Exhibit 99.1
NEWS BULLETIN
FROM:
CalAmp Logo CalAmp Corp.
1401 N. Rice Avenue
Oxnard, CA 93030
Nasdaq: CAMP
For Further Information:
AT THE COMPANY: AT FINANCIAL RELATIONS BOARD:
Rick Vitelle Lasse Glassen
Chief Financial Officer General Information
(805)987-9000 (310)854-8313
lglassen@financialrelationsboard.com
Amy Cozamanis
Investor/Analyst Information
(310)854-8314
acozamanis@financialrelationsboard.com
FOR IMMEDIATE RELEASE
CAL AMP REPORTS FISCAL 2006 FIRST QUARTER RESULTS
Company Achieves 51% Increase in Net Income
Driven by Improvements in Gross Margin
OXNARD, Calif., July 7, 2005--CalAmp Corp. (Nasdaq: CAMP), a leading provider
of wireless products and engineering services, today reported results for its
fiscal 2006 first quarter ended May 31, 2005.
Fiscal 2006 First Quarter Results
Revenue for the first quarter of fiscal 2006 was $47.6 million, compared to
$45.0 million for the first quarter of fiscal 2005. The increase reflects
the inclusion of recently acquired Skybility for six weeks of the fiscal 2006
first quarter, which contributed revenue of $1.2 million during this period.
Net income for the fiscal 2006 first quarter was $2.0 million or $0.09 per
diluted share compared to net income of $1.3 million or $0.07 per diluted
share for the first quarter of last year. This represents a 51% increase in
net income. First quarter results include pretax charges of $293,000 and
$471,000 in fiscal 2006 and 2005, respectively, for the write-off of in-
process research and development associated with acquisitions.
Gross profit for the first quarter of fiscal 2006 was $10.7 million, or 22.5%
of revenues compared to $8.3 million or 18.4% of revenues for the same period
last year. The increases in gross profit and gross margin were primarily the
result of changes in product mix for Products Division sales and actions
taken to improve the financial performance of the Solutions Division.
"We are quite pleased with the bottom line improvement generated during the
first quarter of fiscal 2006," commented Fred Sturm, CalAmp's President and
Chief Executive Officer. "Earnings per share of $0.09 was at the high end of
our guidance range for the quarter and was driven by improved gross margins
in both the Products and Solutions Divisions. During the quarter, the
Products Division benefited from a mix of products favoring higher-margin
Direct Broadcast Satellite (DBS) equipment and positive contributions from
Skybility, which was acquired mid-quarter. The integration of Skybility has
now been completed and we look forward to leveraging CalAmp's high volume
manufacturing capability and design and development expertise with
Skybility's strong customer relationships and intellectual property. The
Solutions Division is also showing improved results as we continue to execute
on our strategy of selectively pursuing higher-margin business opportunities
and refining the cost structure required to deliver our services."
Mr. Sturm continued, "As anticipated, during the first quarter, our primary
DBS customers adjusted their inventory holding levels, resulting in a
sequential decline in Product Division quarterly revenues. However, the
order rate has increased in the beginning of our fiscal 2006 second quarter
due to continued demand for feature rich equipment that supports our
customers' multi-satellite and digital video recorder service offerings.
Longer term, we expect to benefit from higher value added products and the
higher gross profit associated with these advanced products."
Liquidity
At May 31, 2005, the Company had total cash of $29.2 million, with $9.8
million in total outstanding debt. During the past 12 months total cash
increased by $5.5 million due primarily to $13 million of cash provided from
operating activities, partially offset by cash used for the Skybility
acquisition of $4.9 million and debt reductions of $3 million.
Business Outlook
Commenting on the Company's fiscal 2006 second quarter outlook, Mr. Sturm
said, "Based on our current projections, we estimate that fiscal 2006 second
quarter revenues will be in the range of $52 to $60 million, and that
earnings will be in the range of $0.10 to $0.14 per diluted share. For the
full year of fiscal 2006, we continue to target 10% to 15% revenue growth
reflecting introduction of new products, growth in our DBS business, and the
contributions of our recent strategic acquisitions made to diversify our
markets and customer base."
Conference Call and Webcast
A conference call and simultaneous webcast to discuss fiscal 2006 first
quarter financial results and business outlook will be held today at 4:30
p.m. Eastern / 1:30 p.m. Pacific. The live webcast of the call is available
on CalAmp's web site at www.calamp.com. Participants are encouraged to visit
the web site at least 15 minutes prior to the start of the call to register,
download and install any necessary audio software.
CalAmp's President and CEO Fred Sturm and CFO Rick Vitelle will host the
conference call. After the live webcast, a replay will remain available until
the next quarterly conference call in the Investor Relations section of
CalAmp's web site.
About CalAmp Corp.
CalAmp is a leading provider of wireless equipment, engineering services and
software that enable anytime/anywhere access to critical information, data
and entertainment content. With comprehensive capabilities ranging from
product design and development through volume production, CalAmp delivers
cost-effective high quality solutions to a broad array of customers and end
markets. CalAmp is the leading supplier of Direct Broadcast Satellite (DBS)
outdoor customer premise equipment to the U.S. satellite television market.
