CalAmp Reports Fiscal 2014 Second Quarter Results

Marketwired

OXNARD, CA--(Marketwired - Oct 2, 2013) -  CalAmp Corp. (NASDAQ: CAMP), a leading provider of wireless products, services and solutions, today reported results for its second quarter ended August 31, 2013. Highlights for the quarter include:

  • Consolidated second quarter revenue of $58.8 million, up 34% compared to the second quarter last year with Wireless Datacom revenue up 38% over prior year second quarter to $47.2 million.
  • Second quarter GAAP net income of $2.8 million, or $0.08 per diluted share, compared to $3.7 million, or $0.12 per diluted share, for the second quarter last year.
  • Adjusted Basis (non-GAAP) net income of $6.8 million, or $0.19 per diluted share, compared to $4.9 million, or $0.17 per diluted share, for the same period last year.
  • Net cash provided by operations for the second quarter of $8.0 million, and total cash balance at August 31, 2013 of $29.7 million.

Commenting on results in the latest quarter, Michael Burdiek, CalAmp's President and Chief Executive Officer, said, "I am very pleased with our second quarter performance, particularly the strong revenue growth and solid profitability. Our focused execution coupled with continued strong customer demand for our products and services resulted in a 38% year-over-year increase in Wireless Datacom revenue during the second quarter. This growth was driven to a large extent by our Mobile Resource Management (MRM) products business, which benefited from significant channel demand for stolen vehicle recovery products, along with continued strength in fleet management and asset tracking. Our Wireless Networks business, which comprises the remainder of our Wireless Datacom segment, also generated strong year-over-year growth. The acquired operations of Wireless Matrix, along with growth in the Energy vertical, more than offset a year-over-year reduction in Rail revenue resulting from the completion of our Positive Train Control development project in the second quarter last year. In addition, our Satellite segment once again generated meaningful operating cash flow and contributed to our bottom-line profitability. We believe CalAmp's strong momentum exiting the second quarter and healthy pipeline of new opportunities, driven by an expanding network of global channel partners and a robust portfolio of innovative products, provide the Company with a strong tailwind as we enter the second half of fiscal 2014." 

Fiscal 2014 Second Quarter Results
Total revenue for the fiscal 2014 second quarter was $58.8 million compared to $44.0 million for the second quarter of fiscal 2013, an increase of 34%. Wireless Datacom revenue increased to $47.2 million from $34.2 million in the same period last year, and Satellite revenue was $11.6 million compared to $9.8 million in the second quarter last year.

Consolidated gross profit for the fiscal 2014 second quarter was $19.8 million, an increase of $5.7 million over the same quarter last year, primarily attributable to higher revenue. The consolidated gross margin was 33.7% in the fiscal 2014 second quarter, up from 32.1% in the second quarter last year. The increase in consolidated gross margin reflects the higher proportion of total revenues represented by the Wireless Datacom segment in fiscal 2014 versus the prior year and, within Wireless Datacom, the shift in revenue mix toward higher margin subscription-based revenues associated with the Wireless Matrix acquisition.

GAAP net income for the fiscal 2014 second quarter was $2.8 million, or $0.08 per diluted share, compared to net income of $3.7 million, or $0.12 per diluted share, in the second quarter of last year. The lower GAAP net income is due to higher intangibles amortization expense in the current year associated with the acquisition of Wireless Matrix, and to the elimination of substantially all of the Company's deferred income tax asset valuation allowance at the end of fiscal 2013 that caused GAAP basis income tax expense to revert to a level that reflects full statutory tax rates beginning in the first quarter of fiscal 2014. Despite this, on a cash basis, the Company's pretax income is still largely sheltered from taxation by net operating loss (NOL) carryforwards, and is expected to remain so for the next few years.

Non-GAAP net income for the fiscal 2014 second quarter was $6.8 million, or $0.19 per diluted share, compared to non-GAAP net income of $4.9 million, or $0.17 per diluted share, for the same quarter last year. Non-GAAP earnings excludes the impact of intangibles amortization and stock-based compensation, and includes income tax expense that reflects cash taxes paid or payable for the period after giving effect to the utilization of NOL and tax credit carryforwards. 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
As of August 31, 2013, the Company had total cash of $29.7 million and an outstanding bank term loan of $4.6 million. Net cash provided by operating activities during the second quarter was $8.0 million, and the unused borrowing capacity on the bank revolver as of the end of the second quarter was $10.4 million.

