[May 09, 2018] |
|
PCTEL Reports $21.7 Million in First Quarter Revenue
PCTEL, Inc. (Nasdaq: PCTI), a leader in Performance Critical
TELecom solutions, announced its results for the first quarter
ended March 31, 2018.
Highlights from Continuing Operations
-
Revenue of $21.7 million in the quarter, in line with guidance,
down 5% from the first quarter last year. Connected Solutions segment
revenue was up 3%. RF Solutions segment revenue was down 30%, due to
deferred carrier capital budget deployment in North America.
-
Gross profit margin of 36.2% in the quarter, down 500 basis
points compared to last year. The primary reason for the decrease is
lower revenue in the RF Solutions segment which has higher margin from
its scanner products compared to antenna products. Price erosion in
the small cell antenna market also contributed to the decline.
-
Net loss per diluted share of $0.05 in the quarter, compared to
net income of $0.01 last year.
-
Non-GAAP net income and adjusted EBITDA are measures the Company
uses to reflect the results of its core earnings. A reconciliation
of those non-GAAP measures to our financial statements is provided
later in the press release.
-
Non-GAAP net loss per diluted share of $0.01, compared to
Non-GAAP net income per diluted share of $0.05 in the first
quarter last year.
-
Adjusted EBITDA margin as a percent of revenue of 2% in the
quarter, compared to 7% last year.
-
$34.7 million of cash and short-term investments and no debt at
March 31, 2018.
"The Company saw revenue growth for its Connected Solutions products in
the enterprise Wi-Fi market during the quarter. RF Solutions revenue was
down in the North American market, due to the slow release of capital
budget by several U.S. carriers," said David Neumann, PCTEL's CEO.
"PCTEL is well positioned to take advantage of the long-term growth
opportunities in Industrial IoT and 5G, which require both performance
critical antenna solutions across multiple vertical markets and RF test
equipment."
CONFERENCE CALL / WEBCAST
PCTEL's management team will discuss the Company's results today at 4:30
p.m. ET. The call can be accessed by dialing (888) 782-2072 (U.S.
/ Canada) or (706) 679-6397 (International), conference ID: 47850722.
The call will also be webcast at http://investor.pctel.com/news-events/webcasts-presentations.
REPLAY: A replay will be available for two weeks after the call on
either the website listed above or by calling (855) 859-2056
(U.S./Canada), or International (404) 537-3406, conference ID: 47850722.
About PCTEL
PCTEL, Inc. provides Performance Critical TELecom
technology solutions. We are a leading global supplier of antennas and
wireless network testing solutions. Our precision
antennas are deployed in small cells, enterprise Wi-Fi access
points, fleet management and transit systems, and in equipment and
devices for the Industrial Internet of Things (IIoT). We offer in-house
design, testing, radio integration, and manufacturing capabilities for
our antenna customers. PCTEL's test
and measurement tools improve the performance of wireless networks
globally, with a focus on LTE, public safety, and emerging 5G
technologies. Network operators, neutral hosts, and equipment
manufacturers rely on our scanning receivers and testing solutions to
analyze, design, and optimize their networks.
For more information, please visit our website at http://www.pctel.com/.
PCTEL Safe Harbor Statement
This press release and our related comments in our earnings conference
call contain "forward-looking statements" as defined in the Private
Securities Litigation Reform Act of 1995. Specifically, the statements
regarding our future financial performance, growth of our Connected
Solutions and RF Solutions businesses, anticipated demand for certain
products, our expectations regarding capital expenditures by U.S.
carriers, and the anticipated growth of public and private wireless
systems are forward-looking statements within the meaning of the safe
harbor. These statements are based on management's current expectations
and actual results may differ materially from those projected as a
result of certain risks and uncertainties, including the impact of data
densification and IoT on capacity and coverage demand, impact of 5G,
customer demand for these types of products and services generally,
growth and continuity in PCTEL's vertical markets, and PCTEL's ability
to grow its wireless products business and create, protect and implement
new technologies and solutions. These and other risks and uncertainties
are detailed in PCTEL's Securities and Exchange Commission filings.
These forward-looking statements are made only as of the date hereof,
and PCTEL disclaims any obligation to update or revise the information
contained in any forward-looking statement, whether as a result of new
information, future events or otherwise.
|
|
|
|
|
PCTEL, INC.
