Delaware
|
001-13279
|
95-4647021
|
|||
(State or other jurisdiction
of incorporation)
|
(Commission file number)
|
(I.R.S. Employer
Identification Number)
|
|||
6001 36th Avenue West
Everett, Washington
www.intermec.com
|
98203-1264
|
||||
(Address of principal executive offices and internet site)
|
(Zip Code)
|
||||
Item 2.02
|
Results of Operations and Financial Condition.
|
●
|
loss from operations before taxes
|
●
|
net loss
|
●
|
loss per diluted share, and
|
●
|
gross margin.
|
Item 9.01
|
Financial Statements and Exhibits.
|
Exhibit
Number
|
Description
|
|
99.1
|
Press release issued by Intermec, Inc. on May 4, 2011
|
Date: May 4, 2011
|
By: /s/ Robert J. Driessnack
Robert J. Driessnack
Senior Vice President and Chief Financial Officer
|
Intermec, Inc.
6001 36Pth Avenue West
Everett, WA 98203-1264
TUwww.intermec.comUTH
|
§
|
Revenue increases 20% to $179 Million; up 13% before acquisitions
|
§
|
International growth of 34%
|
§
|
Cash flow from operations positive $2.3 Million
|
Quarter Ended April 3, 2011
|
Quarter Ended March 28, 2010
|
|||||||||||||||||||||||
($ in millions, except per share amounts)
|
Loss before
income tax
|
Net loss
|
Loss per share
|
Loss before
income tax
|
Net loss
|
Loss per share
|
||||||||||||||||||
Loss as reported
|
$ | (9.0 | ) | $ | (6.1 | ) | $ | (0.10 | ) | $ | (6.2 | ) | $ | (3.6 | ) | $ | (0.06 | ) | ||||||
Acquisition related costs
|
4.8 | 3.8 | 0.06 | - | - | - | ||||||||||||||||||
Acquisition adjustments
|
3.0 | 1.9 | 0.03 | - | - | - | ||||||||||||||||||
Impairment of facility
|
- | - | - | 2.4 | 1.4 | 0.02 | ||||||||||||||||||
Restructuring charges
|
- | - | - | 0.7 | 0.4 | 0.01 | ||||||||||||||||||
Loss as adjusted
|
$ | (1.2 | ) | $ | (0.4 | ) | $ | (0.01 | ) | $ | (3.1 | ) | $ | (1.8 | ) | $ | (0.03 | ) |
§
|
Total revenue of $179 million increased 20% from the prior-year quarter including approximately $10 million, or 7% from one month of Vocollect revenues. Total revenues increased 19% when adjusted for currency translation.
|
§
|
First quarter 2011 Vocollect revenues are included in each geographic region, and in the product line view in the Systems and Solutions and Services results, as appropriate.
|
§
|
Geographically, compared to the prior-year quarter, revenues in North America increased 5%. In Europe, Middle East and Africa (EMEA) revenues increased 30%. On a constant currency basis in EMEA revenues increased 31%. The rest of world improved by 44%, led by 53% growth in Latin America and 33% growth in APAC.
|
§
|
Systems and Solutions revenue grew 23%; Printer and Media revenue increased 19%; and Service revenue increased 12%, all as compared to the prior-year quarter.
|
§
|
Total gross profit margin as reported was 38.3% up from a comparable 37.6% in the prior-year quarter. Excluding the impact of $1.2 million of acquisition-related inventory costs, $1.1 million of intangibles amortization and $0.7 million of deferred revenue and acquisition-related adjustments, total gross margins were 39.8%.
|
§
|
Product gross margins as reported were 38.6% compared to 37.4% in first quarter 2010. Excluding the acquisition-related inventory costs of $1.2 million and acquisition-related intangibles amortization of $1.1 million, product gross margins were 40.2%. Service gross margins as reported were 36.8% compared to 38.4% in first quarter 2010. Excluding the $0.7 million of deferred revenue acquisition adjustments, service gross margins were 38.0%.
|
§
|
Total operating expenses for the quarter were $76.9 million, which includes $6.4 million of expenses from Vocollect operations and acquisition-related expenses of $4.8 million. That compares to prior-year operating expenses of $62.1 million, which included facility impairment and restructuring charges of $2.4 million and $0.7 million, respectively. On a comparable basis, core Intermec operating expenses were $65.7 million in the 2011 quarter versus $59.0 million in the 2010 quarter. The increase reflects increased selling and marketing initiatives and new product development and launch costs, which contributed to the 13% organic revenue growth year-over-year.