Business Outlook
Commenting on the Company's business outlook, Mr. Burdiek said, "Based on our latest projections, we expect our fiscal 2014 third quarter consolidated revenues to be in the range of $59 to $63 million. We anticipate that Wireless Datacom third quarter revenues will increase on a sequential basis partly driven by emerging demand for insurance telematics products. We expect Satellite third quarter revenues to be relatively flat on a sequential basis, but up significantly year-over-year. At the bottom line, we expect third quarter GAAP basis net income in the range of $0.07 to $0.10 per diluted share, and non-GAAP net income in the range of $0.19 to $0.23 per diluted share."

Conference Call and Webcast
A conference call and simultaneous webcast to discuss second quarter 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 # 10000293. An audio replay will be available through October 9, 2013 by calling 1-877-870-5176 or 1-858-384-5517 and entering the Conference ID # 10000293.

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 (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 reporting business critical data and desired intelligence from high-value 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 and any potential adverse effects associated with the federal government shutdown, 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 on April 25, 2013 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 INCOME STATEMENTS 
(Unaudited, in thousands except per share amounts) 
 
    Three Months Ended     Six Months Ended  
    August 31,     August 31,  
    2013     2012     2013     2012  
                                 
Revenues   $ 58,807     $ 43,987     $ 112,553     $ 87,848  
Cost of revenues     38,968       29,852       74,233       60,037  
Gross profit     19,839       14,135       38,320       27,811  
Operating expenses:                                
  Research and development     5,296       3,657       10,454       6,829  
  Selling     4,884       3,173       9,869       5,981  
  General and administrative     3,418       3,052       7,230       6,150  
  Intangible asset amortization     1,484       475       3,133       792  
      15,082       10,357       30,686       19,752  
                                 
Operating income     4,757       3,778       7,634       8,059  
Non-operating expense, net     (81 )     (102 )     (250 )     (192 )
Income before income taxes     4,676       3,676       7,384       7,867  
Income tax provision     (1,832 )     (17 )     (2,855 )     (26 )
Net income   $ 2,844     $ 3,659     $ 4,529     $ 7,841  
                                 
Earnings per share - basic and diluted                                
  Basic   $ 0.08     $ 0.13     $ 0.13     $ 0.28  
  Diluted   $ 0.08     $ 0.12     $ 0.13     $ 0.27  
                                 
Shares used in computing earnings per share:                                
  Basic     34,808       28,476       34,687       28,201  
  Diluted     35,833       29,692       35,748       29,478  
                                 
                                 
 
BUSINESS SEGMENT INFORMATION 
(Unaudited, in thousands) 
 
    Three Months Ended     Six Months Ended  
    August 31,     August 31,  
    2013     2012     2013     2012  
Revenues                                
  Wireless DataCom   $ 47,196     $ 34,173     $ 88,061     $ 65,844  
  Satellite     11,611       9,814       24,492       22,004  
    Total revenues   $ 58,807     $ 43,987     $ 112,553     $ 87,848  
                                 
Gross profit                                
  Wireless DataCom   $ 17,555     $ 12,429     $ 33,515     $ 24,174  
  Satellite     2,284       1,706       4,805       3,637  
    Total gross profit   $ 19,839     $ 14,135     $ 38,320     $ 27,811  
                                 
Operating income                                
  Wireless DataCom   $ 4,314     $ 4,002     $ 6,680     $ 8,393  
  Satellite     1,228       749       2,776       1,829  
  Corporate expenses     (785 )     (973 )     (1,822 )     (2,163 )
    Total operating income   $ 4,757     $ 3,778     $ 7,634     $ 8,059  
                                 
                                 
   
CAL AMP CORP.  
CONSOLIDATED BALANCE SHEETS  
(In thousands)  
             
