-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EQverPDlY1GBypVJ8IByQpAizxTRggmdFJnPiS7vdK+26p1DUc9iMbim1HLawD7J gvLDc8Imfxw+LI1uFxkGzg== 0001116502-03-000639.txt : 20030410 0001116502-03-000639.hdr.sgml : 20030410 20030410163800 ACCESSION NUMBER: 0001116502-03-000639 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030410 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030410 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RELM WIRELESS CORP CENTRAL INDEX KEY: 0000002186 STANDARD INDUSTRIAL CLASSIFICATION: RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT [3663] IRS NUMBER: 593486297 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-07336 FILM NUMBER: 03645855 BUSINESS ADDRESS: STREET 1: 7100 TECHNOLOGY DRIVE CITY: WEST MELBOURNE STATE: FL ZIP: 32904 BUSINESS PHONE: 321-984-1414 MAIL ADDRESS: STREET 1: 7100 TECHNOLOGY DRIVE CITY: WEST MELBOURNE STATE: FL ZIP: 32904 FORMER COMPANY: FORMER CONFORMED NAME: ADAGE INC DATE OF NAME CHANGE: 19920703 8-K 1 relm-8k.txt CURRENT REPORT UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 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) April 10, 2003 --------------- RELM Wireless Corporation ------------------------- (Exact name of registrant as specified in its charter) Nevada ------ (State or other jurisdiction of incorporation) 000-07336 59-34862971 --------- ----------- (Commission File Number) (IRS Employer Identification No.) 7100 Technology Drive, West Melbourne, FL 32904 ----------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (321) 984-1414 N/A --- (Former name or former address, if changed since last report) Item 7. Financial Statements and Exhibits (a) Financial statements of business acquired: None (b) Pro forma financial information: None (c) Exhibits Exhibit Number Description ------ ----------- 99.1 Press Release dated April 10, 2003 of RELM Wireless Corporation announcing its operating and financial results for the fourth quarter and year ended December 31, 2002. Item 9. Regulation FD Disclosure. On April 10, 2003, RELM Wireless Corporation issued a press release announcing its operating results for the fourth quarter and year ended December 31, 2002. The press release is attached as Exhibit 99.1 and incorporated by reference. The information furnished in this Item 9 (which is being furnished under Item 12) shall not be deemed "filed" for purposes of Section 18 of the Securities Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific release in such a filing. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. RELM WIRELESS CORPORATION (Registrant) By: /s/William P. Kelly ------------------------------------- William P. Kelly Dated: April 10, 2003 Executive Vice President - Finance and Chief Financial Officer EX-99.1 3 pressrelease991.txt PRESS RELEASE Exhibit 99.1 Press Release RELM WIRELESS ANNOUNCES FOURTH QUARTER AND YEAR-END FINANCIAL RESULTS WEST MELBOURNE, Fla, April 10, 2003 - RELM Wireless Corporation (NASDAQ: RELM) today announced its operating results for the fourth quarter and year ended December 31, 2002. Revenue for the fourth quarter of 2002 was $2.3 million, compared with $5.7 million for the same quarter last year. Fourth quarter net loss was $2.2 million, or ($0.26) per diluted share, compared with net income of $51,000, or $0.01 per diluted share, for the fourth quarter of the prior year. Net loss for the fourth quarter of 2002 includes non-recurring charges totaling approximately $0.7 million. Year-end 2002 revenue was $16.0 million compared with $22.8 million for the prior-year period. Net loss for the year 2002 was $3.6 million, or ($0.47) per diluted share, compared with net income of $0.1 million, or $0.02 per diluted share, for the prior-year period. Net loss for 2002 includes non-recurring charges totaling approximately $1.6 million. The results for the fourth quarter and the year ended December 31, 2002 were largely impacted by reduced sales of BK Radio-branded products to two of the Company's largest federal government customers. Additionally, customer demand in the business and industrial market segment was weak throughout 2002 compared to the prior year, reflecting the sustained challenging economic conditions. Responding to softening sales, the Company implemented key strategic initiatives in December 2002, including restructuring its sales and management organization and the hiring of a new executive sales management team. The new team brings to RELM a history of sales and marketing success with another large land mobile radio manufacturer and with other leading companies within the telecommunication industry. Additionally, the Company re-deployed other staff to focus entirely on critical new product introductions. For the year 2002, gross profit margins were 26.4% compared with 29.0% for the prior year. Due to lower volumes, unabsorbed manufacturing overhead costs were incurred as period expenses, adversely impacting cost of sales and gross profit margins. Accordingly, the Company reduced manufacturing staffing and related expenses during the fourth quarter. For the year 2002, selling, general, and administrative costs (SG&A) increased 9.3% to $6.5 million compared with $5.9 million for the same period last year. The increase is attributed primarily to expenses associated with new product development, and certain non-recurring charges. The Company's financial results for the fourth quarter and year-end 2002 include several non-recurring charges. These charges totaled approximately $1.6 million, of which $0.7 million were incurred during the fourth quarter. Allowances totaling approximately $1.1 million were established for two notes receivable from the purchasers of the assets of our former paper manufacturing and specialty-manufacturing subsidiaries. The businesses and events associated with these notes