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(in thousands, except share data)
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
March 31,
|
|
December 31,
|
|
|
2018
|
|
2017
|
ASSETS
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
12,452
|
|
|
$
|
5,559
|
|
Short-term investment securities
|
|
|
22,285
|
|
|
|
32,499
|
|
Accounts receivable, net of allowances of $66 and $319 at March 31,
2018 and
December 31, 2017, respectively
|
|
|
19,026
|
|
|
|
18,624
|
|
Inventories, net
|
|
|
12,582
|
|
|
|
12,756
|
|
Prepaid expenses and other assets
|
|
|
1,874
|
|
|
|
1,605
|
|
Total current assets
|
|
|
68,219
|
|
|
|
71,043
|
|
Property and equipment, net
|
|
|
12,537
|
|
|
|
12,369
|
|
Goodwill
|
|
|
3,332
|
|
|
|
3,332
|
|
Intangible assets, net
|
|
|
1,823
|
|
|
|
2,113
|
|
Deferred tax assets, net
|
|
|
8,068
|
|
|
|
7,734
|
|
Other noncurrent assets
|
|
|
64
|
|
|
|
72
|
|
TOTAL ASSETS
|
|
$
|
94,043
|
|
|
$
|
96,663
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
5,226
|
|
|
$
|
5,471
|
|
Accrued liabilities
|
|
|
5,787
|
|
|
|
7,481
|
|
Total current liabilities
|
|
|
11,013
|
|
|
|
12,952
|
|
|
|
|
|
|
Long-term liabilities
|
|
|
485
|
|
|
|
392
|
|
|
|
|
|
|
Total liabilities
|
|
|
11,498
|
|
|
|
13,344
|
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
Common stock, $0.001 par value, 100,000,000 shares authorized,
18,258,643 and 17,806,792
shares issued and outstanding at March 31, 2018 and December 31,
2017, respectively
|
|
|
18
|
|
|
|
18
|
|
Additional paid-in capital
|
|
|
134,253
|
|
|
|
134,505
|
|
Accumulated deficit
|
|
|
(52,024
|
)
|
|
|
(51,258
|
)
|
Accumulated other comprehensive loss
|
|
|
298
|
|
|
|
54
|
|
Total stockholders' equity
|
|
|
82,545
|
|
|
|
83,319
|
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
$
|
94,043
|
|
|
$
|
96,663
|
|
|
|
|
|
|
|
|
|
|
PCTEL, INC.
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
|
(in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
March 31,
|
|
2018
|
|
2017
|
|
|
|
|
REVENUES
|
$
|
21,731
|
|
|
$
|
22,970
|
|
COST OF REVENUES
|
|
13,867
|
|
|
|
13,516
|
|
GROSS PROFIT
|
|
7,864
|
|
|
|
9,454
|
|
OPERATING EXPENSES:
|
|
|
|
Research and development
|
|
2,940
|
|
|
|
2,716
|
|
Sales and marketing
|
|
3,028
|
|
|
|
3,253
|
|
General and administrative
|
|
2,993
|
|
|
|
3,339
|
|
Amortization of intangible assets
|
|
124
|
|
|
|
124
|
|
Total operating expenses
|
|
9,085
|
|
|
|
9,432
|
|
OPERATING (LOSS) INCOME
|
|
(1,221
|
)
|
|
|
22
|
|
Other income, net
|
|
51
|
|
|
|
28
|
|
(LOSS) INCOME BEFORE INCOME TAXES
|
|
(1,170
|
)
|
|
|
50
|
|
Benefit for income taxes
|
|
(312
|
)
|
|
|
(134
|
)
|
NET (LOSS) INCOME FROM CONTINUING OPERATIONS
|
|
(858
|
)
|
|
|
184
|
|
NET LOSS FROM DISCONTINUED OPERATIONS, NET OF TAX BENEFIT
|
|
0
|
|
|
|
(214
|
)
|
NET LOSS
|
$
|
(858
|
)
|
|
$
|
(30
|
)
|
|
|
|
|
Net (Loss) Income per Share from Continuing Operations:
|
|
|
|
Basic
|
$
|
(0.05
|
)
|
|
$
|
0.01
|
|
Diluted
|
$
|
(0.05
|
)
|
|
$
|
0.01
|
|
|
|
|
|
Net Loss per Share from Discontinued Operations:
|
|
|
|
Basic
|
$
|
0.00
|
|
|
$
|
(0.01
|
)
|
Diluted
|
$
|
0.00
|
|
|
$
|
(0.01
|
)
|
|
|
|
|
Net Loss per Share:
|
|
|
|
Basic
|
$
|
(0.05
|
)
|
|
$
|
(0.00
|
)
|
Diluted
|
$
|
(0.05
|
)
|
|
$
|
(0.00
|
)
|
|
|
|
|
Weighted Average Shares:
|
|
|
|
Basic
|
|
17,056
|
|
|
|
16,340
|
|
Diluted
|
|
17,056
|
|
|
|
16,340
|
|
|
|
|
|
Cash dividend per share
|
$
|
0.055
|
|
|
$
|
0.05
|
|
|
|
|
|
|
|
|
|
PCTEL, INC.