    August 31,     February 28,  
    2013     2013  
Assets   (Unaudited)        
Current assets:                
  Cash and cash equivalents   $ 29,678     $ 63,101  
  Accounts receivable, net     27,556       19,111  
  Inventories     14,162       13,516  
  Deferred income tax assets     6,640       6,400  
  Prepaid expenses and other current assets     4,966       4,641  
                     
    Total current assets     83,002       106,769  
                     
Property, equipment and improvements, net     4,421       2,778  
Deferred income tax assets, less current portion     31,580       34,616  
Goodwill     18,304       1,112  
Other intangible assets, net     27,090       4,603  
Other assets     1,469       893  
                 
    $ 165,866     $ 150,771  
                 
Liabilities and Stockholders' Equity            
Current liabilities:                
  Current portion of long-term debt   $ 2,440     $ 2,261  
  Accounts payable     20,188       11,871  
  Accrued payroll and employee benefits     4,838       5,298  
  Deferred revenue     6,698       6,410  
  Other current liabilities     3,234       3,109  
                 
    Total current liabilities     37,398       28,949  
                 
Long-term debt     4,689       2,434  
Other non-current liabilities     2,232       1,839  
                 
Stockholders' equity:                
  Common stock     354       350  
  Additional paid-in capital     201,833       202,368  
  Accumulated deficit     (80,575 )     (85,104 )
  Accumulated other comprehensive loss     (65 )     (65 )
                 
    Total stockholders' equity     121,547       117,549  
                 
    $ 165,866     $ 150,771  
                 
   
   
CAL AMP CORP.  
CONSOLIDATED CASH FLOW STATEMENTS  
(Unaudited - In thousands)  
   
    Six Months Ended  
    August 31,  
    2013     2012  
Cash flows from operating activities:                
  Net income   $ 4,529     $ 7,841  
  Depreciation and amortization     4,015       1,260  
  Stock-based compensation expense     1,321       1,672  
  Amortization of debt issue costs and discount     147       22  
  Deferred tax assets, net     2,796       (85 )
  Changes in operating working capital     1,002       (3,517 )
  Other     -       15  
                 
    Net cash provided by operating activities     13,810       7,208  
                 
Cash flows from investing activities:                
  Capital expenditures     (841 )     (920 )
  Navman Wireless asset purchase agreement     -       (1,000 )
  Wireless Matrix acquisition, net of cash acquired     (46,837 )     -  
  Collections on note receivable     -       283  
                 
    Net cash used in investing activities     (47,678 )     (1,637 )
                 
Cash flows from financing activities:                
  Proceeds from bank term loan     5,000       -  
  Debt repayments     (2,703 )     (500 )
  Taxes paid related to net share settlement of vested equity awards     (2,991 )     (2,515 )
  Proceeds from exercise of stock options and warrants     1,139       2,078  
                 
    Net cash provided (used) by financing activities     445       (937 )
                 
Net change in cash and cash equivalents     (33,423 )     4,634  
                 
Cash and cash equivalents at beginning of period     63,101       5,601  
                 
Cash and cash equivalents at end of period   $ 29,678     $ 10,235  
                 
 
 
CAL AMP CORP.
NON-GAAP EARNINGS RECONCILIATION
(Unaudited)

"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     Six Months Ended  
    August 31,     August 31,  
    2013     2012     2013     2012  
                                 
GAAP basis pretax income   $ 4,676     $ 3,676     $ 7,384     $ 7,867  
                                 
Amortization of intangible assets     1,484       475       3,133       792  
Stock-based compensation expense     690       814       1,321       1,672  
Acquisition and integration expenses     -       -       637       -  
                                 
Pretax income (non-GAAP basis)     6,850       4,965       12,475       10,331  
                                 
Income tax provision (non-GAAP basis) (a)     (32 )     (51 )     (64 )     (111 )
                                 
Adjusted Basis net income   $ 6,818     $ 4,914     $ 12,411     $ 10,220  
                                 
Adjusted Basis net income per diluted share   $ 0.19     $ 0.17     $ 0.35     $ 0.35  
                                 
Weighted average common shares outstanding on diluted basis     35,833       29,692       35,748       29,478  
   
 (a) The non-GAAP income tax provision represents cash taxes paid for the period after giving effect to the utilization of net operating loss and tax credit carryforwards.
   
