Exhibit 99.1
CalAmp Reports FY 2005 Second Quarter Results
* Q2 revenues up 110% from prior year to $51 million
* Q2 net income improves $1.4 million from prior year
Oxnard, CA, October 12, 2004 --- CalAmp Corp. (NASDAQ: CAMP) today reported
results for its second quarter ended August 31, 2004.
Revenue for the second quarter of fiscal 2005 was $50.8 million, compared to
$24.2 million for the second quarter of the prior year. The period-over-
period increase in revenue is due primarily to the improvement in satellite
product sales which began late in the Company's fiscal 2004 second quarter. Net
income for the fiscal 2005 second quarter was $1,746,000 or $0.08 per diluted
share, compared to net income of $390,000 or $0.03 per diluted share for the
second quarter of last year.
For the six months ended August 31, 2004 revenue was $95.8 million, compared
to $42.8 million in the prior year. Net income during the first six months
of fiscal 2005 was $3,055,000 or $0.14 per diluted share, versus a net loss
of $712,000 or ($0.05) per diluted share in the first six months of fiscal
year 2004.
Fred Sturm, President and Chief Executive Officer, commented, "We are pleased
with the performance of our Products Division which generated $43 million in
revenue in the second quarter on the strength of our Direct Broadcast
Satellite business that began improving over a year ago. We also received
approval on two new DBS products late in the second quarter that are expected
to begin shipping in volume during the latter part of the third quarter.
Although the DBS market remains extremely competitive, we have been able to
maintain our market position through a combination of ongoing product
development and aggressive cost effectiveness programs. Our key customers in
this business - the satellite television service providers - continue to gain
market share at the expense of the cable television operators. We look forward
to supporting the market's requirements for high performance, cost-effective
outdoor electronics in a challenging and dynamic competitive environment."
Continued Mr. Sturm, "In the second quarter our Solutions Division generated
revenues of nearly $8 million, but it remains in a loss position. Despite
this loss, we made progress during the quarter in executing on our strategic
business model of providing a complete end-to-end solution, most notably with
our recently announced manufacturing agreement with EFJohnson. However, it is
clear that we need to make certain adjustments to improve this division's
financial performance. To that end, we recently strengthened our sales and
marketing organization and have made adjustments in our overhead structure.
We will closely monitor our performance with the objective of achieving
profitable results for the Solutions Division as soon as possible without
adversely impacting our ability to execute on our strategic model."
Mr. Sturm concluded, "Based on our current visibility, we estimate fiscal 2005
third quarter revenues in the range of $50 to $58 million and earnings in the
range of $0.07 to $0.12 cents per diluted share. Included in these estimates
are charges of $461,000 for amortization of intangible assets."
About CalAmp Corp.
CalAmp is a leading provider of breakthrough wireless and content delivery
solutions, services and products. With comprehensive capabilities ranging
from product inception through production, CalAmp is a trusted partner
delivering cost-effective high quality solutions to a broad array of customers
and markets. CalAmp is one of the largest suppliers of direct broadcast
satellite (DBS) outdoor customer premise equipment to the U.S. satellite
television market and offers solutions for digital multimedia delivery,
residential broadband data delivery, healthcare, retailing applications,
public safety markets and wireless enterprise connectivity. The company is
headquartered in Oxnard, California and has approximately 600 employees.
Founded in 1981, CalAmp has been publicly traded since 1983 as NASDAQ: CAMP.
Forward Looking Statement
Statements in this press release that are not historical in nature are
forward-looking statements, which involve known and unknown risks and
uncertainties. Words such as "may," "will," "expects," "intends," "plans,"
"believes," "seeks," "could," "estimate" 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, general and
industry economic conditions, competition, development factors, operating
costs, the Company's ability to integrate the Vytek acquisition successfully
and other risks and uncertainties that are detailed from time to time in the
Company's filings 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.
