For Immediate Release
Lantronix, Inc. Reports Fiscal 2004 Results
Irvine, CA, September 9, 2004 - Irvine, CA - Lantronix, Inc. (NASDAQ: LTRX)
today reported results from its continuing operations for its fiscal year and
fourth quarter ended June 30, 2004:
- - Revenues for the fiscal year ended June 30, 2004 were $48.9 million, flat
with the same period last year when the company recorded $49.4 million in
revenues.
- - Net loss was reduced to $(15.7) million, or $(0.28) per share for fiscal
2004, compared with net loss of $(47.5) million, or $(0.88) per share for the
previous fiscal year. Results for fiscal 2004 included a $5.0 million charge
related to the company's remaining investment in Xanboo, an early stage
technology company.
- - Operating loss was reduced to $(5.6) million for fiscal 2004, compared
with operating loss of $(36.5) million for fiscal 2003.
- - Revenue from the company's core product lines was up 14% for the quarter
ended June 2004 compared to the same period last year.
- - Revenue from the Device Networking products was up 31% for the quarter
ended June 30, 2004 compared to the same period last year.
For the fiscal year ended June 30, 2004, the company reported revenues of $48.9
million and net loss from continuing operations of $(5.6) million, or $(0.19)
per share, compared with revenues of $49.4 million and net loss from continuing
operations of $(37.4) million, or $(0.69) per share for the same period last
year.
Net loss from discontinued operations of the company's Premise subsidiary, which
was sold during the third fiscal quarter, was $(5.0) million, or $(0.09) per
share, and $(10.1) million, or $(0.19) per share for the fiscal years ended June
30, 2004, and 2003, respectively.
For the fourth fiscal quarter ended June 30, 2004, Lantronix recorded revenues
of $11.9 million and net loss from continuing operations of $(6.9) million, or
$(0.12) per share, compared with revenues of $11.8 million and a net loss from
continuing operations of $(13.0) million, or $(0.24) per share, for the same
period last year. Results for the quarter ended June 30, 2004, included a $5.0
million charge for the write-off of a long-term asset, related to the company's
investment in Xanboo, an early stage technology company, compared to impairment
and restructuring charges of $3.0 million for the same period last year.
Net income from discontinued operations was $138,000, or $0.00 per share for the
quarter ended June 30, 2004, compared with a net loss of $(6.1) million, or
$(0.11) per share for the quarter ended June 30, 2003.
Net loss was $(6.8) million, or $(0.12) per share, and $(19.1) million, or
$(0.35) per share for the quarters ended June 30, 2004, and 2003, respectively.
Cash, cash equivalents and marketable securities decreased approximately
$685,000 during the quarter ended June 30, 2004, compared with a decrease of
$459,000 for the same period a year earlier, and in line with the company's
earlier guidance of cash usage in the range of $1 million. The company indicated
that it would have cash usage in the range of $2.2 to $2.8 million for the
current quarter ending September 30, 2004, as a result of the payment of notes
incurred in connection with the Stallion acquisition two years earlier, tax
audit payments, and higher expenses for the quarter related to the launch of new
products. Cash usage is anticipated to return to the range of $1 million per
quarter in the second fiscal quarter ending December 31, 2004, and the company
affirmed its current cash flow breakeven to be in the revenue range of $14 to
$15 million per quarter.
"We experienced flat overall revenue for the recently completed year, however,
this result masks a significant shift in sales towards our core product lines of
Device Networking and IT Management, and away from legacy non-core offerings,"
stated Marc Nussbaum, president and CEO. "Growth in our core products
accelerated in the latter half of the fiscal year. We are seeing signs that
momentum is beginning to build in the Device Networking market as evidenced by
our revenue growth and a 50% increase in unit sales compared to last year.
FISCAL 2005 QUARTER OUTLOOK
The following statements are forward-looking and are based on current
expectations. Statements about future revenues, product successes or sales, or
cash usage are subject to variations in any specific period. Actual results may
differ materially from those described below. The company undertakes no
obligation to update this release.
"We expect revenues to be relatively flat in fiscal Q1 with top line growth
expected in the December quarter. Our full year fiscal 2005 outlook includes
overall top line revenue growth and we reiterate our expectation of reaching
positive cash flow from operations at $14 to 15 million in quarterly sales,"
Nussbaum said.
About Lantronix
Lantronix, Inc. (NASDAQ: LTRX) provides technology solutions that deliver Net
Intelligence , helping businesses remotely manage network infrastructure
equipment and rapidly network-enable their physical electronic devices.
Lantronix connectivity solutions securely link a company's electronic assets
through the network, allow access to business-critical data within each device
and convert that data into actionable information. With this new intelligence,
companies can achieve greater efficiencies, reduce resource consumption and
proactively transform the way they do business. The leader in device networking
and secure remote management solutions, Lantronix was founded in 1989 and has
its worldwide headquarters in Irvine, California. For more information, visit
www.lantronix.com.