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
.
|
|
2018
|
|
2017
|
|
|
|
|
|
Operating Activities:
|
|
|
|
|
Net (loss) income from continuing operations
|
|
$
|
(858
|
)
|
|
$
|
184
|
|
Adjustments to reconcile net loss to net cash provided by operating
activities:
|
|
|
|
|
Depreciation
|
|
|
674
|
|
|
|
628
|
|
Intangible asset amortization
|
|
|
290
|
|
|
|
290
|
|
Stock-based compensation
|
|
|
668
|
|
|
|
708
|
|
Loss on disposal of property and equipment
|
|
|
10
|
|
|
|
0
|
|
Restructuring costs
|
|
|
(11
|
)
|
|
|
(33
|
)
|
Bad debt provision
|
|
|
15
|
|
|
|
(7
|
)
|
Deferred tax provision
|
|
|
(236
|
)
|
|
|
(276
|
)
|
Changes in operating assets and liabilities:
|
|
|
|
|
Accounts receivable
|
|
|
(350
|
)
|
|
|
794
|
|
Inventories
|
|
|
321
|
|
|
|
1,790
|
|
Prepaid expenses and other assets
|
|
|
(250
|
)
|
|
|
319
|
|
Accounts payable
|
|
|
(64
|
)
|
|
|
(812
|
)
|
Income taxes payable
|
|
|
(3
|
)
|
|
|
(70
|
)
|
Other accrued liabilities
|
|
|
(1,808
|
)
|
|
|
(1,467
|
)
|
Deferred revenue
|
|
|
14
|
|
|
|
(12
|
)
|
Net cash (used in) provided by operating activities
|
|
|
(1,588
|
)
|
|
|
2,036
|
|
Investing Activities:
|
|
|
|
|
Capital expenditures
|
|
|
(884
|
)
|
|
|
(1,052
|
)
|
Proceeds from disposal of property and equipment
|
|
|
14
|
|
|
|
0
|
|
Purchases of investments
|
|
|
(7,266
|
)
|
|
|
(9,743
|
)
|
Redemptions/maturities of short-term investments
|
|
|
17,480
|
|
|
|
10,197
|
|
Net cash provided by (used in) investing activities
|
|
|
9,344
|
|
|
|
(598
|
)
|
Financing Activities:
|
|
|
|
|
Proceeds from issuance of common stock
|
|
|
364
|
|
|
|
330
|
|
Payment of withholding tax on stock-based compensation
|
|
|
(289
|
)
|
|
|
(614
|
)
|
Principle payments on capital leases
|
|
|
(24
|
)
|
|
|
(19
|
)
|
Cash dividends
|
|
|
(995
|
)
|
|
|
(865
|
)
|
Net cash used in financing activities
|
|
|
(944
|
)
|
|
|
(1,168
|
)
|
Cash flows from discontinued operations:
|
|
|
|
|
Net cash used in operating activities
|
|
|
0
|
|
|
|
(174
|
)
|
Net cash used in investing activities
|
|
|
0
|
|
|
|
(1
|
)
|
Net cash flows used in discontinued operations
|
|
|
0
|
|
|
|
(175
|
)
|
|
|
|
|
|
Net increase in cash and cash equivalents
|
|
|
6,812
|
|
|
|
95
|
|
Effect of exchange rate changes on cash
|
|
|
81
|
|
|
|
10
|
|
Cash and cash equivalents, beginning of year
|
|
|
5,559
|
|
|
|
14,855
|
|
Cash and Cash Equivalents, End of Period
|
|
$
|
12,452
|
|
|
$
|
14,960
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PCTEL, INC.
