SOURCE: CalAmp Corp.

CalAmp Corp.

April 28, 2011 16:01 ET

CalAmp Reports Fiscal 2011 Fourth Quarter and Full Year Results

OXNARD, CA--(Marketwire - Apr 28, 2011) - CalAmp Corp. (NASDAQ: CAMP), a leading provider of wireless products, services and solutions, today reported results for its fiscal fourth quarter and full year ended February 28, 2011. Key elements include:

--  Consolidated fourth quarter revenues of $28.9 million; wireless datacom
    fourth quarter revenues up 48% year-over-year to $23.4 million.
--  Consolidated full year revenues of $114.3 million; wireless datacom
    full year revenues up 37% year-over-year to $78.4 million.
--  Consolidated fourth quarter gross margin percentage of 28.9%, up from
    20.2% in fourth quarter of prior year; consolidated full year gross
    margin percentage of 25.9%, up from 20.0% in prior year.
--  Fourth quarter GAAP net income of $0.3 million, or $0.01 per diluted
    share; Adjusted Basis (non-GAAP) net income of $0.7 million, or $0.02
    per diluted share.

Commenting on the fiscal 2011 fourth quarter and full year results, Rick Gold, CalAmp's Chief Executive Officer said, "CalAmp returned to profitability on a GAAP basis this quarter for the first time in four years. Our wireless datacom business continued its strong momentum, with quarterly revenues increasing 48% year-over-year. This growth is now being driven by both our mobile resource management (MRM) products and our wireless networks products. We are seeing strong demand for our MRM products from the local fleet management, vehicle finance, asset tracking and stolen vehicle recovery verticals. Our wireless networks products also showed strong growth with contributions from projects in the public safety, railroad and energy sectors. We are making significant investments in R&D to expand and strengthen our footprint in wireless data, and we're encouraged by the traction our new products are getting in the market."

Mr. Gold continued, "In our satellite business, fourth quarter revenue was softer than expected. During the quarter, we began the production ramps of one older product and one new product, but those ramps did not occur until late in the quarter. Volume shipments of both products are now underway and are expected to drive significantly higher satellite revenue during our fiscal 2012 first quarter. In addition, we are on track with our recently announced plans for enhancing the operational flexibility and cost structure of our satellite business. We are continuing to work on additional new products that we expect to launch this year and we expect improved financial results from this business in fiscal 2012."

Fiscal 2011 Fourth Quarter Results

Total revenue for the fiscal 2011 fourth quarter was $28.9 million compared to $34.5 million for the fourth quarter of fiscal 2010 as higher revenues in the Company's wireless datacom segment were offset by lower satellite segment revenues. Wireless datacom revenue increased 48% to $23.4 million from $15.8 million in the same period last year, while satellite revenue decreased to $5.6 million from $18.7 million in the same period last year.

Consolidated gross profit for the fiscal 2011 fourth quarter was $8.4 million, or a 28.9% gross margin, compared to gross profit of $7.0 million, or a 20.2% gross margin, for the same period last year. The increases in gross profit and gross margin percentage in the latest quarter were due primarily to higher wireless datacom revenues.

An income tax benefit of $172,000 was recorded in the fiscal 2011 fourth quarter relating to the carryback of net operating losses of the Company's French subsidiary. Excluding this item, no income tax provision or benefit was recorded in fiscal 2011, and no income tax provision or benefit is expected to be recorded in fiscal 2012 due to the existence of net operating loss carryforwards for U.S. federal and state tax purposes.

Results of operations for the fiscal 2011 fourth quarter as determined in accordance with GAAP was net income of $0.3 million, or $0.01 per diluted share, compared to a net loss of $1.3 million, or $0.05 per diluted share, in the fourth quarter of last year.

The Adjusted Basis (non-GAAP) net income for the fiscal 2011 fourth quarter was $0.7 million, or $0.02 per diluted share, compared to Adjusted Basis net loss of $0.5 million, or $0.02 loss per diluted share, for the same period last year. The Adjusted Basis net income (loss) excludes intangible asset amortization and stock-based compensation expense, and includes a pro forma income tax provision or benefit computed without giving effect to increases or decreases in the deferred income tax valuation allowance that are recognized for GAAP basis financial reporting. A reconciliation of the GAAP basis pretax income (loss) to the Adjusted Basis net income (loss) is provided in the table at the end of this press release.

