-----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, TwKjUXZAlcuOy1xtIcU41jKDJ/nTRsEWMgTzmhiIuyTUuWGri6qNb0LiZGYtYumh 4evEgpMfmvnmYfYddUROTg== 0000912057-99-005654.txt : 19991117 0000912057-99-005654.hdr.sgml : 19991117 ACCESSION NUMBER: 0000912057-99-005654 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19991002 FILED AS OF DATE: 19991115 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ZEBRA TECHNOLOGIES CORP/DE CENTRAL INDEX KEY: 0000877212 STANDARD INDUSTRIAL CLASSIFICATION: GENERAL INDUSTRIAL MACHINERY & EQUIPMENT [3560] IRS NUMBER: 366966580 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-19406 FILM NUMBER: 99752021 BUSINESS ADDRESS: STREET 1: 333 CORPORATE WOODS PKWY CITY: VERNON HILLS STATE: IL ZIP: 60061 BUSINESS PHONE: 7086346700 10-Q 1 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM 10-Q [ X ] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended October 2, 1999 Commission File Number: 000-19406 Zebra Technologies Corporation ------------------------------ (Exact name of registrant as specified in its charter) Delaware 36-2675536 - ------------------------------- ------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 333 Corporate Woods Parkway, Vernon Hills, IL 60061 ---------------------------------------------------- (Address of principal executive offices) (Zip Code) (847) 634-6700 -------------- (Registrant's telephone number, including area code) Indicate by check mark whether the registrant has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and has been subject to such filing requirements for the past 90 days. [ X ] Yes [ ] No As of November 10, 1999, there were the following shares outstanding: Class A Common Stock, $.01 par value 24,467,604 Class B Common Stock, $.01 par value 6,871,716 ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES QUARTER ENDED OCTOBER 2, 1999 INDEX PAGE ---- PART I - FINANCIAL INFORMATION Item 1. Consolidated Financial Statements Independent Auditors' Review Report 3 Consolidated Balance Sheets as of October 2, 1999 (unaudited) and December 31, 1998 4 Consolidated Statements of Earnings (unaudited) for the three months and nine months ended October 2, 1999 and October 3, 1998 5 Consolidated Statements of Comprehensive Income (unaudited) for the three months and nine months ended October 2, 1999 and October 3, 1998 6 Consolidated Statements of Cash Flows (unaudited) for the nine months ended October 2, 1999 and October 3, 1998 7 Notes to Consolidated Financial Statements 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 Item 3. Quantitative and Qualitative Disclosures About Market Risk 13 PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K 14 SIGNATURES 15 2 PART I - FINANCIAL INFORMATION ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS INDEPENDENT AUDITORS' REVIEW REPORT The Board of Directors and Shareholders Zebra Technologies Corporation: We have reviewed the consolidated balance sheet of Zebra Technologies Corporation and subsidiaries (the Company) as of October 2, 1999, and the related consolidated statements of earnings and comprehensive income for the three-month and nine-month periods ended October 2, 1999, and October 3, 1998, and the related statements of cash flows for the nine-month periods ended October 2, 1999, and October 3, 1998. These consolidated financial statements are the responsibility of the Company's management. We conducted our reviews in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our reviews, we are not aware of any material modifications that should be made to the accompanying consolidated financial statements for them to be in conformity with generally accepted accounting principles. We have previously audited, in accordance with generally accepted auditing standards, the consolidated balance sheet of Zebra Technologies Corporation and subsidiaries as of December 31, 1998, and the related consolidated statements of earnings, comprehensive income, shareholders' equity, and cash flows for the year then ended (not presented herein); and in our report dated February 24, 1999, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of December 31, 1998 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived. /s/KPMG LLP Chicago, Illinois October 27, 1999 3 ZEBRA TECHNOLOGIES CORPORATION CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except share and per share data)