|
P&L INFORMATION BY SEGMENT - Continuing Operations (unaudited)
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, 2018
|
|
|
Connected
|
|
|
|
|
|
|
|
|
Solutions
|
|
RF Solutions
|
|
Corporate
|
|
Total
|
|
|
|
|
|
|
|
|
|
REVENUES
|
|
$
|
17,764
|
|
$
|
3,999
|
|
|
($32
|
)
|
|
$
|
21,731
|
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT
|
|
|
5,198
|
|
|
2,670
|
|
|
(4
|
)
|
|
|
7,864
|
|
|
|
|
|
|
|
|
|
|
OPERATING (LOSS) INCOME
|
|
$
|
1,605
|
|
|
($328
|
)
|
|
($2,498
|
)
|
|
|
($1,221
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, 2017
|
|
|
Connected
|
|
|
|
|
|
|
|
|
Solutions
|
|
RF Solutions
|
|
Corporate
|
|
Total
|
|
|
|
|
|
|
|
|
|
REVENUES
|
|
$
|
17,271
|
|
$
|
5,756
|
|
|
($57
|
)
|
|
$
|
22,970
|
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT
|
|
|
5,403
|
|
|
4,045
|
|
|
6
|
|
|
|
9,454
|
|
|
|
|
|
|
|
|
|
|
OPERATING INCOME (LOSS)
|
|
$
|
1,744
|
|
$
|
1,024
|
|
|
($2,746
|
)
|
|
$
|
22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to non-GAAP
Results - Continuing Operations (unaudited)
|
(in thousands except per share information)
|
|
|
|
|
|
|
|
Reconciliation of GAAP operating (loss)
income to non-GAAP operating (loss) income - Continuing Operations
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
2018
|
|
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating (Loss) Income
|
|
($1,221
|
)
|
|
$
|
22
|
|
|
|
|
|
|
|
|
(a)
|
|
Add:
|
|
|
|
|
|
|
Amortization of intangible assets
|
|
|
|
|
|
|
-Cost of revenues
|
|
167
|
|
|
|
167
|
|
|
|
-Operating expenses
|
|
124
|
|
|
|
124
|
|
|
|
Stock Compensation:
|
|
|
|
|
|
|
-Cost of revenues
|
|
88
|
|
|
|
61
|
|
|
|
-Engineering
|
|
138
|
|
|
|
146
|
|
|
|
-Sales & marketing
|
|
131
|
|
|
|
119
|
|
|
|
-General & administrative
|
|
311
|
|
|
|
382
|
|
|
|
|
|
959
|
|
|
|
999
|
|
|
|
Non-GAAP Operating (Loss) Income
|
|
($262
|
)
|
|
$
|
1,021
|
|
|
|
% of revenue
|
|
-1.2
|
%
|
|
|
4.4
|
%
|
|
|
|
|
|
|
|
Reconciliation of GAAP net (loss) income
to non-GAAP net (loss) income - Continuing Operations
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
2018
|
|
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
Net (Loss) Income
|
|
($858
|
)
|
|
$
|
184
|
|
|
|
|
|
|
|
|
|
|
Adjustments:
|
|
|
|
|
(a)
|
|
Non-GAAP adjustment to operating (loss) income
|
|
959
|
|
|
|
999
|
|
|
|
Income Taxes
|
|
(295
|
)
|
|
|
(323
|
)
|
|
|
|
|
664
|
|
|
|
676
|
|
|
|
Non-GAAP Net (Loss) Income
|
|
($194
|
)
|
|
$
|
860
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP (Loss) Income per Share:
|
|
|
|
|
|
|
Basic
|
|
($0.01
|
)
|
|
$
|
0.05
|
|
|
|
Diluted
|
|
($0.01
|
)
|
|
$
|
0.05
|
|
|
|
|
|
|
|
|
|
|
Weighed Average Shares:
|
|
|
|
|
|
|
Basic
|
|
17,056
|
|
|
|
16,340
|
|
|
|
Diluted
|
|
17,056
|
|
|
|
16,340
|
|
This schedule reconciles the Company's GAAP operating (loss) income
to its non-GAAP operating (loss) income. The Company believes that
presentation of this schedule provides meaningful supplemental
information to both management and investors that is indicative of
the Company's core operating results and facilitates comparison of
operating results across reporting periods. The Company uses these
non-GAAP measures when evaluating its financial results as well as
for internal planning and forecasting purposes. These non-GAAP
measures should not be viewed as a substitute for the Company's GAAP
results.
|
|
|
The adjustments to GAAP operating (loss) income (a) consist of
stock compensation expense and amortization of intangible assets.
The adjustments to GAAP net (loss) income include the non-GAAP
adjustments to operating (loss) income as well as adjustments for
(b) non-cash income tax expense.
