0001193125-15-364506.txt : 20151103 0001193125-15-364506.hdr.sgml : 20151103 20151103172130 ACCESSION NUMBER: 0001193125-15-364506 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20151103 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20151103 DATE AS OF CHANGE: 20151103 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PC TEL INC CENTRAL INDEX KEY: 0001057083 STANDARD INDUSTRIAL CLASSIFICATION: RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT [3663] IRS NUMBER: 770364943 STATE OF INCORPORATION: DE FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-27115 FILM NUMBER: 151194656 BUSINESS ADDRESS: STREET 1: 471 BRIGHTON DRIVE CITY: BLOOMINGDALE STATE: IL ZIP: 60108 BUSINESS PHONE: 630-372-6800 MAIL ADDRESS: STREET 1: 471 BRIGHTON DRIVE CITY: BLOOMINGDALE STATE: IL ZIP: 60108 8-K 1 d24083d8k.htm FORM 8-K Form 8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (date of earliest event reported)

November 3, 2015

 

 

PCTEL, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   000-27115   77-0364943

(State or Other Jurisdiction

of Incorporation)

  

(Commission

File Number)

   (IRS Employer
Identification No.)

471 Brighton Drive

Bloomingdale, Illinois 60108

(Address of Principal Executive Offices, including Zip Code)

(630) 372-6800

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12(b))

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

Item 2.02 Results of Operations and Financial Condition

The following information is intended to be furnished under Item 2.02 of Form 8-K, “Results of Operations and Financial Condition.” This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

On November 3, 2015, PCTEL, Inc. issued a press release regarding its financial results for its third fiscal quarter ended September 30, 2015. The full text of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

 

Item 9.01 Financial Statements and Exhibits

 

(d) Exhibits.

 

99.1    Press release, dated November 3, 2015, of PCTEL, Inc. announcing its financial results for its third fiscal quarter ended September 30, 2015.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: November 3, 2015

 

  PCTEL, INC.
By:  

/s/ John W. Schoen

  John W. Schoen, Chief Financial Officer

EXHIBIT INDEX

 

Exhibit

Number

   

Description

Exhibit 99.1    Press release, dated November 3, 2015, of PCTEL, Inc. announcing its financial results for its third fiscal quarter ended September 30, 2015.
 EX-99.1 2 d24083dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

PCTEL Achieves $26.5 Million in Third Quarter Revenue

BLOOMINGDALE, IL. – November 3, 2015 — PCTEL, Inc. (NASDAQ:PCTI), a leader in Performance Critical Telecom solutions, announced its 2015 third quarter results.

Quarter Highlights

$26.5 million in revenue for the quarter, a decrease of five percent from the same period last year.

Gross profit margin of 33 percent in the quarter, compared to 41 percent for the same period last year.

GAAP operating margin of negative eight percent for the quarter, compared to operating margin of eight percent for the same period last year.

GAAP net loss of $(1.1) million for the quarter, or $(0.06) per diluted share, compared to net income of $2.2 million, or $0.12 per diluted share for the same period last year.

Non-GAAP operating profit and net income are measures the company uses to reflect the results of its core earnings. The Company’s reporting of non-GAAP net income excludes expenses for restructuring, gain or loss on sale of assets, stock based compensation, amortization and impairment of intangible assets and goodwill related to the Company’s acquisitions, and non-cash related income tax expense.

Non-GAAP operating margin of half a percent in the quarter, compared to 12 percent in the same period last year.

Non-GAAP net income of $108,000 or $0.01 per diluted share in the quarter, compared to $2.9 million or $0.16 per diluted share in the same period last year.

$34.3 million of cash and short-term investments at September 30, 2015, a decrease of approximately $6.9 million from the preceding quarter. Free cash flow in the quarter was $461,000, comprised of $747,000 in cash flow from operations and $286,000 of capital spending. During the quarter the Company repurchased 1,114,000 shares of its common stock for approximately $6.9 million, and paid a regular quarterly dividend of $911,000.

“We made progress in our antenna and scanning receiver equipment business,” said Marty Singer, PCTEL’s Chairman and CEO. “At the same time our engineering services operations continue to weather the downturn in carrier spending and we are investing resources into our data analytics software product line. We expect our engineering services to expand with renewed spending during the fourth quarter and our data analytics investment to generate revenue in 2016,” added Singer.

CONFERENCE CALL / WEBCAST

PCTEL’s management team will discuss the Company’s results today at 5:15 PM ET. The call can be accessed by dialing (877) 734-5369 (U.S. / Canada) or (706) 679-6397 (International), conference ID: 13775112. The call will also be webcast at http://investor.pctel.com/events.cfm.

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: 13775112.

