EX-99.1 2 a05-19137_1ex99d1.htm EXHIBIT 99

Exhibit 99.1

 

NEWS

 

For Release October 27, 2005 at 1:05 p.m. PST:

 

WJ Communications Announces Third Quarter Results

 

October 27, 2005 - San Jose, CA - WJ Communications, Inc. (NASDAQ: WJCI), a leading designer and supplier of RF solutions for the wireless infrastructure and RFID reader markets, today announced results for its third quarter ended October 2, 2005.

 

Revenue for the third quarter of 2005 was $8.1 million, above the previously given third quarter guidance range of $7.6 to $8.0 million.  Revenue for the third quarter was derived primarily from the Company’s core business consisting of semiconductor components, multi-chip modules and RFID reader modules.  This compares to revenue of $8.9 million in the same period last year, consisting of $8.4 million from the core business and $0.5 million from the legacy wireless assembly business.

 

The Company reported a net loss of $3.4 million for the third quarter of 2005 or $0.05 per common share.  This includes a charge of $0.4 million related to employee separation and a $0.1 million dollar benefit related to the revision of our estimated tax liability.  This compares to net income of $1.2 million or $0.02 per common share in the year ago period which included a benefit of $3.4 million from the reversal of a remaining restructuring accrual and a tax benefit of $1.1 million from a revision of the estimated tax liability related to previous years’ audits.

 

As of October 2, 2005, the Company had cash, cash equivalents and short-term investments of $32.8 million with no long-term debt outstanding.

 

“We were pleased with our third quarter revenue performance which was above our previously stated guidance,” said Bruce Diamond, the new Chief Executive Officer and President of WJ Communications.  “We saw sequential improvements in our wireless infrastructure business with strength coming from our

 

 

401 River Oaks Parkway, San Jose, CA 95134     Phone:  800-WJ1-4401     Fax:  408-577-6621

 


 

 

overseas markets particularly in Korea.  We have focused our RFID efforts on partnering with leading systems integrators which we believe positions us well to capitalize on future growth in this market.”

 

“Our third quarter gross margins of 53% were higher than expected due to product mix and higher than expected sales,” added Rainer Growitz, Interim Chief Financial Officer of WJ Communications. “Looking forward, we see growth in our business and expect sequential revenue increases from both wireless infrastructure and RFID.  These factors lead us to give a revenue guidance range at this time of $8.5 million to $8.9 million for the fourth quarter of 2005.”

 

About WJ Communications

 

WJ Communications, Inc. is a leading provider of radio frequency (RF) solutions serving multiple markets targeting wireless communications, RF identification (RFID), broadband cable, and defense and homeland security. WJ addresses the RF challenges in these multiple markets with its highly reliable amplifiers, mixers, RF integrated circuits (RFICs), RFID reader modules, chipsets, and multi-chip (MCM) modules. For more information visit www.wj.com or call 408-577-6200.

 

This release contains forward-looking statements including financial projections, statements as to the plans and objectives of management for future operations, and statements as to the Company’s future economic performance, financial condition or results of operations. These forward-looking statements are not historical facts but rather are based on current expectations and our beliefs. Words such as “may,” “will,” “expects,” “intends,” “plans,” “believes,” “seeks” “could” and “estimates” and variations of these words and similar expressions are intended to identify forward-looking statements. The Company’s actual results may differ materially from those projected in these forward-looking statements as a result of a number of factors, including, but not limited to, the actual success of deploying 3G in 2005, the actual future success in building relationships with major OEMs from RFID business in 2005, our actual future performance in wireless infrastructure for 2005, actual revenue performance in the fourth quarter of 2005, the risk factors contained in the Company’s Form 10-K for year ended 2004 and such other factors as described from time to time in the Company’s filings with the Securities & Exchange Commission which are available on the SEC website at www.sec.gov.  Readers of this release are cautioned not to place undue reliance on these forward-looking statements. The Company undertakes no obligation to publicly update or revise the forward-looking statements contained herein to reflect changed events or circumstances after the date of this press release.

