SOURCE: CalAmp Corp.

CalAmp Corp.

April 25, 2013 16:01 ET

CalAmp Reports Fiscal 2013 Fourth Quarter and Full Year Results

OXNARD, CA--(Marketwired - Apr 25, 2013) - CalAmp Corp. (NASDAQ: CAMP), a leading provider of wireless products, services and solutions, today reported results for its fourth quarter and full year ended February 28, 2013. Highlights for the quarter and fiscal year include:

  • Consolidated fourth quarter revenue of $48.4 million, up 29% year-over-year, with Wireless Datacom revenue up 45%; GAAP-basis net income of $32.6 million, or $1.06 per diluted share including a non-recurring fourth quarter income tax benefit of $29.2 million; Adjusted Basis (non-GAAP) net income of $4.8 million, or $0.16 per diluted share.
  • Consolidated fiscal year revenue of $180.6 million, up 30% year-over-year with Wireless Datacom revenue up 41%; GAAP-basis net income of $44.6 million or $1.49 per diluted share including the $29.2 million tax benefit; Adjusted Basis (non-GAAP) net income of $20.4 million, or $0.68 per diluted share.
  • Net cash from operations for fiscal 2013 of $16.6 million.
  • Wireless Matrix acquired in March 2013 for a cash payment of approximately $47 million net of cash acquired.

Commenting on the full year results, Michael Burdiek, CalAmp's President and Chief Executive Officer said, "Fiscal 2013 was a transformative year for CalAmp highlighted by consolidated revenue growth of 30%, significantly improved profitability and a key acquisition consummated just after year-end that accelerates our strategic roadmap. At the top line, our performance was driven by a 41% year-over-year revenue increase in our Wireless Datacom segment, due to continued strong demand for our Mobile Resource Management (MRM) products and growing contributions from our energy, rail and public safety verticals. The strong revenue growth and improving gross margins resulted in accelerating profitability in fiscal 2013, with non-GAAP earnings per share doubling compared to last year."

Mr. Burdiek added, "We continue to see a healthy order pipeline to support our growth objectives that should deepen our presence in existing markets and provide opportunities to expand into promising new vertical applications. And in a strategic step to expand our addressable market and move further up the MRM value chain, in early March we acquired and are rapidly integrating the operations of Wireless Matrix. This acquisition helps position CalAmp as a leading provider of integrated hardware and software solutions within our core verticals, expands our recurring revenue stream and enhances our future growth prospects."

Commenting on the fourth quarter performance, Mr. Burdiek stated, "Our strong fourth quarter financial results were due to a 45% year-over-year revenue increase in our Wireless Datacom segment. This record-setting revenue was the result of continued strong customer demand for our MRM products and services, significant contributions from our customers in energy markets and improving demand for our public safety solutions. We also saw strong growth in international sales during the quarter across most of our core verticals. In the Satellite segment, we continue to be pleased with the performance and contribution of this business to our bottom-line results."

Fiscal 2013 Fourth Quarter Results
Total revenue for the fiscal 2013 fourth quarter was $48.4 million compared to $37.6 million for the fourth quarter of fiscal 2012, an increase of 29%. Wireless Datacom revenue increased to $37.3 million from $25.7 million in the same period last year, and Satellite revenue was $11.1 million compared to $12.0 million in the fourth quarter last year.

Consolidated gross profit for the fiscal 2013 fourth quarter was $15.1 million, an increase of $4.5 million over the same quarter last year that was primarily driven by higher revenue. The consolidated gross margin percentage was 31.1% in the fiscal 2013 fourth quarter, up from 28.2% in the fourth quarter last year. The increase in the consolidated gross margin percentage reflects the higher proportion of total revenues represented by the Wireless Datacom segment in fiscal 2013 versus the prior year.

GAAP-basis net income for the fiscal 2013 fourth quarter was $32.6 million, or $1.06 per diluted share. During the fourth quarter of fiscal 2013, the Company recognized an income tax benefit of $29.2 million as a result of eliminating the deferred tax asset valuation allowance associated with net operating loss and tax credit carryforwards that are expected to be utilized in future years. Excluding this income tax benefit, net income in the fourth quarter would have been $3.4 million or $0.11 per diluted share, compared to net income of $1.6 million, or $0.06 per diluted share, in the fourth quarter of last year.