About PCTEL

PCTEL, a global provider of RF expertise, delivers Performance Critical Telecom solutions to the wireless industry. PCTEL benchmarks and optimizes wireless networks with its data tools, engineering services, and RF products. PCTEL’s antennas and site solutions are vital elements for networks serving SCADA, fleet management, health care, public safety, and education.

PCTEL’s RF Solutions products and services improve the performance of wireless networks globally. PCTEL’s performance critical products include its MXflex®, IBflex®, and EXflex® SeeGull® scanning receivers and related SeeHawk® Touch, SeeHawk® Collect, and SeeWave™ tools. PCTEL’s sophisticated engineering services utilize these products as well as the SeeHawk™ Analytics portfolio (Network Analytics, Subscriber Analytics, Map Analytics, and Business Intelligence).

PCTEL Connected Solutions designs and delivers performance critical antennas and site solutions for public and private wireless networks globally. PCTEL’s performance critical antenna solutions include high rejection and high performance GPS and GNSS products, the industry leading Yagi portfolio, mobile and indoor LTE, broadband, and LMR antennas and PIM-rated antennas for transit, in-building, and small cell applications. We leverage our design, logistics, and support capabilities to deliver performance critical antenna and site solutions into carrier, railroad, utility applications, oil and gas, and other vertical markets.

PCTEL’s products are sold worldwide through direct and indirect channels. For more information, please visit the company’s web sites: www.pctel.com, www.antenna.com, or www.rfsolutions.pctel.com

PCTEL Safe Harbor Statement

This press release and our related comments in our third quarter 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, new products and features, expectations regarding the future growth of our antenna and wireless RF businesses, and demand for engineering services 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 customer demand for these types of products and services generally, PCTEL’s ability to successfully grow the wireless products business, and its ability to implement new technologies and obtain protection for the related intellectual property. 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.

# # #

For further information contact:

 

John Schoen   Jack Seller
CFO   Public Relations
PCTEL, Inc.   PCTEL, Inc.
(630) 372-6800   (630)372-6800
  Jack.seller@pctel.com

PCTEL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

 

     (unaudited)        
     September 30,     December 31,  
     2015     2014  
ASSETS     

Cash and cash equivalents

    $ 12,887      $ 20,432   

Short-term investment securities

      21,428        39,577   

Accounts receivable, net of allowance for doubtful accounts of $119 and $121 at September 30, 2015 and December 31, 2014, respectively

      20,643        23,874   

Inventories, net

      17,187        16,358   

Deferred tax assets, net

      2,279        2,281   

Prepaid expenses and other assets

      2,440        1,757   
  

 

 

    

 

 

  

Total current assets

      76,864        104,279   

Property and equipment, net

      14,042        14,842   

Goodwill

      3,493        161   

Intangible assets, net

      12,434        2,637   

Deferred tax assets, net

      10,348        9,710   

Other noncurrent assets

      36        40   
  

 

 

    

 

 

  

TOTAL ASSETS

    $ 117,217      $ 131,669   
  

 

 

    

 

 

  
LIABILITIES AND STOCKHOLDERS’ EQUITY     

Accounts payable

    $ 5,631      $ 5,495   

Accrued liabilities

      6,430        10,211   
  

 

 

    

 

 

  

Total current liabilities

      12,061        15,706   

Other long-term liabilities

      930        448   
  

 

 

    

 

 

  

Total liabilities

      12,991        16,154   
  

 

 

    

 

 

  

Stockholders’ equity:

     

Common stock, $0.001 par value, 100,000,000 shares authorized, 17,815,573 and 18,571,419 shares issued and outstanding at September 30, 2015 and December 31, 2014, respectively

      18        19   

Additional paid-in capital

      137,768        145,462   

Accumulated deficit

      (33,619 )      (30,101 ) 

Accumulated other comprehensive income

      59        135   
  

 

 

    

 

 

  

Total stockholders’ equity

      104,226        115,515   
  

 

 

    

 

 

  

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

    $ 117,217      $ 131,669   
  

 

 

    

 

 

  

PCTEL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(in thousands, except per share data)

 

     Three Months Ended      Nine Months Ended  
     September 30,      September 30,  
     2015     2014      2015     2014  

REVENUES

    $ 26,526      $ 27,932       $ 80,477      $ 77,769   

COST OF REVENUES

      17,896        16,538         52,067        45,943   
  

 

 

    

 

 

     

 

 

    

 

 

  

GROSS PROFIT

      8,630        11,394         28,410        31,826   
  

 

 

    

 

 

     

 

 

    

 

 

  

OPERATING EXPENSES:

          

Research and development

      2,863        2,659         8,506        8,970   

Sales and marketing

      3,603        3,054         10,558        9,312   

General and administrative

      2,847        3,120         9,513        9,822   

Amortization of intangible assets

      1,125        465         2,963        1,503   

Restructuring charges

      413        0         852        0   
  

 