This news release contains forward-looking statements that involve risks and
uncertainties. Actual results and outcomes may differ materially from those
discussed or anticipated. For example, statements regarding our future revenues,
cash usage and our cash flow breakeven point are forward looking statement.
Factors that might affect actual outcomes include, but are not limited to market
acceptance of Lantronix products by our customers, future revenues, future
expenses, future margins, cash usage, and financial performance. For a more
detailed discussion of these and associated risks, see the Company's most recent
documents filed with the Securities and Exchange Commission.
# # #
Lantronix is a registered trademark of Lantronix, Inc. All other trademarks are
properties of their respective owners.
Media Contacts: Jim Kerrigan, CFO
Lantronix
949-453-3990
SELECTED UNAUDITED CONSOLIDATED BALANCE SHEET DATA
(IN THOUSANDS)
JUNE 30,
2004 2003
---------- ----------
Cash and cash equivalents and marketable securities $ 12,178 $ 14,078
Accounts receivable, net. . . . . . . . . . . . . . 3,242 3,818
Inventories . . . . . . . . . . . . . . . . . . . . 6,677 6,011
Goodwill. . . . . . . . . . . . . . . . . . . . . . 9,488 9,488
Purchased intangible assets, net. . . . . . . . . . 2,056 4,275
Long-term investments . . . . . . . . . . . . . . . - 5,458
Total assets. . . . . . . . . . . . . . . . . . . . 45,159 62,856
Accumulated deficit . . . . . . . . . . . . . . . . (156,078) (140,424)
Total stockholders' equity. . . . . . . . . . . . . 24,791 37,717
SELECTED UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended For the Year Ended
JUNE 30, JUNE 30,
------------------- --------------------
2004 2003 2004 2003
-------- --------- -------- ----------
Net revenues. . . . . . . . . . . . . . . . . . . . . . . $11,876 $ 11,765 $ 48,885 $ 49,389
Cost of revenues. . . . . . . . . . . . . . . . . . . . . 6,734 11,430 25,026 36,264
-------- --------- --------- ---------
Gross profit. . . . . . . . . . . . . . . . . . . . . . . 5,142 335 23,859 13,125
-------- --------- --------- ---------
Operating expenses:
Selling, general and administrative . . . . . . . . . . 5,266 6,301 23,293 28,660
Research and development. . . . . . . . . . . . . . . . 2,226 2,062 7,813 9,430
Stock-based compensation. . . . . . . . . . . . . . . . 40 183 347 1,453
Amortization of purchased intangible assets . . . . . . 30 45 148 602
Impairment of goodwill and purchased intangible assets. - 2,353 - 2,353
Restructure charges . . . . . . . . . . . . . . . . . . 5 663 (2,093) 5,600
Litigation settlement costs . . . . . . . . . . . . . . - 1,533 - 1,533
-------- --------- --------- ---------
Total operating expenses. . . . . . . . . . . . . . . 7,567 13,140 29,508 49,631
-------- --------- --------- ---------
Loss from operations. . . . . . . . . . . . . . . . . . . (2,425) (12,805) (5,649) (36,506)
Interest income (expense), net. . . . . . . . . . . . . . 7 (39) 50 248
Other income (expense), net . . . . . . . . . . . . . . . (5,050) 8 (5,333) (926)
-------- --------- --------- ---------
Loss before income taxes. . . . . . . . . . . . . . . . . (7,468) (12,836) (10,932) (37,184)
Provision (benefit) for income taxes. . . . . . . . . . . (533) 188 (325) 250
-------- --------- --------- ---------
Loss from continuing operations . . . . . . . . . . . . . (6,935) (13,024) (10,607) (37,434)
Income (loss) from discontinued operations. . . . . . . . 138 (6,081) (5,047) (10,115)
-------- --------- --------- ---------
Net loss. . . . . . . . . . . . . . . . . . . . . . . . . $(6,797) $(19,105) $(15,654) $(47,549)
======== ========= ========= =========
Basic and diluted loss per share:
Loss from continuing operations . . . . . . . . . . . . $ (0.12) $ (0.24) $ (0.19) $ (0.69)
Income (loss) from discontinued operations. . . . . . . - (0.11) (0.09) (0.19)
-------- --------- --------- ---------
Net loss. . . . . . . . . . . . . . . . . . . . . . . . . $ (0.12) $ (0.35) $ (0.28) $ (0.88)
======== ========= ========= =========
Weighted average shares (basic and diluted) . . . . . . . 57,656 55,088 56,862 54,329
======== ========= ========= =========