 2.3% 4.3%
Other Income 0.0% 0.0%
Interest expense, net -0.6% -0.6%
------- --------
Pre-tax earnings / (loss) 2.0% 4.0%
Provision for / (benefit from) income taxes 0.6% 1.3%
------- --------
Net earnings / (loss) 1.4% 2.7%
------- --------
Unaudited Supplemental Detail
Symbol Technologies, Inc.
Balance Sheet - As Reported, before impact of restatement
(Dollars in millions)
Note: All financial data and financial ratios will be impacted by the
financial statement restatement
-------------------------------- --------
2002 2003
-------------------------------- -------
Q1 Q2 Q3 Q4 Q1
-------------------------------- --------
Assets
Cash and temporary
investments 72.1 69.3 69.6 76.1 98.6
Accounts receivable 279.5 282.7 283.6 267.7 227.8
Inventories 306.8 302.6 316.9 334.6 310.4
Deferred income taxes 183.8 180.9 183.6 172.7 171.1
Prepaid and refundable
income taxes 17.1 31.4 26.7 0.0 0.0
Other current assets 90.4 81.2 75.1 52.5 74.5
-------------------------------- --------
Total current assets 949.7 948.1 955.5 903.6 882.4
Property, plant and equipment
- net 239.2 232.4 226.4 222.2 220.0
Deferred income taxes 18.5 18.5 18.5 38.7 38.8
Investment in marketable
securities 71.2 58.5 43.9 54.9 54.7
Intangible and other assets -
net 553.0 511.1 522.7 513.2 514.3
-------------------------------- --------
Total assets 1,831.6 1,768.6 1,767.0 1,732.6 1,710.2
================================ ========
Liabilities & Stockholders'
Equity
Accounts payable and
accrued expenses 259.5 261.9 288.5 279.9 270.4
Current portion of
long-term
debt 6.6 6.4 6.7 6.7 50.3
Income taxes payable 0.0 0.0 0.0 0.3 1.9
Deferred revenue 31.1 29.7 32.2 29.2 38.1
Accrued restructuring
expenses 15.1 11.3 7.9 5.5 8.6
-------------------------------- --------
Total current liabilities 312.3 309.3 335.3 321.6 369.3
Convertible subordinated
notes and debentures 45.1 0.0 0.0 0.0 0.0
Long-term debt, less current
maturities 237.0 237.5 197.5 135.6 54.5
Other liabilities and
deferred revenue 59.7 62.6 62.8 63.9 64.9
Stockholders' Equity
Common stock 2.6 2.6 2.6 2.6 2.6
Other stockholders'
equity 1,174.9 1,156.6 1,168.8 1,208.9 1,218.9
-------------------------------- --------
Total stockholders' equity 1,177.5 1,159.2 1,171.4 1,211.5 1,221.5
-------------------------------- --------
Total liabilities and equity 1,831.6 1,768.6 1,767.0 1,732.6 1,710.2
================================ ========
Financial ratios: -------------------------------- --------
Days sales outstanding 84 81 76 67 58
-------------------------------- --------
Inventory turnover 2.6 2.6 2.7 2.7 2.8
-------------------------------- --------
Inventory turnover
(excluding special
charges) 2.8
-------------------------------- --------
Return on assets 0.4% -5.1% 3.0% 4.2% 1.1%
-------------------------------- --------
Return on assets
(excluding special
charges) 1.6% 2.1% 3.5% 2.3%
-------------------------------- --------
Current ratio 3.0 3.1 2.8 2.8 2.4
-------------------------------- --------
Current ratio
(excluding special
charges) 3.1 3.0 2.4
-------------------------------- --------
Unaudited Supplemental Detail
Symbol Technologies, Inc.
Cash Flow Trend - As Reported, before impact of restatement
(Dollars in millions)
Note: All financial data and financial ratios will be impacted by the
financial statement restatement
------------------------------- ------
2002 2003
------------------------------- ------
Modified Cash Flow Q1 Q2 Q3 Q4 Total Q1
------------------------------- ------
Cash Flow from Operating
Activities
Net Income/(Loss) 1.8 (22.8) 13.1 18.4 10.5 4.8
Depreciation and Amort. of
PP&E 10.2 11.9 13.1 12.5 47.7 12.2
Other Amortization 7.2 8.7 8.4 8.7 33.0 8.7
Provision for Losses on A/R 1.6 1.1 1.5 2.1 6.3 1.7
Non Cash Restructuring
& Impairment 0.0 47.2 0.0 0.0 47.2 7.2
Non Cash Compensation 0.0 0.0 3.0 0.0 3.0 0.0
Deferred Income Taxes 0.0 0.0 0.0 (1.2) (1.2) 1.6
Tax Benefits from Stock
Options 6.8 0.2 0.9 0.3 8.2 0.3
Changes in Assets and
Liabilities Accounts Receivable 26.0 (1.6) (5.0) 15.6 35.0 39.6
Inventories 4.0 5.3 (15.3)(16.9) (22.9) 24.1
Other Assets 9.0 10.3 6.8 2.9 29.0 (22.0)
Accounts Payable and
Accrued Expenses (19.1) 3.2 21.9 (0.2) 5.8 (9.5)
Accrued Restructuring
Expenses (3.8) (3.8) (3.3) (0.1) (11.0) (4.1)
Other Liabilities and Deferred
Revenue (0.4)(12.9) 6.3 25.1 18.1 11.5
------------------------------- ------
Cash Flow from Operations 43.3 46.8 51.4 67.2 208.7 76.1
------------------------------- ------
Proceeds from sale of
property, plant and
equip. 0.0 4.2 0.0 0.0 4.2 0.5
Capital Expenditures (9.4) (8.8) (7.3) (8.3) (33.8) (10.5)
Investment in Intangibles &
Other (9.0)(14.1)(16.9) (6.1) (46.1) (10.2)
------------------------------- ------
Net Funds Flow 24.9 28.1 27.2 52.8 133.0 (55.9)
Cash Flow from Financing
Activities (33.4)(34.2)(27.8)(48.1)(143.5) (35.8)
Other (0.4) 3.3 0.9 1.8 5.6 2.4
------------------------------- ------
Increase/(Decrease) in
Cash (8.9) (2.8) 0.3 6.5 (4.9) 22.5
------------------------------- ------
Beginning Cash Balance 81.0 72.1 69.3 69.6 81.0 76.1
------------------------------- ------
Ending Cash Balance 72.1 69.3 69.6 76.1 76.1 98.6