OCTOBER 2, DECEMBER 31, 1999 1998 -------------- ----------------- ASSETS (Unaudited) Current assets: Cash and cash equivalents $ 19,767 $ 11,391 Investments and marketable securities 196,335 151,277 Accounts receivable, net 70,836 57,654 Inventories 36,057 39,684 Deferred income taxes 5,842 5,137 Prepaid expenses 2,806 1,328 -------------- ----------------- Total current assets 331,643 266,471 -------------- ----------------- Property and equipment at cost, less accumulated depreciation and amortization 39,560 38,850 Other assets 4,477 4,681 -------------- ----------------- TOTAL ASSETS $ 375,680 $ 310,002 ============== ================= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 25,646 $ 20,565 Accrued liabilities 11,686 11,498 Short-term note payable 185 183 Current portion of obligation under capital lease 16 51 Income taxes payable 7,592 4,486 -------------- ----------------- Total current liabilities 45,125 36,783 -------------- ----------------- Obligation under capital lease with related party, less current portion 42 - Long-term liability 16 36 Deferred income taxes 2,649 1,932 Other 133 367 -------------- ----------------- TOTAL LIABILITIES 47,965 39,118 -------------- ----------------- Shareholders' equity: Preferred Stock, $.01 par value; 10,000,000 shares authorized, none outstanding - - Class A Common Stock, $.01 par value; 50,000,000 shares authorized, 24,362,445 and 22,323,094 shares issued and outstanding in 1999 and 1998, respectively 244 223 Class B Common Stock, $.01 par value; 28,358,189 shares authorized, 6,953,401 and 8,619,919 shares issued and outstanding in 1999 and 1998, respectively 70 86 Additional paid-in capital 57,597 49,854 Retained earnings 269,476 219,772 Accumulated other comprehensive income 328 949 -------------- ----------------- -------------- ----------------- TOTAL SHAREHOLDERS' EQUITY 327,715 270,884 -------------- ----------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 375,680 $ 310,002 ============== =================
See accompanying notes to consolidated financial statements. 4 ZEBRA TECHNOLOGIES CORPORATION CONSOLIDATED STATEMENTS OF EARNINGS (Amounts in thousands, except per share data) (Unaudited)
THREE MONTHS ENDED NINE MONTHS ENDED ------------------------------ ------------------------------ OCTOBER 2, OCTOBER 3, OCTOBER 2, OCTOBER 3, 1999 1998 1999 1998 -------------- --------------- -------------- --------------- Net sales $ 103,988 $ 88,068 $ 291,131 $ 255,906 Cost of sales 48,139 45,687 144,607 132,963 -------------- --------------- -------------- --------------- Gross profit 55,849 42,381 146,524 122,943 Operating expenses: Selling and marketing 9,937 9,028 29,679 26,441 Research and development 5,219 5,437 16,225 15,972 General and administrative 7,721 6,544 23,005 19,812 Merger-related costs 1,581 -- 4,741 -- -------------- --------------- -------------- --------------- Total operating expenses 24,458 21,009 73,650 62,225 -------------- --------------- -------------- --------------- Operating income 31,391 21,372 72,874 60,718 -------------- --------------- -------------- --------------- Other income (expense): Investment income (expense) 1,389 (401) 6,595 3,215 Interest income (expense) (3) 6 (19) (402) Other, net (1,721) (240) (1,386) 42 -------------- --------------- -------------- --------------- Total other income (expense) (335) (635) 5,190 2,855 -------------- --------------- -------------- --------------- Income before income taxes 31,056 20,737 78,064 63,573 Income taxes 11,124 7,524 28,360 23,160 -------------- --------------- -------------- --------------- Net income $ 19,932 $ 13,213 $ 49,704 $ 40,413 ============== =============== ============== =============== Basic earnings per share $ 0.64 $ 0.43 $ 1.60 $ 1.30 Diluted earnings per share $ 0.63 $ 0.42 $ 1.58 $ 1.30 Basic weighted average shares outstanding 31,247 30,894 31,109 30,921 Diluted weighted average and equivalent shares outstanding 31,648 31,137 31,401 31,189
See accompanying notes to consolidated financial statements. 5 ZEBRA TECHNOLOGIES CORPORATION CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Amounts in thousands) (Unaudited)
THREE MONTHS ENDED NINE MONTHS ENDED ------------------------------ ------------------------------ OCTOBER 2, OCTOBER 3, OCTOBER 2, OCTOBER 3, 1999 1998 1999 1998 -------------- --------------- -------------- --------------- Net income $ 19,932 $ 13,213 $ 49,704 $ 40,413 Other comprehensive income (loss): Foreign currency translation adjustment 1,497 694 (621) 127 -------------- --------------- -------------- --------------- Comprehensive income $ 21,429 $ 13,907 $ 49,083 $ 40,540 ============== =============== ============== ===============
See accompanying notes to consolidated financial statements. 6 ZEBRA TECHNOLOGIES CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in thousands) (Unaudited)