Liquidity

As of February 28, 2011, the Company had total cash of $4.2 million and total debt of $11.9 million. Total debt at that date consisted of $7.49 million drawn under the Company's revolving bank credit facility and subordinated debt of $4.46 million. The unused borrowing capacity on the bank revolver was $3.8 million at February 28, 2011. Net cash provided by operating activities during the three- and twelve-month periods ended February 28, 2011 was $51,000 and $857,000, respectively.

Business Outlook

Commenting on the Company's business outlook, Mr. Gold said, "Based on our latest projections, we expect fiscal 2012 first quarter consolidated revenues in the range of $31 to $34 million. First quarter satellite revenues are expected to increase significantly on a sequential quarter basis. Wireless datacom revenues are expected to increase significantly on a year-over-year basis, but be down slightly on a sequential basis. We expect fiscal first quarter GAAP basis net income (loss) in the range of a $0.01 loss to $0.02 income per diluted share. The Adjusted Basis (non-GAAP) net income for the first quarter is expected to be in the range of breakeven to $0.03 income per diluted share."

Mr. Gold continued, "Based on our current forecast, we expect fiscal 2012 revenue to trend higher compared to fiscal 2011 with growth in both our satellite and wireless datacom businesses, and we expect to be profitable on a GAAP basis for the year as a whole."

Conference Call and Webcast

A conference call and simultaneous webcast to discuss fiscal 2011 fourth quarter and full year financial results and business outlook will be held today at 4:30 p.m. Eastern / 1:30 p.m. Pacific. CalAmp's CEO Rick Gold, President/COO Michael Burdiek and CFO Rick Vitelle will host the conference call. Participants can dial into the live conference call by calling 800-762-8779 (480-629-9771 for international callers). An audio replay will be available through May 5, 2011, by calling 800-406-7325 (303-590-3030 for international callers) and entering the access code 4430187.

Additionally, a live webcast of the call will be 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. 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

CalAmp develops and markets wireless communications solutions that deliver data, voice and video for critical networked communications and other applications. The Company's two business segments are Wireless Datacom, which serves utility, governmental and enterprise customers, and Satellite, which focuses on the North American Direct Broadcast Satellite market. For more information, please visit www.calamp.com.

Forward-Looking Statements

Statements in this press release that are not historical in nature are forward-looking statements that involve known and unknown risks and uncertainties. Words such as "may," "will," "expect," "intend," "plan," "believe," "seek," "could," "estimate," "judgment," "targeting," "should," "anticipate," "goal" 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 product demand, competitive pressures and pricing declines in the Company's satellite and wireless datacom markets, the timing of customer approvals of new product designs, the length and extent of the global economic downturn that has and may continue to adversely affect the Company's business, and other risks or uncertainties that are described in the Company's Report on Form 10-K for fiscal 2011 as filed today with the Securities and Exchange Commission. Although the Company believes the expectations reflected in such f orward-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.

                              CAL AMP CORP.
                  CONSOLIDATED STATEMENTS OF OPERATIONS
                  (In thousands except per share amounts)


                                  Three Months Ended        Year Ended
                                     February 28,          February 28,
                                --------------------  --------------------
                                   2011       2010       2011       2010
                                ---------  ---------  ---------  ---------
                                /----(Unaudited)---/

Revenues                        $  28,944  $  34,481  $ 114,333  $ 112,113

Cost of revenues                   20,576     27,499     84,775     89,723
                                ---------  ---------  ---------  ---------

Gross profit                        8,368      6,982     29,558     22,390
                                ---------  ---------  ---------  ---------

Operating expenses:
  Research and development          2,850      2,686     11,125     10,943
  Selling                           2,633      2,422     10,503      9,542
  General and administrative        2,168      2,512      8,858     10,523
  Intangible asset amortization       275        342      1,132      1,367
                                ---------  ---------  ---------  ---------
                                    7,926      7,962     31,618     32,375
                                ---------  ---------  ---------  ---------

Operating income (loss)               442       (980)    (2,060)    (9,985)

Non-operating expense, net           (311)      (352)    (1,395)    (2,240)
                                ---------  ---------  ---------  ---------

Income (loss) before income
 taxes                                131     (1,332)    (3,455)   (12,225)

Income tax benefit                    172          -        172      1,374
                                ---------  ---------  ---------  ---------