Contact:
AT CALAMP:
Garo Sarkissian
SVP, Corporate Development
(805) 987-9000

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

Rates

View Comments (1)

Recommended for You

  • Tycoon buys 30 Rolls-Royces for Macau hotel

    A Hong Kong tycoon has placed the biggest ever order for Rolls-Royce cars, agreeing to buy 30 Phantoms to chauffeur guests at a luxury resort he's building in the global gambling capital of Macau. Stephen Hung's $20 million purchase surpasses the 14 Phantoms bought by Hong Kong's Peninsula Hotel in…

    Associated Press
  • Accomplish your career goals

    At Capella University, you can learn the skills you need to succeed. Why wait another day? Get started today.

    AdChoicesCapella UniversitySponsored
  • Tycoon's arrest sends shock wave through Russia

    Tycoon's arrest sends shock wave through Russia MOSCOW (AP) — The arrest of a Russian telecoms and oil tycoon has sent shock waves through the country's business community, with some fearing a return to the dark days of a decade ago, when the Kremlin asserted its power by imprisoning the country's…

    Associated Press
  • Before You Buy Alibaba, Check Out 4 Top China Stocks

    Before You Buy Alibaba, Check Out 4 Top China Stocks While investors gear up for Alibaba Group 's (BABA) hotly anticipated initial public offering, don't forget about other Chinese stocks that are worth keeping an eye on. Today's Young Guns Screen of

    Investor's Business Daily
  • Play

    Citi, Bank of America Offer Discounted Mortgages

    Citigroup and Bank of America will offer mortgages at discounted interest rates to help borrowers with low incomes or subprime credit. AnnaMaria Andriotis joins MoneyBeat. Photo: Getty.

    WSJ Live
  • Costco Stores in Canada to Stop Taking American Express

    “The credit card relationship between American Express and Costco Wholesale Canada will not be renewed when it expires” on Dec. 31, the company said today in an e-mail to Canadian customers. The message was attributed to Lorelle Gilpin, vice president of marketing and membership for Costco…

    Bloomberg
  • "The Retiree Next Door": How successful retirees stretch their savings

    "The Retiree Next Door": How successful retirees stretch their savingsBy the time she hit her late 40s, Toni Eugenia wasn’t sure she would ever be able to retire. Eugenia, 56, a pharmacy technician who lived in Houston, was nearly $200,000 in debt and

    Yahoo Finance
  • As Fed takes baby steps, Cramer's trick for profit

    In turn, Cramer says making money in the market, involves looking at the environment through the lens of the Fed. "The trick is to remember that they speak for the common person," Cramer said. "The Fed wants the common person to make money." With that backdrop always in mind, Cramer says it becomes…

    CNBC
  • 1 Tip To Lose Belly Fat

    It's Hollywood's Hottest Diet And Gets Rid Of Stubborn Fat Areas Like Nothing Else.

    AdChoicesagoodcooksSponsored
  • CNBC Anchor Calls Out Fed-Hater Bill Fleckenstein In Startling Shouting Match

    CNBC Bill Fleckenstein of Fleckenstein Capital appeared on CNBC's Futures Now program on Tuesday. Futures Now host Jackie DeAngelis came out swinging, asking Fleckenstein right at the top if he was willing to admit that he had misunderstood monetary policy. Sounding taken aback, Fleckenstein…

    Business Insider
  • Beanie Babies creator's sentence debated in court

    Beanie Babies creator's sentence debated in court CHICAGO (AP) — Federal prosecutors seeking to put the billionaire creator of Beanie Babies in prison for hiding millions in Swiss bank accounts told appellate court judges Wednesday that the toymaker's sentence of probation threatens to erode the…

    Associated Press
  • Apple to unveil new iPads, operating system on Oct. 21 : report