For more information, contact:
Crocker Coulson Rick Vitelle
Partner Chief Financial Officer
CCG Investor Relations CalAmp
(818) 789-0100 (805) 987-9000
crocker.coulson@ccgir.com
[TABLES FOLLOW]
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CALAMP CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands except per share amounts)
Three Months Ended Six Months Ended
August 31, August 31,
------------------ ----------------
2004 2003 2004 2003
----- ------ ----- -----
Revenues $50,827 $24,197 $95,824 42,763
Cost of revenues 40,503 20,997 77,199 38,257
------- -------- ------- -------
Gross profit 10,324 3,200 18,625 4,506
Operating expenses:
Research and development 2,068 1,236 3,875 2,598
Selling 1,732 549 2,804 1,043
General and administrative 3,179 843 5,624 1,661
Intangible asset amortization 461 26 721 52
In-process research and development - - 471 -
------ ------ ------- ------
7,440 2,654 13,495 5,354
------ ------ ------- ------
Operating income (loss) 2,884 546 5,130 (848)
Non-operating expense, net (75) (129) (139) (182)
------ ------ ------- ------
Income (loss) before income taxes 2,809 417 4,991 (1,030)
Income tax (provision) benefit (1,063) (27) (1,936) 318
------ ------ ------- ------
Net income (loss) $1,746 $ 390 $3,055 $ (712)
======= ======= ======= =======
Net income (loss) per share:
Basic $0.08 $0.03 $0.15 $(0.05)
Diluted $0.08 $0.03 $0.14 $(0.05)
Shares used in per share calculations:
Basic 22,292 14,747 20,524 14,746
Diluted 22,809 14,916 21,224 14,746
Business Segment Information (1)
Three Months Ended Six Months Ended
August 31, August 31,
------------------ ----------------
2004 2003 2004 2003
----- ------ ----- -----
Revenue:
Products Division $43,056 $24,197 $83,555 $42,763
Solutions Division 7,771 - 12,269 -
------- ------- ------- -------
Total revenue $50,827 $24,197 $95,824 $42,763
======= ======= ======= =======
Gross profit
Products Division $8,503 $ 3,200 $15,769 $ 4,506
Solutions Division 1,821 - 2,856 -
------- ------- ------- -------
Total gross profit $10,324 $ 3,200 $18,625 $ 4,506
======= ======= ======= =======
Operating income (loss)
Products Division $6,036 $ 1,040 $10,670 $ 74
Solutions Division (2,083) - (3,592) -
Corporate expenses (1,069) (494) (1,948) (922)
------- ------- ------- -------
Total operating income (loss) $ 2,884 $ 546 $5,130 $ (848)
======= ======= ======= =======
(1) Effective with the acquisition of Vytek Corporation on April 12, 2004,
CalAmp realigned its operations into a divisional structure in which CalAmp's
existing Satellite and Wireless Access businesses were combined, together with
Vytek's products manufacturing business, into a new Products Division. Vytek's
principal operations, consisting of revenues generated by professional
engineering services and the development of software applications, comprise the
new Solutions Division.
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CALAMP CORP.
CONSOLIDATED BALANCE SHEETS
(Unaudited - In thousands)
August 31, February 28,
2004 2004
---- ----
Current assets:
Cash and cash equivalents $ 25,268 $ 22,885
Accounts receivable, net 25,621 18,579
Inventories 25,208 20,253
Deferred income tax assets 1,814 2,404
Prepaid expenses and other current assets 3,915 3,244
-------- --------
Total current assets 81,826 67,365
Equipment and improvements, net 5,125 4,381
Deferred income tax assets, less current portion 3,292 4,359
Goodwill 100,942 20,938
Other intangible assets, net 4,800 200
Other assets 2,346 399
-------- --------
$198,331 $ 97,642
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Current liabilities:
Bank line of credit payable $ 3,000 $ -
Current portion of long-term debt 2,946 3,603
Accounts payable 23,428 17,395
Accrued payroll and employee benefits 3,820 1,513
Other current liabilities 4,787 2,078
Deferred revenue 1,647 -
-------- --------
Total current liabilities 39,628 24,589
Long-term debt, less current portion 6,116 7,690
Stockholders' equity:
Common stock 232 149
Additional paid-in capital 138,145 44,486
Common stock held in escrow (9,594) -
Retained earnings 24,605 21,550
Accumulated other comprehensive loss (801) (822)
-------- --------
Total stockholders' equity 152,587 65,363
-------- --------
$198,331 $ 97,642
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CALAMP CORP.
CONSOLIDATED CASH FLOW STATEMENTS
(Unaudited - In thousands)
Six Months Ended
August 31,
----------
2004 2003
---- ----
Cash flows from operating activities:
Net income (loss) $ 3,055 $ (712)
Depreciation and amortization 2,075 1,613
Write-off of in-process R&D 471 -
Equipment impairment writedowns 201 575
Deferred tax assets, net 1,657 (289)
Changes in operating working capital (1,875) 2,045
Other 143 (117)
-------- -------
Net cash provided by operating activities 5,727 3,115
-------- -------
Cash flows from investing activities:
Capital expenditures (1,243) (978)
Proceeds from sale of property and equipment 627 285
Acquisition of Vytek, net of cash acquired (1,727) -
-------- -------
Net cash used in investing activities (2,343) (693)
-------- -------
Cash flows from financing activities:
Debt repayments, net of borrowings (1,557) (1,301)
Proceeds from stock option exercises 556 12
-------- -------
Net cash used in financing activities (1,001) (1,289)
-------- -------
Net change in cash 2,383 1,133
Cash at beginning of period 22,885 21,947
-------- -------
Cash at end of period $ 25,268 $23,080
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