Net income (loss)               $     303  $  (1,332) $  (3,283) $ (10,851)
                                =========  =========  =========  =========

Earnings (loss) per share -
 basic                          $    0.01  $   (0.05) $   (0.12) $   (0.43)
Earnings (loss) per share -
 diluted                        $    0.01  $   (0.05) $   (0.12) $   (0.43)

Shares used in basic per
 share calculations                27,325     26,442     27,181     25,309
Shares used in diluted per
 share calculations                28,072     26,442     27,181     25,309



                       BUSINESS SEGMENT INFORMATION
                              (In thousands)

                                  Three Months Ended        Year Ended
                                     February 28,          February 28,
                                --------------------  --------------------
                                   2011       2010       2011       2010
                                ---------  ---------  ---------  ---------
                                /----(Unaudited)---/

Revenues
  Satellite                     $   5,583  $  18,700  $  35,899  $  54,715
  Wireless DataCom                 23,361     15,781     78,434     57,398
                                ---------  ---------  ---------  ---------

    Total revenues              $  28,944  $  34,481  $ 114,333  $ 112,113
                                =========  =========  =========  =========

Gross profit (loss)
  Satellite                     $    (493) $   1,853  $   1,636  $   4,258
  Wireless DataCom                  8,861      5,129     27,922     18,132
                                ---------  ---------  ---------  ---------

    Total gross profit          $   8,368  $   6,982  $  29,558  $  22,390
                                =========  =========  =========  =========

Operating income (loss)
  Satellite                     $  (1,459) $     740  $  (2,460) $    (111)
  Wireless DataCom                  2,876     (1,076)     4,922     (5,867)
  Corporate expenses                 (975)      (644)    (4,522)    (4,007)
                                ---------  ---------  ---------  ---------

    Total operating income
     (loss)                     $     442  $    (980) $  (2,060) $  (9,985)
                                =========  =========  =========  =========



                              CAL AMP CORP.
                        CONSOLIDATED BALANCE SHEETS
                              (In thousands)                               

                                                  February 28, February 28,
                                                      2011         2010
                                                   ----------   ----------
                       Assets
Current assets:
  Cash and cash equivalents                        $    4,241   $    2,986
  Accounts receivable, net                             16,814       16,520
  Inventories                                           9,890       10,608
  Deferred income tax assets                            1,961        2,656
  Prepaid expenses and other current assets             5,197        4,720
                                                   ----------   ----------
       Total current assets                            38,103       37,490
Equipment and improvements, net                         1,877        2,055
Deferred income tax assets, less current portion        9,887       10,017
Intangible assets, net                                  4,012        5,144
Other assets                                            1,606        2,247
                                                   ----------   ----------

                                                   $   55,485   $   56,953
                                                   ==========   ==========
          Liabilities and Stockholders' Equity
Current liabilities:
  Bank working capital line of credit              $    7,489   $    5,901
  Accounts payable                                     14,103       16,186
  Accrued payroll and employee benefits                 3,341        2,742
  Deferred revenue                                      5,796        4,740
  Other current liabilities                             2,140        3,526
                                                   ----------   ----------

      Total current liabilities                        32,869       33,095
                                                   ----------   ----------

Long-term debt                                          4,460        4,170
Other non-current liabilities                             554          489

Stockholders' equity:
  Common stock                                            281          277
  Additional paid-in capital                          153,135      151,453
  Accumulated deficit                                (134,948)    (131,665)
  Accumulated other comprehensive loss                   (866)        (866)
                                                   ----------   ----------

      Total stockholders' equity                       17,602       19,199
                                                   ----------   ----------

                                                   $   55,485   $   56,953
                                                   ==========   ==========


                              CAL AMP CORP.
                    CONSOLIDATED CASH FLOW STATEMENTS
                              (In thousands)

                                                          Year Ended
                                                         February 28,
                                                    ----------------------
                                                       2011        2010
                                                    ----------  ----------
Cash flows from operating activities:
  Net loss                                          $   (3,283) $  (10,851)
  Depreciation and amortization                          2,543       2,522
  Stock-based compensation expense                       2,109       1,981
  Amortization of debt issue costs and discount            536           -
  Loss on sale of investment                                 -       1,008
  Deferred tax assets, net                                 807          39
  Changes in operating working capital                  (1,835)      7,792
  Other                                                    (20)        104
                                                    ----------  ----------