The Company also provides wireless connectivity solutions for the telemetry
and asset tracking markets, healthcare industry, enterprise-class Wi-Fi
networks and digital multimedia delivery applications. For additional
information, please visit the Company's website at www.calamp.com.
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," "expect," "intend," "plan,"
"believe," "seek," "could," "estimate," "judgment," "targeting," 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 eliminate operating losses
in its Solutions Division and make this business segment profitable, 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.
[TABLES FOLLOW]
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CAL AMP CORP.
CONSOLIDATED INCOME STATEMENTS
(unaudited, in thousands except per share amounts)
Three Months Ended
May 31,
-------------------
2005 2004
------- -------
Revenues $47,580 $44,997
Cost of revenues 36,882 36,696
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Gross profit 10,698 8,301
------- -------
Operating expenses:
Research and development 2,197 1,807
Selling 1,872 1,072
General and administrative 2,614 2,445
Intangible asset amortization 443 260
In-process research and development 293 471
------- -------
7,419 6,055
------- -------
Operating income 3,279 2,246
Non-operating income (expense), net 43 (64)
------- -------
Income before income taxes 3,322 2,182
Income tax provision (1,345) (873)
------- -------
Net income $ 1,977 $ 1,309
======= =======
Net income per share:
Basic $ 0.09 $ 0.07
Diluted $ 0.09 $ 0.07
Shares used in per share
calculations:
Basic 22,492 18,755
Diluted 22,910 19,750
BUSINESS SEGMENT INFORMATION:
Three Months Ended
May 31,
-------------------
2005 2004
------- -------
Revenue:
Products Division $41,168 $40,499
Solutions Division 6,412 4,498
------- -------
Total revenue $47,580 $44,997
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Gross profit:
Products Division $ 8,810 $ 7,266
Solutions Division 1,888 1,035
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Total gross profit $10,698 $ 8,301
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Operating income (loss):
Products Division $ 5,356 $ 4,634
Solutions Division (1,143) (1,509)
Corporate expenses (934) (879)
------- -------
Total operating income $ 3,279 $ 2,246
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CAL AMP CORP.
CONSOLIDATED BALANCE SHEETS
(Unaudited - In thousands)
May 31, February 28,
2005 2005
-------- --------
Assets
Current assets:
Cash and cash equivalents $ 29,186 $ 31,048
Accounts receivable, net 24,101 27,027
Inventories 26,533 21,465
Deferred income tax assets 5,716 6,118
Prepaid expenses and other current assets 3,780 2,876
-------- --------
Total current assets 89,316 88,534
Equipment and improvements, net 5,513 5,383
Deferred income tax assets 4,869 5,285
Goodwill 94,977 92,834
Other intangible assets, net 4,554 4,028
Other assets 682 691
-------- --------
$199,911 $196,755
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Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt $ 2,880 $ 2,897
Accounts payable 21,835 18,389
Accrued payroll and employee benefits 2,099 3,652
Other accrued liabilities 3,285 3,127
Deferred revenue 1,474 1,597
-------- --------
Total current liabilities 31,573 29,662
-------- --------
Long-term debt, less current portion 6,965 7,679
-------- --------
Other non-current liabilities 1,093 1,126
-------- --------
Stockholders' equity:
Common stock 227 227
Additional paid-in capital 131,799 131,784
Common stock held in escrow (2,548) (2,548)
Retained earnings 31,603 29,626
Accumulated other comprehensive loss (801) (801)
-------- --------
Total stockholders' equity 160,280 158,288
-------- --------
$199,911 $196,755
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CAL AMP CORP.
CONSOLIDATED CASH FLOW STATEMENTS
(Unaudited - In thousands)
Three Months Ended
May 31,
------------------
2005 2004
---- ----
Cash flows from operating activities:
Net income $ 1,977 $ 1,309
Depreciation and amortization 1,080 959
Write-off of in-process R&D 293 471
Increase in equity associated with tax
benefit of stock option exercises 2 41
Deferred tax assets, net 818 809
Changes in operating working capital (62) 85
Other 7 (2)
-------- -------
Net cash provided by operating activities 4,115 3,672
-------- -------
Cash flows from investing activities:
Capital expenditures (373) (686)
Proceeds from sale of property and equipment - 177
Acquisition of Skybility assets (4,886) -
Acquisition of Vytek Corp., net of cash acquired - (1,727)
-------- -------
Net cash used in investing activities (5,259) (2,236)
-------- -------
Cash flows from financing activities:
Debt repayments, net of borrowings (731) (768)
Proceeds from stock option exercises 13 87
-------- -------
Net cash used in financing activities (718) (681)
-------- -------
Net change in cash (1,862) 755
Cash at beginning of period 31,048 22,885
-------- -------
Cash at end of period $ 29,186 $23,640
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