|
§
|
The Company generated positive cash flow from operations of $2.3 million during the quarter. Cash, cash equivalents, and short-term investments totaled approximately $124 million at quarter-end.
|
§
|
In the quarter, Intermec repurchased approximately 429 thousand shares of its outstanding common stock at a total cost of $4.5 million or $10.56 per share. Subsequent to the end of the first quarter the Company repurchased an additional approximately 507 thousand shares for $5.5 million or $10.81 per share. Following completion of this $10 million program there is approximately $45 million remaining under our share repurchase authorization.
|
§
|
As a subsequent event, the Company announced a plan to streamline certain non-U.S. service depots and support operations. These actions are expected to impact approximately 2% of employee headcount and are intended primarily to improve the Company’s services cost structure and margins. The actions are expected to occur during 2011, with an annualized improvement of approximately $3.0 million in cost savings.
|
§
|
The Company expects to record approximately $4.5 to $5.0 million of restructuring and related charges in 2011 for this cost reduction plan. The restructuring charges are primarily severance-related and are expected to be 80% of the total cost. Restructuring-related charges include consulting, training and other transition costs. Almost all of the charges will be cash-related. Approximately $4.0 million is expected to be recorded in the second quarter.
|
§
|
Q2’11 revenues are expected to be within a range of $205 to $215 million, including a full quarter of revenues from our Vocollect and Enterprise Mobile businesses.
|
§
|
Q2’11 GAAP EPS is expected to be within a range of ($0.04) to breakeven per diluted share.
|
§
|
Q2’11 Non-GAAP EPS is expected to be within a range of $0.08 to $0.12 per diluted share, excluding the impact of approximately: restructuring and restructuring-related charges of $4.0 million, acquisition-related costs of $0.9 million, amortization of acquired intangibles of $3.3 million and deferred services revenue acquisition-related adjustments of $2.2 million.
|
INTERMEC, INC.
|
||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
(In thousands, except per share amounts)
|
||||||||
(Unaudited)
|
||||||||
Three Months Ended
|
||||||||
April 3, 2011
|
March 28, 2010
|
|||||||
Revenues:
|
||||||||
Product
|
$ | 141,736 | $ | 116,358 | ||||
Service
|
36,782 | 32,872 | ||||||
Total revenues
|
178,518 | 149,230 | ||||||
Costs and expenses:
|
||||||||
Cost of product revenues
|
86,964 | 72,871 | ||||||
Cost of service revenues
|
23,260 | 20,260 | ||||||
Research and development
|
17,815 | 15,543 | ||||||
Selling, general and administrative
|
54,242 | 43,426 | ||||||
Acquisition costs
|
4,839 | - | ||||||
Restructuring charges
|
- | 737 | ||||||
Impairment of facility
|
- | 2,421 | ||||||
Total costs and expenses
|
187,120 | 155,258 | ||||||
Operating loss
|
(8,602 | ) | (6,028 | ) | ||||
Interest income
|
98 | 150 | ||||||
Interest expense
|
(511 | ) | (345 | ) | ||||
Loss before income taxes
|
(9,015 | ) | (6,223 | ) | ||||
Income tax benefit
|
(2,938 | ) | (2,578 | ) | ||||
Net loss
|
$ | (6,077 | ) | $ | (3,645 | ) | ||
Basic loss per share
|
$ | (0.10 | ) | $ | (0.06 | ) | ||
Diluted loss per share
|
$ | (0.10 | ) | $ | (0.06 | ) | ||
Shares used in computing basic loss per share
|
60,367 | 61,841 | ||||||
Shares used in computing diluted loss per share
|
60,367 | 61,841 |
INTERMEC, INC.