     Net cash provided by operating activities             857       2,595
                                                    ----------  ----------

Cash flows from investing activities:
  Capital expenditures                                  (1,245)     (1,066)
  Proceeds from sale of investment                           -         992
  Collections on note receivable                           428         325
  Other                                                     32         (36)
                                                    ----------  ----------

     Net cash (used in) provided by investing
      activities                                          (785)        215
                                                    ----------  ----------

Cash flows from financing activities:
  Net proceeds from line of credit borrowing             1,588       7,551
  Proceeds from issuance of subordinated debt                -       5,000
  Net proceeds from sale of common stock                     -       3,968
  Debt repayments                                            -     (22,728)
  Payment of debt issue costs                                -        (544)
  Taxes paid related to net share settlement of
   vested equity awards                                   (405)       (123)
                                                    ----------  ----------

     Net cash provided by (used in) financing
      activities                                         1,183      (6,876)
                                                    ----------  ----------

Effect of exchange rate changes on cash                      -         139
                                                    ----------  ----------

Net change in cash and cash equivalents                  1,255      (3,927)

Cash and cash equivalents at beginning of period         2,986       6,913
                                                    ----------  ----------

Cash and cash equivalents at end of period          $    4,241  $    2,986
                                                    ==========  ==========



                              CAL AMP CORP.
                     NON-GAAP EARNINGS RECONCILIATION
            (Unaudited, in thousands except per share amounts)

Non-GAAP Earnings Reconciliation

"GAAP" refers to financial information presented in accordance with Generally Accepted Accounting Principles in the United States. This press release includes historical non-GAAP financial measures, as defined in Regulation G promulgated by the Securities and Exchange Commission. CalAmp believes that its presentation of historical non-GAAP financial measures provides useful supplementary information to investors. The presentation of historical non-GAAP financial measures is not meant to be considered in isolation from or as a substitute for results prepared in accordance with GAAP.

In this press release, CalAmp reports the non-GAAP financial measures of Adjusted Basis Net Income (Loss) and Adjusted Basis Net Income (Loss) Per Diluted Share. CalAmp uses these non-GAAP financial measures to enhance the investor's overall understanding of the financial performance and future prospects of CalAmp's core business activities. Specifically, CalAmp believes that a report of Adjusted Basis Net Income (Loss) and Adjusted Basis Net Income (Loss) Per Diluted Share provides consistency in its financial reporting and facilitates the comparison of results of core business operations between its current and past periods.

The reconciliation of the GAAP Basis Pretax Income (Loss) to Adjusted Basis (non-GAAP) Net Income (Loss) is as follows:

                                  Three Months Ended        Year Ended
                                     February 28,          February 28,
                                --------------------  --------------------
                                   2011       2010       2011       2010
                                ---------  ---------  ---------  ---------

GAAP basis pretax income (loss) $     131  $  (1,332) $  (3,455) $ (12,225)

Amortization of intangible assets     275        342      1,132      1,367
Stock-based compensation expense      550        565      2,109      1,981
                                ---------  ---------  ---------  ---------
Pretax income (loss) (non-GAAP
 basis)                               956       (425)      (214)    (8,877)

Income tax benefit (provision)
 (non-GAAP basis) (a)                (288)       (29)        29      3,919
                                ---------  ---------  ---------  ---------

Non-GAAP net income (loss)      $     668  $    (454) $    (185) $  (4,958)
                                =========  =========  =========  =========

Non-GAAP net income (loss) per
 diluted share                  $    0.02  $   (0.02) $   (0.01) $   (0.20)

Non-GAAP weighted average common
 shares outstanding on diluted
 basis                             28,072     26,442     27,181     25,309


(a) The non-GAAP income tax benefit (provision) is computed using the
    Company's combined U.S. federal and state statutory tax rate of 40.0%
    and 40.7% in fiscal 2011 and 2010, respectively, excluding the pretax
    losses of foreign operations for which no income tax benefit is
    recognized and excluding the effects of increases and decreases in the
    deferred income tax valuation allowance.

Contact Information

  • AT THE COMPANY:
    Rick Vitelle
    Chief Financial Officer
    (805) 987-9000

    AT FINANCIAL RELATIONS BOARD:
    Lasse Glassen
    General Information
    (213) 486-6546
    lglassen@mww.com