 

    

 

 

     

 

 

    

 

 

  

Total operating expenses

      10,851        9,298         32,392        29,607   
  

 

 

    

 

 

     

 

 

    

 

 

  

OPERATING INCOME (LOSS)

      (2,221 )      2,096         (3,982 )      2,219   

Other income, net

      534        207         2,783        738   
  

 

 

    

 

 

     

 

 

    

 

 

  

INCOME (LOSS) BEFORE INCOME TAXES

      (1,687 )      2,303         (1,199 )      2,957   

Expense (benefit) for income taxes

      (625 )      85         (451 )      340   
  

 

 

    

 

 

     

 

 

    

 

 

  

NET INCOME (LOSS)

    ($ 1,062 )    $ 2,218       ($ 748 )    $ 2,617   
  

 

 

    

 

 

     

 

 

    

 

 

  

Net Income (Loss) per Share:

          

Basic

    ($ 0.06 )    $ 0.12       ($ 0.04 )    $ 0.14   

Diluted

    ($ 0.06 )    $ 0.12       ($ 0.04 )    $ 0.14   

Weighed Average Shares:

          

Basic

      17,626        18,112         18,059        18,155   

Diluted

      17,626        18,271         18,059        18,346   

Cash dividend per share

    $ 0.05      $ 0.04       $ 0.15      $ 0.12   

PCTEL, INC.

P&L INFORMATION BY SEGMENT (unaudited)

(in thousands)

 

     Three Months Ended September 30, 2015     Nine Months Ended September 30, 2015  
     Connected
Solutions		      RF
Solutions		     Corporate     Total     Connected
Solutions		      RF
Solutions		     Corporate     Total  

REVENUES

    $ 17,450       $ 9,115      ($ 39 )    $ 26,526      $ 52,903       $ 27,749      ($ 175 )    $ 80,477   
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  

GROSS PROFIT

      4,729         3,894        7        8,630        15,588         12,802        20        28,410   
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  

OPERATING INCOME (LOSS)

    $ 1,160       ($ 1,058 )    ($ 2,323 )    ($ 2,221 )    $ 4,255       ($ 181 )    ($ 8,056 )    ($ 3,982 ) 
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  
     Three Months Ended September 30, 2014     Nine Months Ended September 30, 2014  
     Connected
Solutions		      RF
Solutions		     Corporate     Total     Connected
Solutions		      RF
Solutions		     Corporate     Total  

REVENUES

    $ 18,697       $ 9,283      ($ 48 )    $ 27,932      $ 52,409       $ 25,578      ($ 218 )    $ 77,769   
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  

GROSS PROFIT

      5,803         5,584        7        11,394        16,635         15,171        20        31,826   
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  

OPERATING INCOME (LOSS)

    $ 2,262       $ 2,492      ($ 2,658 )    $ 2,096      $ 5,278       $ 5,150      ($ 8,209 )    $ 2,219   
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  

Reconciliation of GAAP to non-GAAP Results (unaudited)

(in thousands except per share information)

Reconciliation of GAAP operating loss to non-GAAP operating income (a)

 

     Three Months Ended September 30,     Nine Months Ended September 30,  
     2015     2014     2015     2014  

Operating Income (Loss)

    ($ 2,221 )    $ 2,096      ($ 3,982 )    $ 2,219   

(a)    Add:

         

Amortization of intangible assets

      1,125        465        2,963        1,503   

Restructuring:

         

-Cost of Goods Sold

      132        0        246        0   

-Restructuring

      413        0        852        0   

TelWorx investigation:

         

-General & Administrative

      9        188        100        686   

Legal settlement:

         

-General & Administrative

      0        0        0        75   

Stock Compensation:

         

-Cost of Goods Sold

      115        112        244        315   

-Engineering

      99        149        244        509   

-Sales & Marketing

      230        155        370        491   

-General & Administrative

      206        315        534        1,263   
  

 

 

    

 

 

    

 

 

    

 

 

  
     2,329        1,384        5,553        4,842   
  

 

 

    

 

 

    

 

 

    

 

 

  

Non-GAAP Operating Income

    $ 108      $ 3,480      $ 1,571      $ 7,061   
  

 

 

    

 

 

    

 

 

    

 

 

  

% of revenue

      0.4 %      12.5 %      2.0 %      9.1 % 

Reconciliation of GAAP net loss to non-GAAP net income (b)

 

     Three Months Ended September 30,     Nine Months Ended September 30,  
     2015     2014     2015     2014  

Net Income (Loss)

    ($ 1,062 )    $ 2,218      ($ 748 )    $ 2,617   

Adjustments:

         

(a)    Non-GAAP adjustment to operating income

      2,329        1,384        5,553        4,842   

(b)    Other income related to SEC investigation of TelWorx

      (10 )      (188 )      (99 )      (660 ) 

(b)    Legal Settlement - Amendment to Nexgen APA

      (500 )      0        (2,660 )      0   

(b)    Legal Settlement - other

      0        0        0        (75 ) 

(b)    Income Taxes

      (649 )      (545 )      (738 )      (932 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  
     1,170        651        2,056        3,175   
  

 

 

    

 

 

    

 

 

    

 

 

  

Non-GAAP Net Income

    $ 108      $ 2,869      $ 1,308      $ 5,792   
  

 

 

    

 

 

    

 

 

    

 

 

  

Non-GAAP Earning per Share:

         

Basic

    $ 0.01      $ 0.16      $ 0.07      $ 0.32   

Diluted

    $ 0.01      $ 0.16      $ 0.07      $ 0.32   

Weighed Average Shares:

         

Basic

      17,626        18,112        18,059        18,155   

Diluted

      17,809        18,271        18,428        18,346   

This schedule reconciles the Company’s GAAP operating loss and GAAP net loss to its non-GAAP operating income and non-GAAP net 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.

 

(a) These adjustments reflect stock based compensation expense, amortization of intangible assets, restructuring charges, and general and administrative expenses associated with the SEC investigation of TelWorx.
(b) These adjustments include the items described in footnote (a) as well as other income for insurance claims related to the SEC investigation of TelWorx, legal settlements, and non-cash income tax expense.

Reconciliation of GAAP To non-GAAP SEGMENT INFORMATION (unaudited) (a)

(in thousands except per share information)

 

     Three Months Ended September 30, 2015     Nine Months Ended September 30, 2015  
     Connected
Solutions		     RF
Solutions		     Corporate     Total     Connected
Solutions		      RF
Solutions		     Corporate     Total  

Operating Income (Loss)

    $ 1,160      ($ 1,058 )    ($ 2,323 )    ($ 2,221 )    $ 4,255       ($ 181 )    ($ 8,056 )    ($ 3,982 ) 

Add:

                  

Amortization of intangible assets

      195        930        0        1,125        655         2,308        0        2,963   

TelWorx investigation:

                  

-General & Administrative

      0        0        9        9        0         0        100        100   

Restructuring:

                  

-Cost of Goods Sold

      132        0        0        132        246         0        0        246   

-Restructuring charges

      113        300        0        413        538         314        0        852   

Stock Compensation:

                  

-Cost of Goods Sold

      40        75        0        115        54         190        0        244   

-Engineering

      (5 )      104        0        99        55         189        0        244   

-Sales & Marketing

      88        142        0        230        173         197        0        370   

-General & Administrative

      16        44        146        206        6         43        485        534   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  
     579        1,595        155        2,329        1,727         3,241        585        5,553   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  

Non-GAAP Operating Income (Loss)

    $ 1,739      $ 537      ($ 2,168 )    $ 108      $ 5,982       $ 3,060      ($ 7,471 )    $ 1,571   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  
     Three Months Ended September 30, 2014     Nine Months Ended September 30, 2014  
     Connected
Solutions		     RF
Solutions		     Corporate     Total     Connected
Solutions		      RF
Solutions		     Corporate     Total  

Operating Income (Loss)

    $ 2,262      $ 2,492      ($ 2,658 )    $ 2,096      $ 5,278       $ 5,150      ($ 8,209 )      2,219   

Add:

                  

Amortization of intangible assets

      261        204        0        465        891         612        0        1,503   

TelWorx investigation:

                  

-General & Administrative

      0        0        188        188        0         0        686        686   

Legal settlement:

                  

-General & Administrative

      0        0        0        0        0         0        75        75   

Stock Compensation:

                  

-Cost of Goods Sold

      58        54        0        112        157         158        0        315   

-Engineering

      63        86        0        149        229         280        0        509   

-Sales & Marketing

      122        33        0        155        401         90        0        491   

-General & Administrative

      54        31        230        315        202         98        963        1,263   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  
     558        408        418        1,384        1,880         1,238        1,724        4,842   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  

Non-GAAP Operating Income (Loss)

    $ 2,820      $ 2,900      ($ 2,240 )    $ 3,480      $ 7,158       $ 6,388      ($ 6,485 )    $ 7,061   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

    

 

 

    

 

 

  

This schedule reconciles the Company’s GAAP operating income (loss) by segment to its non-GAAP operating 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.

 

(a) These adjustments reflect stock based compensation expense, amortization of intangible assets, restructuring charges, and general and administrative expenses associated with the SEC investigation of TelWorx.
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