Non-GAAP net income for the fiscal 2013 fourth quarter was $4.8 million, or $0.16 per diluted share, compared to non-GAAP net income of $2.6 million or $0.09 per diluted share for the same quarter last year. Non-GAAP earnings excludes the impact of intangibles amortization, stock-based compensation and acquisition-related expenses, and includes an income tax provision that reflects the income taxes paid or payable based on the non-GAAP pretax income for the period. A reconciliation of the GAAP-basis pretax income to the non-GAAP net income and earnings per diluted share is provided in the table at the end of this press release.

Liquidity
At the end of fiscal 2013, the Company had cash and cash equivalents of $63.1 million, which included net proceeds of $44.8 million from a public stock offering in the fourth quarter, and total bank debt of $1.8 million. Shortly after the end of the fiscal 2013, CalAmp completed the previously announced acquisition of Wireless Matrix for a cash payment of approximately $47 million net of cash acquired, and also entered into a new bank term loan for $5 million. Giving pro forma effect to these two transactions as if they had both occurred at the end of fiscal 2013, the year-end balances of cash and bank debt would have been $19.6 million and $5 million, respectively. The pro forma net cash balance (cash less bank debt) of $14.6 million at the end of fiscal 2013 represents an increase of $12.0 million over the net cash balance at the end of fiscal 2012.

Cash provided by operating activities was $5.8 million in the fourth quarter and $16.6 million for fiscal 2013 as a whole. After giving pro forma effect to the aforementioned new $5 million bank term loan, the unused borrowing capacity on the Company's bank revolver at the end of fiscal 2013 was $10 million.

Business Outlook
Commenting on the Company's business outlook, Mr. Burdiek said, "We enter fiscal 2014 with continued strong customer demand across most of our key market verticals. In addition, the Wireless Matrix acquisition is expected to accelerate our growth prospects, improve our competitive position and increase our subscription and SaaS-based revenues. We expect the second half of fiscal 2014 to be much stronger than the first half, as some of the recently announced opportunities begin ramping and operating expenses revert to a more normalized level as a result of synergies and expense reductions associated with the Wireless Matrix integration."

Mr. Burdiek continued, "We expect first quarter consolidated revenue in the range of $50 to $54 million. We anticipate Wireless Datacom revenue in the first quarter will be significantly higher on both a year-over-year and a sequential quarter basis. The revenue contribution from Wireless Matrix business is expected to more than fully offset a projected lull in shipments of Positive Train Control radios in the first quarter. Satellite revenue in the first quarter is expected to be up on a sequential quarter basis and relatively flat on a year-over-year basis."

Mr. Burdiek concluded, "At the bottom line, we expect first quarter GAAP-basis net income in the range of $0.01 to $0.05 per diluted share and non-GAAP net income in the range of $0.11 to $0.15 per diluted share. We also expect that our first quarter GAAP-basis operating results will be impacted by transaction and integration expenses of approximately $0.6 million arising from the Wireless Matrix acquisition."

Conference Call and Webcast
A conference call and simultaneous webcast to discuss 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 President and CEO Michael Burdiek and CFO Rick Vitelle will host the conference call. Participants can dial into the live conference call by calling 1-877-407-0784 (1-201-689-8560 for international callers) and using the Conference ID # 411337. An audio replay will be available through May 2, 2013 by calling 1-877-870-5176 or 1-858-384-5517 and entering the Conference ID # 411337.

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 Corp. (NASDAQ: CAMP) is a proven leader in providing wireless communications solutions to a broad array of vertical market applications and customers. CalAmp's extensive portfolio of intelligent communications devices, robust and scalable cloud service platform, and targeted software applications streamline otherwise complex machine-to-machine (M2M) deployments. These solutions enable customers to optimize their operations by collecting, monitoring and efficiently analyzing business critical data and desired intelligence from high-value fixed and mobile remote assets. 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 wireless and satellite markets, the timing of customer approvals of new product designs, intellectual property infringement claims, the effects of the automatic federal budget cuts required pursuant to the sequester that took effect on March 1, 2013, interruption or failure of our Internet-based systems used to wirelessly configure and communicate with the tracking and monitoring devices that we sell, integration issues that may arise in connection with the Wireless Matrix acquisition that was consummated on March 4, 2013, and other risks or uncertainties that are described in the Company's Annual Report on Form 10-K that was filed today 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.