|
||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS
|
||||||||
(In thousands)
|
||||||||
(Unaudited)
|
||||||||
|
||||||||
April 3, 2011
|
December 31, 2010
|
|||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | 117,117 | $ | 221,467 | ||||
Short-term investments
|
6,980 | 6,788 | ||||||
Accounts receivable, net
|
121,756 | 110,455 | ||||||
Inventories, net
|
88,054 | 82,657 | ||||||
Current deferred tax assets, net
|
55,689 | 45,725 | ||||||
Other current assets
|
22,839 | 17,864 | ||||||
Total current assets
|
412,435 | 484,956 | ||||||
Deferred tax assets, net
|
160,458 | 194,597 | ||||||
Goodwill
|
137,381 | 1,152 | ||||||
Other acquired intangibles, net
|
88,359 | 3,031 | ||||||
Property, plant and equipment, net
|
47,872 | 36,320 | ||||||
Other assets
|
33,599 | 29,209 | ||||||
Total assets
|
$ | 880,104 | $ | 749,265 | ||||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$ | 78,918 | $ | 72,120 | ||||
Payroll and related expenses
|
26,130 | 20,155 | ||||||
Deferred revenue
|
56,177 | 36,227 | ||||||
Accrued expenses
|
23,252 | 24,949 | ||||||
Total current liabilities
|
184,477 | 153,451 | ||||||
Long-term debt
|
97,000 | - | ||||||
Pension and other postretirement benefits liabilities
|
95,208 | 95,922 | ||||||
Long-term deferred revenue
|
29,344 | 23,752 | ||||||
Other long-term liabilities
|
15,302 | 14,911 | ||||||
Commitments and contingencies
|
||||||||
Shareholders' equity:
|
||||||||
Common stock (250,000 shares authorized, 62,653 and 62,594 shares issued, and 59,817 and 60,191 outstanding)
|
627 | 625 | ||||||
Additional paid-in capital
|
692,595 | 694,291 | ||||||
Accumulated deficit
|
(185,647 | ) | (179,570 | ) | ||||
Accumulated other comprehensive loss
|
(48,802 | ) | (54,117 | ) | ||||
Total shareholders' equity
|
458,773 | 461,229 | ||||||
Total liabilities and shareholders' equity
|
$ | 880,104 | $ | 749,265 |
INTERMEC, INC.
|
||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
(In thousands)
|
||||||||
(Unaudited)
|
||||||||
Three Months Ended
|
||||||||
April 3, 2011
|
March 28, 2010
|
|||||||
Cash and cash equivalents at beginning of the period
|
$ | 221,467 | $ | 201,884 | ||||
Cash flows from operating activities:
|
||||||||
Net loss
|
(6,077 | ) | (3,645 | ) | ||||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
|
||||||||
Depreciation and amortization
|
4,907 | 3,746 | ||||||
Impairment of facility
|
- | 2,421 | ||||||
Deferred taxes
|
(4,383 | ) | (3,230 | ) | ||||
Stock-based compensation
|
2,328 | 1,905 | ||||||
Changes in operating assets and liabilities:
|
||||||||
Accounts receivable
|
13,152 | 4,129 | ||||||
Inventories
|
2,357 | 5,727 | ||||||
Accounts payable and accrued expenses
|
(16,582 | ) | (21,485 | ) | ||||
Payroll and related expenses
|
4,409 | (1,514 | ) | |||||
Deferred revenue
|
6,705 | 3,172 | ||||||
Other operating activities
|
(4,469 | ) | 915 | |||||
Net cash provided by (used in) operating activities
|
2,347 | (7,859 | ) | |||||
Cash flows from investing activities:
|
||||||||
Acquisitions, net of cash acquired
|
(199,018 | ) | - | |||||
Additions to property, plant and equipment
|
(4,115 | ) | (2,890 | ) | ||||
Other investing activities
|
(371 | ) | (842 | ) | ||||
Net cash used in investing activities
|
(203,504 | ) | (3,732 | ) | ||||
Cash flows from financing activities: | ||||||||
Proceeds from issuance of debt
|
97,000 | - | ||||||
Stock repurchase
|
(4,535 | ) | - | |||||
Stock options exercised and other
|
524 | 554 | ||||||
Net cash provided by financing activities
|
92,989 | 554 | ||||||
Effect of exchange rate changes on cash and cash equivalents
|
3,818 | (1,985 | ) | |||||
Resulting decrease in cash and cash equivalents
|
(104,350 | ) | (13,022 | ) | ||||
Cash and cash equivalents at end of the period
|
$ | 117,117 | $ | 188,862 |
INTERMEC, INC.