are legacies from before 1997 and are not at all related to land mobile radio operations. In addition to the notes, the remaining book value (approximately $300,000) of certain technology and investment banking agreements was written-off. Lastly, severance and other expenses (approximately $200,000) were incurred, associated with the restructuring of our sales and marketing organization. The Company's independent auditors have indicated in their report on our consolidated financial statements for the year ended December 31, 2002 that substantial doubt exists about the Company's ability to continue as a going concern because of the substantial net loss from operations for the year ended December 31, 2002 and because the Company is in default under the terms of its credit agreement. -MORE- Because of the default, under the terms of the credit agreement, the lender may demand immediate payment of all amounts owed. The lender has not made such a demand. If such a demand were made the Company would have to find alternative financing or severely curtail or cease operations. Based upon discussions with the lender, the Company anticipates entering into a forbearance agreement. The Company believes that this agreement will have a term of 90 days and will increase the current interest rate (prime rate plus 1.25%) by 2%. The agreement may be reviewed for renewal at the end of its term. The Company is seeking a replacement line of credit to fund its working capital demands. David P. Storey, President and Chief Executive Officer commented: "2002 proved to be an extremely challenging year, given lower revenues from our two largest customers, certain non-recurring charges, and industry-wide softness. Despite obstacles, we are aggressively addressing our challenges and have already implemented clearly defined initiatives for improvement in 2003 and we remain optimistic about our future prospects. "We made significant progress on new product development during the year, which resulted from the success of our public rights offering in the first quarter 2002. Our first digital product is complete and has been approved for use by the FCC. It is also in the process of being tested by the U. S. Department of Interior (DOI) for inclusion on their contract. The first four ESAS system installations are complete and set the stage for additional systems sales going forward. Late in the year we also introduced a new family of products, the RP Series, for business and industrial users. We believe that all these new products, and others that are in development, combined with our new sales and marketing team, will serve as a solid foundation on which to grow the business profitably." For over 55 years, RELM has manufactured and marketed two-way FM business-band radios as well as high-specification public safety mobile and portable radios, repeaters and accessories, base station components and subsystems. Products are manufactured and distributed worldwide under RELM Communications, Uniden PRC and BK Radio brand names. The company maintains its headquarters in West Melbourne, Florida and can be contacted through its web site at www.relm.com or directly at 1-800-648-0947. This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act Of 1995 and is subject to the safe-harbor created by such act. These forward-looking statements concern the Company's operations, economic performance and financial condition and are based largely on the Company's beliefs and expectations. These statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors and risks include, among others, the following: the factors described in the Company's filings with the Securities and Exchange Commission; general economic and business conditions; changes in customer preferences; competition; changes in technology; changes in business strategy; the indebtedness of the Company; quality of management, business abilities and judgment of the Company's personnel; and the availability, terms and deployment of capital. Certain of these factors and risks, as well as other risks and uncertainties are stated in more detail in the Company's Annual Report on Form 10-K. These forward-looking statements are made as of the date of this press release, and the Company assumes no obligation to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements. # # # (FINANCIAL TABLES TO FOLLOW) RELM WIRELESS CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (In Thousands, Except Per Share Data)
THREE MONTHS ENDED YEAR ENDED ---------------------- ---------------------- (Unaudited) 12/31/02 12/31/01 12/31/02 12/31/01 -------- -------- -------- -------- Sales 2,316 5,678 15,978 22,809 COSTS & EXPENSES: Cost Of Sales 2,150 3,978 11,760 16,190 SG&A 2,117 1,548 6,476 5,926 Loss On Notes Receivable 175 0 1,075 0 -------- -------- -------- -------- Total Costs & Exp 4,442 5,526 19,311 22,116 Operating Income (Loss) (2,126) 152 (3,333) 693 OTHER INCOME (EXPENSE): Interest expense (120) (127) (456) (579) Other Income (Expense) 22 26 158 8 -------- -------- -------- -------- Income (Loss) From Continuing Operations (2,224) 51 (3,631) 122 Tax Expense (Benefit) 0 0 0 0 -------- -------- -------- -------- Net Income (Loss) $ (2,224) $ 51 $ (3,631) $ 122 ======== ======== ======== ======== Earnings (Loss) per share - basic $ (0.26) $ 0.01 $ (0.47) $ 0.02 ================================================== Earnings (Loss) per share - diluted $ (0.26) $ 0.01 $ (0.47) $ 0.02 ================================================== Weighted Average Common Shares Outstanding, Basic 8,540 5,346 7,787 5,346 Weighted Average Common Shares Outstanding, Diluted 8,540 5,404 7,787 5,383
Contact: Porter, Le Vay & Rose, Inc. Linda Decker or Catherine Hay 212-564-4700 or RELM Wireless Corporation William P. Kelly, 321/984-1414 -----END PRIVACY-ENHANCED MESSAGE-----