Exhibit 99.1
Intermec Announces Second Quarter Fiscal Year 2007 Results
EVERETT, Wash.--(BUSINESS WIRE)--Aug. 2, 2007--Intermec, Inc.
(NYSE: IN):
-- Q2 Revenues Reflect Strong Sequential Growth to $210.5M
-- Gross Margin Improves 2.6 points from Q1'07
-- Earnings from Continuing Operations result in EPS of $0.13
-- Cash Equivalents and Short-Term Investments Increase $15.6M
from Q1'07
Intermec, Inc. (NYSE: IN) today announced financial results for
its second quarter ended July 1, 2007.
Intermec reported 2007 second quarter revenues of $210.5 million
and net earnings from continuing operations of $7.9 million, or $0.13
per diluted share, compared to 2006 second quarter revenues of $231.4
million and net earnings from continuing operations of $11.3 million,
or $0.18 per diluted share. The second quarter 2006 operating results
include a $2.3 million pre-tax gain, or $0.02 per diluted share, from
the sale of an investment. Including discontinued operations, net
earnings for the second quarter of 2007 was $6.6 million, or $0.11 per
diluted share compared to net earnings of $10.4 million, or $0.16 per
diluted share in the prior year's second quarter.
The Company's effective tax rate for the second quarter of 2007
was 37 percent; this was consistent with the prior year's quarter.
Second quarter 2007 revenues decreased 9 percent compared to the
prior year's second quarter. On a sequential basis, second quarter
2007 revenues increased 17 percent over the first quarter of 2007.
Geographically during the second quarter of 2007, North American
revenues decreased 21 percent compared to the second quarter of 2006.
Revenues in Europe, Mid-East and Africa (EMEA) increased 1 percent
compared to the same prior-year period; and the rest of the world,
consisting of Asia Pacific and Latin America, increased 26 percent.
Selling, general and administrative expenses were $68.8 million
for the second quarter of 2007, compared to $78.5 million in the prior
year period. The decrease of $9.7 million, or 12%, reflects the impact
of the prior year cost reduction initiatives as well as the benefit
from other operating gains of $2.0 million.
The Company's cash equivalents and short-term investments position
at the end of the second quarter was $188.9 million. The increase in
cash equivalents and short-term investments of $15.6 million during
the second quarter was primarily due to operating profit contribution
and the decrease in inventory.
As previously announced on July 19, 2007, Intermec Inc.'s Board of
Directors elected Patrick J. Byrne as President and CEO, and as a
Director of Intermec, Inc.
"I am excited to be joining the strong team already in place at
Intermec," said Mr. Byrne. "The company is benefiting from
the acceptance of its new product offerings, technology innovation and
the global markets continuing trend toward supply chain efficiency and
productivity. We are pleased with the recent RFID wins at Metro and
Thailand's Suvarnabhumi Airport; these are representative of the
diverse product applications utilizing this technology."
During the quarter, Intermec introduced a number of new products:
-- The rugged CK31ex mobile computer integrates the industry's
only near-far area imager. With the CK31ex, users can scan 1D,
2D, composite and postal codes, capture images for
proof-of-delivery, and wirelessly connect to corporate
networks, eliminating the need for multiple devices.
-- The powerful CK32IS mobile computer is certified to meet the
highest ratings from UL, ATEX and IECEx to deliver real-time
information. The CK32IS is designed to provide double-fault,
intrinsically safe computing in even the most hazardous
environments.
-- The EasyCoder PF2i RFID baggage tag printer is designed for
meeting the demands of airline and transportation applications
where space is limited and downtime is not an option.
Exceptional throughput and print quality are maintained even
with RFID labels.
-- The Intermec IF61 Enterprise RFID Reader contains the
combination of an Intel Celeron M 600MHz processor and up to 1
GB of optional memory. With ample storage and memory to run
complex applications, the IF61 can also store tag data and
operate peripheral devices -- all without a dedicated
industrial computer.
Third Quarter Outlook
Intermec also reported today its GAAP basis outlook for the third
quarter 2007.
-- Revenues for the period are expected within a range of $203
million to $213 million.
-- Diluted EPS from continuing operations are expected within a
range of $0.06 to $0.12.
