EXHIBIT 99.1
FOR IMMEDIATE RELEASE
For further information contact:
John Schoen Jack Seller
COO/CFO Public Relations
PCTEL, Inc. PCTEL, Inc.
(773) 243-3000 (773) 243-3016
JACK.SELLER@PCTEL.COM
PCTEL POSTS $22.8 MILLION IN FOURTH QUARTER REVENUE
FINISHES 2005 WITH $77.7 MILLION IN REVENUE
UP 61 PERCENT OVER PRIOR YEAR
CHICAGO, FEBRUARY 23, 2006 -- PCTEL, Inc. (NASDAQ: PCTI), a leader in broadband
wireless solutions, announced record revenue for the fourth quarter ending
December 31, 2005 and for the entire year. Financial highlights of the quarter
and year were:
o $22.8 MILLION in revenue for the quarter, which is an increase of 49
percent over the fourth quarter 2004. Revenue for the year ended
December 31, 2005 is $77.7 million, up 61 percent from the same period
in the prior year.
o $15.3 MILLION in revenue for the quarter from the Antenna Products
Group. This is an increase of 56 percent over the fourth quarter last
year. Revenue for the year is $54.2 million, up 105% from 2004. The
comparisons are favorably impacted by the acquisition of GPS and
mobile antenna product lines from Andrew in Q4 2004 and the
acquisition of the iVET(TM) product line during the third quarter of
2005. Without those acquisitions, APG revenue increased 28% over the
prior year.
o $2.4 MILLION in revenue for the quarter from the Mobility Solutions
Group. This is an increase of 119 percent over the fourth quarter last
year. Revenue for the year is up 35 percent over 2004.
o $4.2 MILLION in revenue for the quarter from the RF Solutions Group.
This is record performance for this group and reflects the strong
contribution of UMTS scanner sales and growth of the CLARIFY(R)
product line. This is a 29 percent increase over the fourth quarter of
last year. Revenue for the year is up $3.6 million over 2004 or 33
percent.
o $0.9 MILLION in licensing revenue for the quarter. This includes the
benefit of PCTEL's settlement with US Robotics.
o A GAAP NET LOSS OF $(0.2) MILLION FOR THE QUARTER, OR $(0.01) PER
SHARE, compared to $1.1 million net income, or $0.05 per share for the
same period in 2004. Fourth quarter results last year included $3.2
million, or $0.16 per share, of non-cash income from a one time
reversal of a reserve related to the modem product lines that we
divested in 2003. Net loss, under GAAP, for the year ended December
31, 2005 was $(3.7) million, or $(0.18) per share, compared to a net
loss of $(2.7) million, or $(0.14) per share for 2004.
o NON-GAAP NET INCOME OF $2.2 MILLION FOR THE QUARTER, OR $0.11 PER
SHARE, compared to $2.3 million net income, or $0.11 per share for the
same period in 2004. Non-GAAP net income for the year ended December
31, 2005 was $4.5 million, or $0.22 per share, compared to net income
of $1.7 million, or $0.08 per share for 2004. The company's reporting
of non-GAAP income excludes non-cash based expenses for the
amortization of restricted stock awards and amortization of intangible
assets related to the company's acquisitions. Those expenses were $2.4
million in the fourth quarter 2005 compared to $1.2 million for the
same period a year ago, and $8.2 million for the year ended December
31, 2005 compared to $4.4 million in 2004.
o $59.2 MILLION OF CASH at December 31, 2005, up $0.6 million from
September 30, 2005.
"PCTEL's management team is encouraged by the company's fourth quarter results,"
said Marty Singer, PCTEL's Chairman and CEO. "Our organic investments and
acquisitions have exposed us to the exciting growth associated with wireless
broadband. This includes UMTS, Wi-Fi, WiMax, and the emergence of converged
devices. We are well positioned to participate in these markets. Our 2006 focus
points are top-line revenue growth, operational effectiveness, improvements in
gross margin, and continued development and delivery of broadband wireless
products," added Singer.
The company will discuss these results and the market trends driving the
increased revenue during its scheduled earnings teleconference today at 6:15 PM
EST.
CONFERENCE CALL / WEBCAST
The company will hold a conference call at 6:15 PM EST (5:15 PM CST) today,
Thursday, February 23, 2006 with Marty Singer, chairman and chief executive
officer, and John Schoen, chief financial officer. PCTEL will not be responding
to inquiries regarding its financial results until the conference call. The
session can be accessed by calling (800) 289-0508 (U.S. / Canada) or (913)
981-5550 (international).