NINE MONTHS ENDED --------------------------------- OCTOBER 2, OCTOBER 3, 1999 1998 --------------- ---------------- Cash flows from operating activities: Net income $ 49,704 $ 40,413 Adjustments to reconcile net income to net cash Provided by operating activities: Depreciation and amortization 7,318 6,771 Depreciation (appreciation) in market value of investments and marketable securities (903) 281 Deferred income taxes 12 1,570 Gain on sale of subsidiary's assets - (404) Changes in assets and liabilities: Accounts receivable, net (13,182) (14,705) Inventories 3,627 2,137 Other assets (18) (502) Accounts payable 5,081 2,708 Accrued liabilities 188 (1,014) Income taxes payable 3,106 324 Other operating activities (1,478) (3,689) Net purchases of investments and marketable securities (44,155) (11,128) --------------- ---------------- Net cash provided by operating activities 9,300 22,762 --------------- ---------------- Cash flows from investing activities: Purchases of property and equipment (7,806) (19,676) Proceeds from sale of subsidiary - 2,660 Purchase of investments and marketable securities - (180) --------------- ---------------- Net cash used in investing activities (7,806) (17,196) --------------- ---------------- Cash flows from financing activities: Proceeds from exercise of stock options 7,748 1,025 Common stock purchased in connection with Eltron merger - (8,092) Borrowings on (repayment of) notes payable (252) 84 Payments for obligation under capital lease 7 (49) --------------- ---------------- Net cash provided by (used in) financing activities 7,503 (7,032) --------------- ---------------- Effect of exchange rate changes on cash (621) 127 --------------- ---------------- Net increase in cash and cash equivalents 8,376 (1,339) Cash and cash equivalents at beginning of period 11,391 10,925 --------------- ---------------- Cash and cash equivalents at end of period $ 19,767 $ 9,586 =============== ================ Supplemental disclosures of cash flow information: Interest paid $ 19 $ 402 Income taxes paid 25,989 17,357 Supplemental disclosures of noncash transactions: Book value of net assets sold and obligations recorded in connection with sale of subsidiary - 2,256
See accompanying notes to consolidated financial statements. 7 ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 - BASIS OF PRESENTATION The consolidated financial statements included herein have been prepared by Zebra Technologies Corporation and subsidiaries (the Company), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. These consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's latest Annual Report on Form 10-K filed with the Securities and Exchange Commission. The consolidated balance sheet as of December 31, 1998, presented herein, has been derived from the audited consolidated balance sheet contained in the Annual Report on Form 10-K. In the opinion of the Company, the interim consolidated financial statements reflect all adjustments necessary to present fairly the consolidated financial position of the Company as of October 2, 1999, the consolidated results of operations and comprehensive income for the three months and nine months ended October 2, 1999, and October 3, 1998, and cash flows for the nine months ended October 2, 1999, and October 3, 1998. The results of operations for such interim periods are not necessarily indicative of the results for the full year. On October 28, 1998, the Company merged with Eltron International, Inc. (Eltron). Eltron manufactures and markets high-quality, low-cost direct thermal and thermal transfer bar code printers, plastic card printers, secure card printing systems, ribbons, self-adhesive labels, and related accessories throughout the world. Financial results for the Company have been restated to reflect the merger as a pooling-of-interests. 8 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS: THIRD QUARTER OF 1999 VERSUS THIRD QUARTER OF 1998, AND YEAR-TO-DATE 1999 VERSUS YEAR-TO-DATE 1998 Net sales for the third quarter increased 18.1% to $103,988,000 from $88,068,000. Hardware sales (printers and replacement parts) increased 20.0%, driven by unit volume increases that were partially offset by lower average unit prices. For the third quarter, hardware sales accounted for 81.0% of net sales. Supplies sales increased 10.3% to comprise 16.9% of net sales. The remaining 2.0% of net sales consisted of service and software revenue. For the year to-date, net sales increased 13.8% to $291,131,000 from $255,906,000 in 1998. International sales for the third quarter of 1999 were $39,341,000, compared with $34,062,000 for a 15.5% increase. The