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to non-GAAP
SEGMENT INFORMATION - Continuing Operations (unaudited)
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, 2018
|
|
|
Connected
|
|
RF
|
|
|
|
|
|
|
Solutions
|
|
Solutions
|
|
Corporate
|
|
Total
|
|
|
|
|
|
|
|
|
|
Operating (Loss) Income
|
|
$1,605
|
|
($328)
|
|
($2,498)
|
|
($1,221)
|
Add:
|
|
|
|
|
|
|
|
|
Amortization of intangible assets:
|
|
|
|
|
|
|
|
|
-Cost of revenues
|
|
0
|
|
167
|
|
0
|
|
167
|
-Operating expenses
|
|
39
|
|
85
|
|
0
|
|
124
|
Stock Compensation:
|
|
|
|
|
|
|
|
|
-Cost of revenues
|
|
46
|
|
42
|
|
0
|
|
88
|
-Engineering
|
|
74
|
|
64
|
|
0
|
|
138
|
-Sales & marketing
|
|
82
|
|
49
|
|
0
|
|
131
|
-General & administrative
|
|
60
|
|
23
|
|
228
|
|
311
|
|
|
301
|
|
430
|
|
228
|
|
959
|
Non-GAAP Operating (Loss) Income
|
|
$1,906
|
|
$102
|
|
($2,270)
|
|
($262)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, 2017
|
|
|
Connected
|
|
RF
|
|
|
|
|
|
|
Solutions
|
|
Solutions
|
|
Corporate
|
|
Total
|
|
|
|
|
|
|
|
|
|
Operating (Loss) Income
|
|
$1,744
|
|
$1,024
|
|
($2,746)
|
|
$22
|
Add:
|
|
|
|
|
|
|
|
|
Amortization of intangible assets:
|
|
|
|
|
|
|
|
|
-Cost of revenues
|
|
0
|
|
167
|
|
0
|
|
167
|
-Operating expenses
|
|
39
|
|
85
|
|
0
|
|
124
|
Stock Compensation:
|
|
|
|
|
|
|
|
|
-Cost of revenues
|
|
39
|
|
22
|
|
0
|
|
61
|
-Engineering
|
|
55
|
|
91
|
|
0
|
|
146
|
-Sales & marketing
|
|
85
|
|
34
|
|
0
|
|
119
|
-General & administrative
|
|
43
|
|
14
|
|
325
|
|
382
|
|
|
261
|
|
413
|
|
325
|
|
999
|
Non-GAAP Operating Income (Loss)
|
|
$2,005
|
|
$1,437
|
|
($2,421)
|
|
$1,021
|
This schedule reconciles the Company's GAAP operating (loss) income
by segment to its non-GAAP operating (loss) income. The Company
believes that presentation of this schedule provides meaningful
supplemental information to both management and investors that is
indicative of the Company's core operating results and facilitates
comparison of operating results across reporting periods. The
Company uses these non-GAAP measures when evaluating its financial
results as well as for internal planning and forecasting purposes.
These non-GAAP measures should not be viewed as a substitute for the
Company's GAAP results.
|
|
|
The adjustments to GAAP operating (loss) income consist of stock
compensation expense and amortization of intangible assets.
|
|
|
|
|
|
PCTEL, Inc.
|
Reconciliation of GAAP operating income
(loss) to Adjusted EBITDA - Continuing Operations
|
(unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
2018
|
|
2017
|
|
|
|
|
|
Operating (Loss) Income
|
|
|
($1,221
|
)
|
|
$
|
22
|
|
|
|
|
|
|
Add:
|
|
|
|
|
Depreciation and amortization
|
|
|
674
|
|
|
|
628
|
|
Intangible amortization
|
|
|
291
|
|
|
|
291
|
|
Stock compensation expenses
|
|
|
668
|
|
|
|
708
|
|
Adjusted EBITDA
|
|
$
|
412
|
|
|
$
|
1,649
|
|
% of revenue
|
|
|
1.9
|
%
|
|
|
7.2
|
%
|
This schedule reconciles the Company's GAAP operating (loss) income
to Adjusted EBITDA. The Company believes that this schedule provides
meaningful supplemental information to both management and investors
that is indicative of the Company's core operating results and
facilitates comparison of operating results across reporting
periods. The Company uses Adjusted EBITDA when evaluating its
financial results as well as for internal planning and forecasting
purposes. Adjusted EBITDA should not be viewed as a substitute for
the Company's GAAP results.
|
|
|
Adjusted EBITDA is defined as net income before interest, income
taxes, depreciation and amortization. The adjustments on this
schedule consist of depreciation, amortization of intangible assets,
and stock compensation expenses
|
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20180509006182/en/
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