To listen via the Internet, please visit, www.pctel.com, or
http://investor.pctel.com/MediaList.cfm
REPLAY: A replay will be available for two weeks after the call on PCTEL's web
site at www.pctel.com or by calling (888) 203-1112 (U.S. / Canada) or
(719) 457-0820 (international) access code: 7570147.
ABOUT PCTEL
PCTEL, Inc. (Nasdaq: PCTI), which is headquartered in Chicago, is a global
leader in wireless broadband solutions. PCTEL's Antenna Products Group
(http://antenna.pctel.com) designs, distributes, and supports innovative antenna
solutions for public safety applications, unlicensed and licensed wireless
broadband, fleet management, network timing, and other GPS applications. PCTEL's
Mobility Solutions' (http://mobilitysolutions.pctel.com) software tools provide
secure, access independent, remote connectivity to the Internet and VoIP
capability for converged handsets. PCTEL's RF Solutions'
(http://rfsolutions.pctel.com) portfolio of OEM receivers, receiver based
products and interference management solutions are used to measure, monitor and
optimize cellular networks.
PCTEL protects its leadership position with a portfolio of more than 130 analog
and broadband communications, wireless and antenna patents, issued or pending.
The company's products are sold or licensed to wireless carriers, wireless ISPs,
distributors, system integrators, wireless test and measurement companies,
wireless network equipment and handset manufacturers, PC card manufacturers and
government agencies. For more information, please visit the company's web site
at: http://www.pctel.com.
PCTEL SAFE HARBOR STATEMENT
This press release contains "forward-looking statements" as defined in the
Private Securities Litigation Reform Act of 1995. Specifically, the statements
regarding PCTEL's expectations regarding the future growth of its broadband
wireless products and the emergence of converged devices and operational
effectiveness 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 ability to successfully grow the wireless
products business, the ability to implement new technologies and obtain
protection for the related intellectual property, and the ability to integrate
acquired businesses and products. 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.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED, IN THOUSANDS, EXCEPT PER SHARE INFORMATION)
Three Months Ended Twelve Months Ended
December 31, December 31,
---------------------- ----------------------
2005 2004 2005 2004
-------- -------- -------- --------
REVENUES $ 22,794 $ 15,298 $ 77,746 $ 48,221
COST OF REVENUES 12,107 7,335 40,878 19,786
MODEM ROYALTY EXPENSE RECOVERY -- (3,208) -- (3,208)
-------- -------- -------- --------
GROSS PROFIT 10,687 11,171 36,868 31,643
-------- -------- -------- --------
OPERATING EXPENSES:
Research and development 2,548 2,405 10,015 8,614
Sales and marketing 3,388 2,948 13,074 11,247
General and administrative 4,700 4,514 16,836 15,416
Amortization of other intangible assets 1,170 840 4,137 2,972
Restructuring charges -- 129 (70) (66)
Gain on sale of assets and related royalties (500) (500) (2,100) (2,000)
-------- -------- -------- --------
Total operating expenses 11,306 10,336 41,892 36,183
-------- -------- -------- --------
INCOME (LOSS) FROM OPERATIONS (619) 835 (5,024) (4,540)
OTHER INCOME, NET 502 402 1,546 1,261
-------- -------- -------- --------
INCOME (LOSS) BEFORE PROVISION (BENEFIT) FOR INCOME TAXES (117) 1,237 (3,478) (3,279)
PROVISION (BENEFIT) FOR INCOME TAXES 39 173 235 (541)
-------- -------- -------- --------
NET INCOME (LOSS) $ (156) $ 1,064 $ (3,713) $ (2,738)
======== ======== ======== ========
Basic earnings (loss) per share $ (0.01) $ 0.05 $ (0.18) $ (0.14)
Shares used in computing basic earnings (loss) per share 20,257 20,024 20,146 20,074
Diluted earnings (loss) per share $ (0.01) $ 0.05 $ (0.18) $ (0.14)
Shares used in computing diluted earnings (loss) per share 20,257 20,179 20,146 20,074
PCTEL, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(UNAUDITED, IN THOUSANDS)
December 31, December 31,
2005 2004
--------- ---------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 58,966 $ 83,887
Restricted cash 208 208
Accounts receivable, net 13,725 10,819
Inventories, net 9,547 8,554
Prepaid expenses and other assets 3,179 2,969
--------- ---------
Total current assets 85,625 106,437
PROPERTY AND EQUIPMENT, net 11,190 9,746
GOODWILL 31,020 14,114
OTHER INTANGIBLE ASSETS, net 16,457 11,628
OTHER ASSETS 1,217 180
--------- ---------
TOTAL ASSETS $ 145,509 $ 142,105
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 2,251 $ 1,085
Income taxes payable 5,297 5,692
Deferred revenue 1,944 1,738
Accrued liabilities 6,448 9,301
--------- ---------
Total current liabilities 15,940 17,816
LONG-TERM LIABILITIES 5,542 1,366
--------- ---------
Total liabilities 21,482 19,182
--------- ---------
STOCKHOLDERS' EQUITY:
Common stock 22 21
Additional paid-in capital 167,829 160,180
Deferred compensation (7,004) (4,422)
Accumulated deficit (36,652) (32,938)
Accumulated other comprehensive income (168) 82
--------- ---------
Total stockholders' equity 124,027 122,923
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 145,509 $ 142,105
========= =========
PCTEL, INC.