|
|||||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP NET EARNINGS
|
|||||||||||||||||||
(In thousands, except per share amounts) | |||||||||||||||||||
(Unaudited)
|
|||||||||||||||||||
Three Months Ended April 3, 2011
|
||||||||||||
As Reported
|
Non-GAAP Adjustments
|
Non-GAAP As Adjusted
|
||||||||||
Total revenues
|
$ | 178,518 | $ | 726 | $ | 179,244 | ||||||
Costs and expenses:
|
||||||||||||
Cost of revenues
|
110,224 | (2,265 | ) | 107,959 | ||||||||
Research and development
|
17,815 | 17,815 | ||||||||||
Selling, general and administrative
|
54,242 | 54,242 | ||||||||||
Acquisition costs
|
4,839 | (4,839 | ) | - | ||||||||
Total costs and expenses
|
187,120 | (7,104 | ) | 180,016 | ||||||||
Operating loss
|
(8,602 | ) | 7,830 | (772 | ) | |||||||
Interest income
|
98 | 98 | ||||||||||
Interest expense
|
(511 | ) | (511 | ) | ||||||||
Loss before income taxes
|
(9,015 | ) | 7,830 | (1,185 | ) | |||||||
Income tax benefit
|
(2,938 | ) | 2,167 | (771 | ) | |||||||
Net loss
|
$ | (6,077 | ) | $ | 5,663 | $ | (414 | ) | ||||
Basic loss per share
|
$ | (0.10 | ) | $ | 0.09 | $ | (0.01 | ) | ||||
Diluted loss per share
|
$ | (0.10 | ) | $ | 0.09 | $ | (0.01 | ) | ||||
Shares used in computing basic loss per share
|
60,367 | 60,367 | 60,367 | |||||||||
Shares used in computing diluted loss per share
|
60,367 | 60,367 | 60,367 | |||||||||
Three Months Ended March 28, 2010
|
||||||||||||
As Reported
|
Non-GAAP Adjustments
|
Non-GAAP As Adjusted
|
||||||||||
Total revenues
|
$ | 149,230 | $ | - | $ | 149,230 | ||||||
Costs and expenses:
|
||||||||||||
Cost of revenues
|
93,131 | 93,131 | ||||||||||
Research and development
|
15,543 | 15,543 | ||||||||||
Selling, general and administrative
|
43,426 | 43,426 | ||||||||||
Restructuring charges
|
737 | (737 | ) | - | ||||||||
Impairment of facility
|
2,421 | (2,421 | ) | - | ||||||||
Total costs and expenses
|
155,258 | (3,158 | ) | 152,100 | ||||||||
Operating loss
|
(6,028 | ) | 3,158 | (2,870 | ) | |||||||
Interest income
|
150 | 150 | ||||||||||
Interest expense
|
(345 | ) | (345 | ) | ||||||||
Loss before income taxes
|
(6,223 | ) | 3,158 | (3,065 | ) | |||||||
Income tax benefit
|
(2,578 | ) | 1,271 | (1,307 | ) | |||||||
Net loss
|
$ | (3,645 | ) | $ | 1,887 | $ | (1,758 | ) | ||||
Basic loss per share
|
$ | (0.06 | ) | $ | 0.03 | $ | (0.03 | ) | ||||
Diluted loss per share
|
$ | (0.06 | ) | $ | 0.03 | $ | (0.03 | ) | ||||
Shares used in computing basic loss per share
|
61,841 | 61,841 | 61,841 | |||||||||
Shares used in computing diluted loss per share
|
61,841 | 61,841 | 61,841 |
INTERMEC, INC. | ||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP GROSS MARGINS
|
||||||||||||
(In thousands, except per share amounts) | ||||||||||||
(Unaudited) | ||||||||||||
Three Months Ended April 3, 2011
|
||||||||||||
As Reported
|
Non-GAAP Adjustments
|
Non-GAAP As Adjusted
|
||||||||||
Revenues:
|
||||||||||||
Product
|
$ | 141,736 | $ | - | $ | 141,736 | ||||||
Service
|
36,782 | 726 | a | 37,508 | ||||||||
Total revenues
|
$ | 178,518 | $ | 726 | $ | 179,244 | ||||||
Cost of revenues:
|
||||||||||||
Product
|
$ | 86,964 | $ | (2,265 | ) b | $ | 84,699 | |||||
Service
|
23,260 | 23,260 | ||||||||||
Total cost of revenues
|
$ | 110,224 | $ | (2,265 | ) | $ | 107,959 | |||||
Gross margins:
|
||||||||||||
Product
|
38.6 | % | 40.2 | % | ||||||||
Service
|
36.8 | % | 38.0 | % | ||||||||
Total
|
38.3 | % | 39.8 | % | ||||||||