Conference Call Information
Intermec will hold a conference call on August 2, 2007 at 5 p.m.
ET (2 p.m. PT). The call will be hosted by Intermec, Inc. President
and Chief Executive Officer, Patrick J. Byrne, Chief Financial Officer
and SVP, Lanny H. Michael, Intermec Technologies Corporation President
and COO, Steven J. Winter, and Director of Investor Relations, Kevin
P. McCarty.
The dial-in numbers for participants are 1-(800) 857-8060 (US);
1-(210) 839-8066 (International); Passcode: ("Intermec"). The call
will be broadcast on the Internet via a link from the investor's Web
page at the Intermec website at www.intermec.com/InvestorRelations
About Intermec, Inc.
Intermec, Inc. (NYSE:IN) develops, manufactures and integrates
technologies that identify, track and manage supply chain assets. Core
technologies include RFID, mobile computing and data collection
systems, bar code printers and label media. The Company's products and
services are used by customers in many industries worldwide to improve
the productivity, quality and responsiveness of business operations.
For more information about Intermec, visit www.intermec.com or call
800-347-2636. Contact Intermec Investor Relations Director Kevin
McCarty at kevin.mccarty@intermec.com, 425-265-2472.
(Forward-looking Statements)
Statements made in this release and related statements that
express Intermec's or our management's intentions, hopes, indications,
beliefs, expectations, forecasts or predictions of the future
constitute forward-looking statements, as defined by the Private
Securities Litigation Reform Act of 1995, and relate to matters that
are not historical facts. They include, without limitation, statements
regarding potential increases in sales or product volumes, potential
easing of price competition or price erosion, and our ability to
launch new products as planned, improve gross margins or profits of
our business segments, our cost reduction and restructuring plans, our
revenue, expense or financial outlook for the third quarter of 2007 or
any future period, and the applicability of accounting policies used
in our financial reporting. They also include statements about our
ability to compete effectively with our current products and newly
launched products, reduce expenses, improve efficiency, realign
resources, increase product development capacity, leverage our
research and development investment to drive significant future
revenue, and continue operational improvement and year-over-year
growth. Actual results may differ from those expressed or implied in
our forward-looking statements. These statements represent beliefs and
expectations only as of the date they were made. We may elect to
update forward-looking statements but we expressly disclaim any
obligation to do so, even if our beliefs and expectations change. Such
forward-looking statements involve and are subject to certain risks
and uncertainties. These include, but are not limited to, risks and
uncertainties described more fully in our reports filed or to be filed
with the Securities and Exchange Commission including, but not limited
to, our annual reports on Form 10-K and quarterly reports on Form
10-Q.
INTERMEC, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, amounts in thousands except per share amounts)
Three Months Ended Six Months Ended
------------------- -------------------
July 1, July 2, July 1, July 2,
2007 2006 2007 2006
--------- --------- --------- ---------
Revenues
Product $169,939 $192,440 $311,451 $358,790
Service 40,584 38,997 78,390 76,478
--------- --------- --------- ---------
Total revenues 210,523 231,437 389,841 435,268
Costs and expenses
Cost of product revenues 108,726 116,401 200,920 217,015
Cost of service revenues 20,623 21,413 43,206 44,274
Selling, general and
administrative 68,772 78,496 138,334 156,289
Gain on intellectual
property settlement - - - (16,538)
Restructuring charge - 1,135 - 2,242
--------- --------- --------- ---------
Total costs and expenses 198,121 217,445 382,460 403,282
--------- --------- --------- ---------
Operating profit from
continuing operations 12,402 13,992 7,381 31,986
Gain on sale of investments - 2,305 - 2,305
Interest income, net 119 1,766 378 2,910
--------- --------- --------- ---------
Earnings from continuing
operations before taxes 12,521 18,063 7,759 37,201
Provision for income taxes 4,591 6,767 4,261 10,835
--------- --------- --------- ---------