REVENUE AND GROSS PROFIT BY SEGMENT
(UNAUDITED, IN THOUSANDS)
Three Months Ended Twelve Months Ended
December 31, December 31,
---------------------- ----------------------
2005 2004 2005 2004
-------- -------- -------- --------
REVENUES:
- ---------
APG $ 15,282 $ 9,826 $ 54,249 $ 26,451
RFS 4,232 3,283 14,343 10,768
MSG 2,432 1,109 6,922 5,129
LICENSING 868 1,100 2,289 5,936
MODEMS -- -- -- --
Eliminations (20) (20) (57) (63)
-------- -------- -------- --------
TOTAL REVENUES $ 22,794 $ 15,298 $ 77,746 $ 48,221
GROSS PROFIT:
- -------------
APG $ 4,319 $ 3,692 $ 17,604 $ 10,637
RFS 3,119 2,138 10,295 7,177
MSG 2,392 1,045 6,762 4,937
LICENSING 864 1,092 2,207 5,693
MODEMS -- 3,208 -- 3,208
Eliminations (7) (4) -- (9)
-------- -------- -------- --------
TOTAL GROSS PROFIT $ 10,687 $ 11,171 $ 36,868 $ 31,643
PCTEL, INC.
RECONCILIATION OF NON GAAP TO GAAP RESULTS OF OPERATIONS (A)
(UNAUDITED, IN THOUSANDS)
Three Months Ended December 31, 2005 Three Months Ended December 31, 2004
-------------------------------------- --------------------------------------
As Non-GAAP Non As Non-GAAP Non
Reported Adjustments (a) GAAP Reported Adjustments (a) GAAP
-------- ----------- ---- -------- ----------- ----
REVENUES $22,794 $22,794 $15,298 $15,298
COST OF REVENUES 12,107 (81) (b) 12,026 7,335 7,335
MODEM ROYALTY EXPENSE RECOVERY - - (3,208) (3,208)
---------- ----------- ---------- ---------- -----------
GROSS PROFIT 10,687 81 10,768 11,171 11,171
OPERATING EXPENSES:
Research and development 2,548 (97) (b) 2,451 2,405 (29) (b) 2,376
Sales and marketing 3,388 (240) (b) 3,148 2,948 (85) (b) 2,863
General and administrative 4,700 (768) (b) 3,932 4,514 (271) (b) 4,243
Amortization of other intangible assets 1,170 (1,170) -- 840 (840) --
Restructuring charges -- -- 129 129
Gain on sale of assets and related royalties (500) (500) (500) (500)
---------- ----------- ---------- ---------- ----------- -----------
Total operating expenses 11,306 (2,275) 9,031 10,336 (1,225) 9,111
---------- ----------- ---------- ---------- ----------- -----------
INCOME (LOSS) FROM OPERATIONS (619) 2,356 1,737 835 1,225 2,060
OTHER INCOME, NET 502 502 402 402
---------- ----------- ---------- ---------- ----------- -----------
INCOME (LOSS) BEFORE INCOME TAXES (117) 2,356 2,239 1,237 1,225 2,462
PROVISION FOR INCOME TAXES 39 39 173 173
---------- ----------- ---------- ---------- ----------- -----------
NET INCOME (LOSS) $ (156) $ 2,356 $ 2,200 $ 1,064 $ 1,225 $ 2,289
========== =========== ========== ========== =========== ===========
Earnings (loss) per share
Basic $ (0.01) $ 0.11 $ 0.05 $ 0.11
Diluted $ (0.01) $ 0.11 $ 0.05 $ 0.11
Shares used in computing EPS (in thousands)
Basic 20,257 20,257 20,024 20,024
Diluted 20,257 20,854 20,179 20,179
(a) These adjustments reconcile the Company's GAAP results of operations to its
non-GAAP results of operations. The Company believes that presentation of
results excluding items such as non-cash share-based compensation and
amortization of intangible assets 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. Neither the Company's GAAP nor non-GAAP results of operations
include the accounting impact had the Company chosen to apply the fair-value
recognition provisions of SFAS No. 123 or SFAS No. 123 revised (123R) to expense
share-based compensation related to stock options, the impact of which is
disclosed in the Company's Forms 10-Q and 10-K as filed with the SEC. The
Company will adopt SFAS No. 123R in its first fiscal quarter ending March 31,
2006.