 

 

# # #

 

 

WJ Communications:

 

 

Investor Relations Contacts:

 

 

 

 

Rainer Growitz

or

 

Chris Danne, Rakesh Mehta

Interim Chief Financial Officer

 

 

The Blueshirt Group for WJ Communications

408-577-6200

 

 

415-217-7722

www.wj.com

 

 

chris@blueshirtgroup.com

 

 

 

rakesh@blueshirtgroup.com

 

 

 


 

WJ Communications Inc. and Subsidiaries

Unaudited Consolidated Statements of Operations

(in thousands, except per share amounts)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

October 2,
2005

 

September 26,
2004

 

October 2,
2005

 

September 26,
2004

 

 

 

 

 

 

 

 

 

 

 

Sales

 

 

 

 

 

 

 

 

 

Core business (1)

 

$

8,044

 

$

8,379

 

$

19,548

 

$

22,122

 

Legacy (2)

 

50

 

550

 

343

 

2,293

 

Total sales

 

8,094

 

8,929

 

19,891

 

24,415

 

 

 

 

 

 

 

 

 

 

 

Cost of goods sold

 

3,774

 

4,536

 

10,992

 

11,039

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

4,320

 

4,393

 

8,899

 

13,376

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research & development

 

4,451

 

4,354

 

13,591

 

12,588

 

 

 

 

 

 

 

 

 

 

 

Selling & administrative

 

3,632

 

3,523

 

11,644

 

9,326

 

 

 

 

 

 

 

 

 

 

 

Acquired in-process research & development

 

—

 

—

 

3,400

 

8,500

 

 

 

 

 

 

 

 

 

 

 

Restructuring reversals

 

—

 

(3,416

)

—

 

(3,845

)

 

 

 

 

 

 

 

 

 

 

Total operating expenses

 

8,083

 

4,461

 

28,635

 

26,569

 

 

 

 

 

 

 

 

 

 

 

Loss from operations

 

(3,763

)

(68

)

(19,736

)

(13,193

)

 

 

 

 

 

 

 

 

 

 

Interest income, net

 

243

 

147

 

696

 

414

 

 

 

 

 

 

 

 

 

 

 

Other income, net

 

3

 

—

 

11

 

—

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

(3,517

)

79

 

(19,029

)

(12,779

)

 

 

 

 

 

 

 

 

 

 

Income tax benefit

 

(123

)

(1,133

)

(123

)

(7,674

)

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

(3,394

)

$

1,212

 

$

(18,906

)

$

(5,105

)

 

 

 

 

 

 

 

 

 

 

Basic net income (loss) per share

 

$

(0.05

)

$

0.02

 

$

(0.30

)

$

(0.08

)

 

 

 

 

 

 

 

 

 

 

Diluted net income (loss) per share

 

$

(0.05

)

$

0.02

 

$

(0.30

)

$

(0.08

)

 

 

 

 

 

 

 

 

 

 

Basic weighted average shares

 

64,516

 

60,908

 

63,860

 

60,195

 

 

 

 

 

 

 

 

 

 

 

Diluted weighted average shares

 

64,516

 

65,913

 

63,860

 

60,195

 

(1)                      Core business sales includes sales of our semiconductor components, multi-chip modules and RFID reader modules.

(2)                      Legacy sales includes sales of our wireless and fiber optic products.

 

 


 

 

WJ Communications Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(in thousands)

 

 

 

October 2,
2005 (1)

 

December 31,
2004 (2)

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

19,623

 

$

24,392

 

 

 

 

 

 

 

Short-term investments

 

13,176

 

18,732

 

 

 

 

 

 

 

Accounts receivable, net

 

5,494

 

6,841

 

 

 

 

 

 

 

Inventory

 

5,260

 

5,148

 

 

 

 

 

 

 

Other current assets

 

2,128

 

3,183

 

 

 

 

 

 

 

Total current assets

 

45,681

 

58,296

 

 

 

 

 

 

 

Property, plant and equipment

 

7,668

 

9,679

 

 

 

 

 

 

 

Goodwill

 

6,881

 

1,368

 

 

 

 

 

 

 

Intangible assets, net

 

1,974

 

180

 

 

 

 

 

 

 

Other assets

 

210

 

210

 

 

 

 

 

 

 

Total assets

 

$

62,414

 

$

69,733

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

Current liabilities

 

$

15,227

 

$

11,572

 

 

 

 

 

 

 

Long-term obligations

 

14,860

 

16,864

 

 

 

 

 

 

 

Stockholders’ equity

 

32,327

 

41,297

 

 

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

62,414

 

$

69,733

 

(1)                      Unaudited

 

(2)                      Derived from the Company’s audited consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2004.