Earnings from continuing
operations 7,930 11,296 3,498 26,366
Loss from discontinued
operations, net of tax (1,283) (940) (1,283) (2,019)
--------- --------- --------- ---------
Net earnings $ 6,647 $ 10,356 $ 2,215 $ 24,347
========= ========= ========= =========
Basic earnings (loss) per share
Continuing operations $ 0.13 $ 0.18 $ 0.06 $ 0.42
Loss from discontinued
operations
(0.02) (0.02) (0.02) (0.03)
--------- --------- --------- ---------
Net earnings per share $ 0.11 $ 0.16 $ 0.04 $ 0.39
========= ========= ========= =========
Diluted earnings (loss) per
share
Continuing operations $ 0.13 $ 0.18 $ 0.06 $ 0.41
Loss from discontinued
operations (0.02) (0.02) (0.02) (0.03)
--------- --------- --------- ---------
Net earnings per share $ 0.11 $ 0.16 $ 0.04 $ 0.38
========= ========= ========= =========
Shares used in computing earnings (loss)
per share
Basic 60,251 63,252 60,121 63,138
Diluted 61,065 64,529 60,987 64,565
INTERMEC, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited, amounts in thousands)
July 1, December 31,
2007 2006
---------- ------------
ASSETS
Current assets:
Cash and cash equivalents $ 159,535 $ 155,027
Short-term investments 29,372 29,510
Accounts receivable, net of allowance for
doubtful accounts and sales returns of
$9,437 and $7,796 156,236 158,369
Inventories 115,593 119,027
Net current deferred tax assets 49,875 49,623
Assets held for sale 8,393 8,661
Other current assets 27,658 28,913
---------- ------------
Total current assets 546,662 549,130
Property, plant and equipment, net 43,455 43,453
Intangibles, net 6,097 3,978
Net deferred tax assets 175,836 190,683
Other assets 21,807 23,096
---------- ------------
Total assets $ 793,857 $ 810,340
========== ============
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current liabilities:
Accounts payable and accrued expenses $ 101,606 $ 113,207
Payroll and related expenses 25,616 32,008
Deferred revenue 50,392 45,021
Current portion of long-term debt 100,000 -
---------- ------------
Total current liabilities 277,614 190,236
Long-term deferred revenue 14,862 17,318
Long-term debt - 100,000
Other long-term liabilities 76,684 85,184
Shareholders' investment:
Common stock 602 598
Additional paid-in-capital 665,754 657,468
Accumulated deficit (217,632) (212,903)
Accumulated other comprehensive loss (24,027) (27,561)
---------- ------------
Total shareholders' investment 424,697 417,602
---------- ------------
Total liabilities and shareholders' investment $ 793,857 $ 810,340
========== ============
INTERMEC, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, amounts in thousands of dollars)
Three Months Ended
-------------------
July 1, July 2,
2007 2006
--------- ---------
Cash and cash equivalents at beginning of year $155,027 $256,782
--------- ---------
Cash flows from operating activities of continuing
operations:
Net earnings from continuing operations 3,498 24,347
Adjustments to reconcile net earnings to net
cash provided by (used in) operating
activities:
Depreciation and amortization 6,190 5,186
Deferred taxes 3,531 10,097
Excess tax benefits from stock-based
payment arrangements (1,181) (3,076)
Changes in working capital and other
operating activities (7,862) 25,832
--------- ---------
Net cash provided by operating activities
of continuing operations 4,176 62,386
Cash flows from investing activities of continuing
operations:
Capital expenditures (5,474) (12,304)
Purchases of investments (1,355) (19,695)
Sale of investments 1,493 565
Note receivable 1,500 -
Other investing activities (1,313) 5
--------- ---------
Net cash used in investing activities of
continuing operations (5,149) (31,429)
Cash flows from financing activities of continuing
operations:
Excess tax benefits from stock-based payment
arrangements 1,181 3,076
Stock options exercised 3,042 4,340
Other financing activities 1,008 1,616
--------- ---------
Net cash provided by financing activities
of continuing operations 5,231 9,032
Net cash provided by continuing operations 4,258 39,989
Net cash provided by operating activities of
discontinued operations 250 6,912
--------- ---------
Resulting increase in cash and cash equivalents 4,508 46,901
--------- ---------
Cash and cash equivalents at end of period $159,535 $303,683
========= =========
CONTACT: Intermec, Inc.
Kevin P. McCarty, 425-265-2472
Director of Investor Relations
kevin.mccarty@intermec.com