                         
CAL AMP CORP.  
CONSOLIDATED STATEMENTS OF OPERATIONS  
(In thousands except per share amounts)  
                         
    Three Months Ended     Year Ended  
    February 28,     February 28,  
    2013     2012     2013     2012  
    /---(Unaudited)---/              
Revenues   $ 48,391     $ 37,621     $ 180,579     $ 138,728  
                                 
Cost of revenues     33,341       27,028       123,686       96,709  
                                 
Gross profit     15,050       10,593       56,893       42,019  
                                 
Operating expenses:                                
  Research and development     3,898       2,923       14,291       11,328  
  Selling     3,762       2,885       12,725       11,060  
  General and administrative     3,305       2,849       12,154       10,984  
  Intangible asset amortization     476       305       1,743       1,277  
      11,441       8,962       40,913       34,649  
                                 
Operating income     3,609       1,631       15,980       7,370  
                                 
Non-operating income (expense):                                
  Interest expense, net     (171 )     (45 )     (487 )     (1,261 )
  Foreign currency translation account write-off     -       -       -       (801 )
  Other income (expense), net     (31 )     74       (45 )     (29 )
Non-operating income (expense), net     (202 )     29       (532 )     (2,091 )
                                 
Income before income taxes     3,407       1,660       15,448       5,279  
                                 
Income tax benefit (provision)     29,223       (18 )     29,178       (61 )
                                 
Net income   $ 32,630     $ 1,642     $ 44,626     $ 5,218  
                                 
Earnings per share:                                
  Basic   $ 1.09     $ 0.06     $ 1.54     $ 0.19  
  Diluted   $ 1.06     $ 0.06     $ 1.49     $ 0.18  
                                 
Shares used in computing earnings per share:                                
  Basic     29,858       27,881       28,886       27,658  
  Diluted     30,800       28,870       29,982       28,458  
                                 
                                 
                                 
BUSINESS SEGMENT INFORMATION  
(In thousands)  
                         
    Three Months Ended     Year Ended  
    February 28,     February 28,  
    2013     2012     2013     2012  
    /---(Unaudited)---/              
Revenues                                
  Wireless DataCom   $ 37,325     $ 25,656     $ 139,503     $ 99,121  
  Satellite     11,066       11,965       41,076       39,607  
    Total revenues   $ 48,391     $ 37,621     $ 180,579     $ 138,728  
                                 
Gross profit                                
  Wireless DataCom   $ 13,219     $ 9,145     $ 50,005     $ 38,632  
  Satellite     1,831       1,448       6,888       3,387  
    Total gross profit   $ 15,050     $ 10,593     $ 56,893     $ 42,019  
                                 
Operating income (loss)                                
  Wireless DataCom   $ 3,951     $ 2,036     $ 16,844     $ 11,564  
  Satellite     784       599       3,111       (292 )
  Corporate expenses     (1,126 )     (1,004 )     (3,975 )     (3,902 )
    Total operating income   $ 3,609     $ 1,631     $ 15,980     $ 7,370  
                                 
                                 
   
CAL AMP CORP.  
CONSOLIDATED BALANCE SHEETS  
(In thousands)  
             
    February 28,     February 28,  
    2013     2012  
Assets                
Current assets:                
  Cash and cash equivalents   $ 63,101     $ 5,601  
  Accounts receivable, net     19,111       14,383  
  Inventories     13,516       10,057  
  Deferred income tax assets     6,400       5,425  
  Prepaid expenses and other current assets     4,641       4,323  
    Total current assets     106,769       39,789  
                 
Property, equipment and improvements, net     2,778       1,761  
                 
Deferred income tax assets, less current portion     34,616       6,412  
                 
Goodwill     1,112       -  
                 
Other intangible assets, net     4,603       2,738  
                 
Other assets     893       781  
                 
    $ 150,771     $ 51,481  
                 
Liabilities and Stockholders' Equity                
Current liabilities:                
  Current portion of long-term debt   $ 2,261     $ 1,100  
  Accounts payable     11,871       9,523  
  Accrued payroll and employee benefits     5,298       4,405  
  Deferred revenue     6,410       6,305  
  Other current liabilities     3,109       2,268  
                 