(b) This adjustment reflects the non cash stock based compensation expense for
restricted stock grants and stock bonuses awarded to the Company's employees.
PCTEL, INC.
RECONCILIATION OF NON GAAP TO GAAP RESULTS OF OPERATIONS (A)
(UNAUDITED, IN THOUSANDS)
Year Ended December 31, 2005 Year Ended December 31, 2004
------------------------------------- --------------------------------------
As Non-GAAP Non As Non-GAAP Non
Reported Adjustments (a) GAAP Reported Adjustments (a) GAAP
-------- ----------- ---- -------- ----------- ----
REVENUES $ 77,746 $ 77,746 $ 48,221 $ 48,221
COST OF REVENUES 40,878 (164) (b) 40,714 19,786 19,786
MODEM ROYALTY EXPENSE RECOVERY (3,208) (3,208)
-------- -------- -------- -------- --------
GROSS PROFIT 36,868 164 37,032 31,643 31,643
OPERATING EXPENSES:
Research and development 10,015 (309) (b) 9,706 8,614 (108) (b) 8,506
Sales and marketing 13,074 (812) (b) 12,262 11,247 (303) (b) 10,944
General and administrative 16,836 (2,766) (b) 14,070 15,416 (1,014) (b) 14,402
Amortization of other intangible assets 4,137 (4,137) -- 2,972 (2,972) --
Restructuring charges (70) (70) (66) (66)
Gain on sale of assets and related royalties (2,100) (2,100) (2,000) (2,000)
-------- -------- -------- -------- -------- --------
Total operating expenses 41,892 (8,024) 33,868 36,183 (4,397) 31,786
-------- -------- -------- -------- -------- --------
INCOME (LOSS) FROM OPERATIONS (5,024) 8,188 3,164 (4,540) 4,397 (143)
OTHER INCOME, NET 1,546 1,546 1,261 1,261
-------- -------- -------- -------- -------- --------
INCOME (LOSS) BEFORE INCOME TAXES (3,478) 8,188 4,710 (3,279) 4,397 1,118
PROVISION (BENEFIT) FOR INCOME TAXES 235 235 (541) (541)
-------- -------- -------- -------- -------- --------
NET INCOME (LOSS) $ (3,713) $ 8,188 $ 4,475 $ (2,738) $ 4,397 $ 1,659
======== ======== ======== ======== ======== ========
Earnings (loss) per share
Basic $ (0.18) $ 0.22 $ (0.14) $ 0.08
Diluted $ (0.18) $ 0.22 $ (0.14) $ 0.08
Shares used in computing EPS (in thousands)
Basic 20,146 20,146 20,074 20,074
Diluted 20,146 20,701 20,074 20,793
(a) These adjustments reconcile the Company's GAAP results of operations to its
non-GAAP results of operations. The Company believes that presentation of
results excluding items such as non-cash share-based compensation and
amortization of intangible assets 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. Neither the Company's GAAP nor non-GAAP results of operations
include the accounting impact had the Company chosen to apply the fair-value
recognition provisions of SFAS No. 123 or SFAS No. 123 revised (123R) to expense
share-based compensation related to stock options, the impact of which is
disclosed in the Company's Forms 10-Q and 10-K as filed with the SEC. The
Company will adopt SFAS No. 123R in its first fiscal quarter ending March 31,
2006.
(b) This adjustment reflects the non cash stock based compensation expense for
restricted stock grants and stock bonuses awarded to the Company's employees.