    The company plans to unveil the sixth generation of its iPad and the third edition of the iPad mini, as well as its operating system OS X Yosemite, which has undergone a complete visual overhaul, the Internet news website said. Trudy Muller, a spokeswoman for Apple, declined to comment. The iPad is…

    Reuters
  • Gilead Stock Is Falling On These Drug Setbacks

    Gilead Stock Is Falling On These Drug Setbacks Gilead Sciences (GILD) shares are backsliding Wednesday on news that the patient drop-out rate for hepatitis C drug Sovaldi is quadruple that of clinical trials. In addition, the biotech's Phase 2 study results

    Investor's Business Daily
  • Margaritaville casino owners seek bankruptcy

    The owner of Biloxi's Margaritaville casino has filed for Chapter 11 bankruptcy protection Tuesday, only hours before a hearing where the landlord aimed to seize the property. The filing by MVB Holding LLC in U.S. Don Dornan, a lawyer for landlord Clay Point LLC, said the company had planned to ask…

    Associated Press
  • Here's What Mark Cuban Wishes He Knew About Money In His 20s

    Cuban is the owner of the Dallas Mavericks basketball team. Billionaire investor and entrepreneur Mark Cuban is generous with his advice. When we asked him what he wishes he'd known about money in his 20s, he said:

    Business Insider
  • Master's Degree in Nursing

    CCNE accredited MS in nursing in as few as 18 months online. Learn more today!

    AdChoicesNorwich UniversitySponsored
  • Embraer to sell 50 E-175 jets to Republic in $2.1 billion deal

    Brazil's Embraer SA, the world's third largest commercial planemaker, said on Wednesday it booked a firm order from U.S. The deal, which will be included in Embraer's order book for the third quarter, is valued at $2.1 billion, the planemaker said in a securities filing. The planes will be operated…

    Reuters
  • SHOE COMPANY: Our CEO Just Disappeared And Most Of The Money Is Gone

    "and like that: he's gone." This is an actual headline from a company press release: "CEO and COO disappeared, most of the company's cash missing." (Via FastFT) In a statement, German-based shoe company Ultrasonic said its CFO,  Chi Kwong Clifford Chan, has been unable to reach the company's CEO,…

    Business Insider
  • Don't buy Alibaba stock: 'Dean of Valuation'

    Investors should steer clear of Alibaba , valuation expert Aswath Damodaran said Wednesday. On CNBC's " Fast Money ," Damodaran, a professor of finance at New York University's Stern School of Business, noted that he was looking at Alibaba stock from the perspective of a long-term investor, not a…

    CNBC
  • Billionaire Investor Says Chinese People Work Harder And Western Companies Could Face Deep Trouble After Alibaba IPO

    Michael Moritz, the chairman of VC firm Sequoia Capital, is a huge fan of Chinese internet companies and reiterated his enthusiasm for the Chinese market in an interview with The Wall Street Journal Wednesday. The billionaire investor described the Alibaba IPO as a “major landmark event” that is as…

    Business Insider
  • Play

    What the Fed Meeting Means for Bonds

    Janet Yellen & Co. are expected to hint at their timetable for raising interest rates. Here's how investors should prepare ahead of the meeting.

    WSJ Live
  • Top Analyst Upgrades and Downgrades: AEP, BHP, GE, Incyte, 3M, Tyco, Under Armour and More

    Top Analyst Upgrades and Downgrades: AEP, BHP, GE, Incyte, 3M, Tyco, Under Armour and More Stocks were firm on Wednesday morning ahead of the FOMC meeting outcome. Tuesday’s rally may have sparked higher interest again, and investors are looking for bargains

    24/7 Wall St.
  • Norwich Information Security MS

    Online, accredited, top ranked. NSA Center of Academic Excellence. Recognized by the Department of Homeland Security. Download your free brochure!

    AdChoicesNorwich UniversitySponsored
  • 6 Things Debt Collectors Wish You Knew

    The work debt collectors do is not popular, and has become increasingly derided by those who don’t like what we do or simply don’t know the facts about debt collection. Too often, debt collection is painted with a broad brush to create a portrait that isn’t accurate, and doesn’t properly educate…

    Credit.com