Three Months Ended March 28, 2010
|
||||||||||||
As Reported
|
Non-GAAP Adjustments
|
Non-GAAP As Adjusted
|
||||||||||
Revenues:
|
||||||||||||
Product
|
$ | 116,358 | $ | - | $ | 116,358 | ||||||
Service
|
32,872 | 32,872 | ||||||||||
Total revenues
|
$ | 149,230 | $ | - | $ | 149,230 | ||||||
Cost of revenues:
|
||||||||||||
Product
|
$ | 72,871 | $ | - | $ | 72,871 | ||||||
Service
|
20,260 | 20,260 | ||||||||||
Total revenues
|
$ | 93,131 | $ | - | $ | 93,131 | ||||||
Gross margins:
|
||||||||||||
Product
|
37.4 | % | 37.4 | % | ||||||||
Service
|
38.4 | % | 38.4 | % | ||||||||
Total revenues
|
37.6 | % | 37.6 | % |
RECONCILIATION OF GAAP TO NON-GAAP OUTLOOK
|
|||||||
FOR THE QUARTER ENDING JULY 3, 2011 | |||||||
(Unaudited)
|
|||||||
Diluted Earnings Per Share
|
|||||||
As reported
|
$ | (0.04) to 0.00 | |||||
Acquisition related costs
|
$ | 0.01 | |||||
Acquisition adjustments
|
$ | 0.06 | |||||
Restructuring
|
$ | 0.05 | |||||
As adjusted
|
$ | 0.08 to 0.12 |
INTERMEC, INC. | ||||||||
SUPPLEMENTAL INFORMATION: EBITDA AND ADJUSTED EBITDA CALCULATION
|
||||||||
(In thousands, except per share amounts) | ||||||||
(Unaudited)
|
||||||||
Three Months Ended
|
||||||||
April 3, 2011
|
March 28, 2010
|
|||||||
Operating loss, as reported
|
$ | (8,602 | ) | $ | (6,028 | ) | ||
Acquisition adjustments
|
||||||||
Acquisition fair-value adjustments
|
1,889 | - | ||||||
Intangible amortization
|
1,102 | - | ||||||
Acquisition costs
|
4,839 | - | ||||||
Restructuring charges
|
- | 737 | ||||||
Impairment of facility
|
- | 2,421 | ||||||
Total adjustments
|
7,830 | 3,158 | ||||||
Non-GAAP operating loss
|
$ | (772 | ) | $ | (2,870 | ) | ||
Adjusted EBITDA calculation
|
||||||||
Add: depreciation and amortization (excluding acquisition related)
|
$ | 3,805 | $ | 3,746 | ||||
|
||||||||
Add: stock-based compensation
|
2,328 | 1,905 | ||||||
Adjusted EBITDA
|
$ | 5,361 | $ | 2,781 |
INTERMEC, INC.
|
||||||||||||||||||||
SUPPLEMENTAL SALES INFORMATION BY CATEGORY
|
||||||||||||||||||||
(Amounts in millions) | ||||||||||||||||||||
(Unaudited)
|
Three Months Ended
|
||||||||||||||||||||
April 3, 2011
|
Percent of Revenues
|
March 28, 2010
|
Percent of Revenues
|
Percent Change in Revenues
|
||||||||||||||||
Revenues by category:
|
||||||||||||||||||||
Systems and solutions
|
$ | 98.3 | 55.1 | % | $ | 79.8 | 53.5 | % | 23.2 | % | ||||||||||
Printer and media
|
43.4 | 24.3 | % | 36.6 | 24.5 | % | 18.6 | % | ||||||||||||
Total product
|
141.7 | 79.4 | % | 116.4 | 78.0 | % | 21.7 | % | ||||||||||||
Service
|
36.8 | 20.6 | % | 32.8 | 22.0 | % | 12.2 | % | ||||||||||||
Total revenues
|
$ | 178.5 | 100.0 | % | $ | 149.2 | 100.0 | % | 19.6 | % | ||||||||||
SUPPLEMENTAL SALES INFORMATION BY GEOGRAPHICAL REGION
|
||||||||||||||||||||
(Amounts in millions) | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||
Three Months Ended
|
||||||||||||||||||||
April 3, 2011
|
Percent of Revenues
|
March 28, 2010
|
Percent of Revenues
|
Percent Change in Revenues
|
||||||||||||||||
Revenues by geographic region:
|
||||||||||||||||||||
North America
|
$ | 78.4 | 43.9 | % | $ | 74.5 | 49.9 | % | 5.2 | % | ||||||||||
Europe, Middle East and Africa (EMEA)
|
65.9 | 36.9 | % | 50.9 | 34.1 | % | 29.5 | % | ||||||||||||
All others
|
34.2 | 19.2 | % | 23.8 | 16.0 | % | 43.7 | % | ||||||||||||
Total revenues
|
$ | 178.5 | 100.0 | % | $ | 149.2 | 100.0 | % | 19.6 | % |
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