    Total current liabilities     28,949       23,601  
                 
Long-term debt     2,434       1,900  
Other non-current liabilities     1,839       1,003  
                 
Stockholders' equity:                
  Common stock     350       287  
  Additional paid-in capital     202,368       154,485  
  Accumulated deficit     (85,104 )     (129,730 )
  Accumulated other comprehensive loss     (65 )     (65 )
                 
    Total stockholders' equity     117,549       24,977  
                 
    $ 150,771     $ 51,481  
                 
   
   
CAL AMP CORP.  
CONSOLIDATED CASH FLOW STATEMENTS  
(In thousands)  
   
    Year Ended  
    February 28,  
    2013     2012  
Cash flows from operating activities:                
  Net income   $ 44,626     $ 5,218  
  Depreciation and amortization     2,764       2,447  
  Stock-based compensation expense     2,910       2,375  
  Non-cash interest expense     397       747  
  Write-off of cumulative foreign currency translation account     -       801  
  Deferred tax assets, net     (29,231 )     -  
  Changes in operating working capital     (4,883 )     825  
  Other     14       19  
                 
    Net cash provided by operating activities     16,597       12,432  
                 
Cash flows from investing activities:                
  Capital expenditures     (1,852 )     (1,076 )
  Navman Wireless asset purchase agreement     (1,000 )     -  
  Collections on note receivable     462       566  
  Other     (8 )     -  
                 
    Net cash used in investing activities     (2,398 )     (510 )
                 
Cash flows from financing activities:                
  Proceeds from issuance of common stock     44,784       -  
  Proceeds (repayments) of bank line of credit     -       (7,489 )
  Proceeds (repayments) of bank term loan     (1,200 )     3,000  
  Repayments of notes payable     (535 )     (5,000 )
  Payment of debt issue costs     -       (65 )
  Taxes paid related to net share settlement of vested equity awards     (2,560 )     (1,035 )
  Proceeds from exercise of stock options and warrants     2,812       27  
                 
    Net cash provided by (used in) financing activities     43,301       (10,562 )
                 
Net change in cash and cash equivalents     57,500       1,360  
                 
Cash and cash equivalents at beginning of period     5,601       4,241  
                 
Cash and cash equivalents at end of period   $ 63,101     $ 5,601  
                 
                 
 
CAL AMP CORP.
NON-GAAP EARNINGS RECONCILIATION
(Unaudited, in thousands except per share amounts)
 

"GAAP" refers to financial information presented in accordance with U.S. Generally Accepted Accounting Principles. 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 and Adjusted Basis Net Income 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 and Adjusted Basis Net Income 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 to Adjusted Basis (non-GAAP) Net Income is as follows
(in thousands except per share amounts):                                       

                         
    Three Months Ended     Year Ended  
    February 28,     February 28,  
    2013     2012     2013     2012  
                                 
GAAP basis pretax income   $ 3,407     $ 1,660     $ 15,448     $ 5,279  
                                 
Amortization of intangible assets     476       305       1,743       1,277  
Stock-based compensation expense     618       638       2,910       2,375  
Write-off of cumulative foreign currency translation account     -       -       -       801  
Acquisition expenses     305       -       305       -  
                                 
Pretax income (non-GAAP basis)     4,806       2,603       20,406       9,732  
                                 
Income tax provision (non-GAAP basis) (a)     (9 )     (18 )     (54 )     (61 )
                                 
Adjusted Basis net income   $ 4,797     $ 2,585     $ 20,352     $ 9,671  
                                 
Adjusted Basis net income per diluted share   $ 0.16     $ 0.09     $ 0.68     $ 0.34  
                                 
Weighted average common shares outstanding on diluted basis    
30,800
     
28,870
     
29,982
     
28,458
 
                                 
     
(a)
  The non-GAAP income tax provision reflects the income taxes paid/payable (or received/receivable) based on the non-GAAP pretax income for the period. The Company has net operating loss carryforwards to offset the pre-tax book income.
     
     

Contact Information

  • AT CALAMP:
    Garo Sarkissian
    VP, Corporate Development
    (805) 987-9000

    AT ADDO COMMUNICATIONS:
    Lasse Glassen
    (424) 238-6249
    lasseg@addocommunications.com