Company's sales to North American customers increased 19.7% to $64,648,000 from $54,006,000. International sales comprised 37.8% of net sales in the third quarter of 1999 and 38.7% in the third quarter of 1998. For the first nine months of 1999, international sales increased 13.7% to $114,710,000 from $100,851,000 for the same period in 1998. Gross profit for the third quarter of 1999 increased 31.8% to $55,849,000 from $42,381,000. Gross profit margin increased to 53.7% from 48.1%. The increase in gross profit margin was due to lower average unit production costs and the higher sales volume, partially offset by lower average selling prices resulting from a change in product mix toward lower-margin products. For the first nine months of 1999, gross profit increased 19.2% to $146,524,000, or 50.3% of net sales, from $122,943,000, or 48.0% of net sales, in the same period of 1998. Selling and marketing expenses for the third quarter increased 10.1% to $9,937,000 from $9,028,000. The increase resulted primarily from higher trade show and advertising expenses, followed by higher personnel-related expenses resulting from increased staffing levels. As a percentage of net sales, third quarter selling and marketing expenses decreased to 9.6% from 10.3%. For the year to-date, selling and marketing expenses increased 12.2% to $29,679,000 from $26,441,000, but declined as a percentage of net sales to 10.2% from 10.3%. Research and development expenses for the third quarter decreased 4.0% to $5,219,000 from $5,437,000. This decrease was due to lower project, production supplies, and personnel-related expenses, partially offset by higher expenses related to outside consulting services. As a percentage of net sales, quarterly research and development expenses declined to 5.0% from 6.2%. For the year to-date, research and development expenses increased 1.6% to $16,225,000 from $15,972,000, but declined to 5.6% of net sales from 6.2% of net sales. General and administrative expenses for the third quarter increased by 18.0% to $7,721,000 from $6,544,000. The increase primarily resulted from higher expenses for computers and related equipment, building operations, and personnel resulting from higher staffing levels. As a percentage of net sales, quarterly general and administrative expenses were unchanged at 7.4%. For the year to-date, general and administrative expenses increased 16.1% to $23,005,000 from $19,812,000, and represented 7.9% of net sales compared with 7.7% of net sales. During the third quarter of 1999, Zebra recorded $1,581,000 in merger-related costs for the integration of Eltron operations. These costs, which could not be provided for at the time of the merger, include expenditures on consulting fees, as well as personnel-related expenses for relocation, severance, and recruitment. The Company expects to incur additional merger costs in the fourth quarter of 1999 and through the second quarter of 2000, the amounts of which are not currently estimable. For the year to-date, merger costs totaled $4,741,000. Operating income for the third quarter increased 46.9% to $31,391,000, or 30.2% of net sales, from $21,372,000, or 24.3% of net sales. Excluding the $1,581,000 in merger costs, operating income increased 54.3% to $32,972,000, or 31.7% of net sales. For the year to-date, operating income was $72,874,000, or 25.0% of net sales, up 20.0% from $60,718,000, or 23.7% of net sales. Excluding $4,741,000 in merger costs, 1999 year-to-date operating income increased 27.8% to $77,615,000, or 26.7% of net sales. Investment income increased to $1,389,000 from a loss of $401,000. The increase was principally due to a more normalized return on the Company's investment portfolio, compared with the loss resulting from the unusually high 9 volatility in the capital markets during the third quarter of 1998. For the year to-date, investment income increased 105.1% to $6,595,000 from $3,215,000, related to a more normalized return on the investment portfolio in 1999 as well as higher invested balances. Other expense for the third quarter of 1999 totaled $1,721,000, compared with $240,000 for the third quarter of 1998. The expense increase contains certain one-time items, including a settlement for some claims that were settled prior to any litigation and were unrelated to the company's operations. Income before income taxes for the third quarter of 1999 was $31,056,000, up 49.8% from $20,737,000 for the same period in 1998. For the year to-date, income before income taxes increased 22.8% to $78,064,000 from $63,573,000. The effective income tax rate for the third quarter of 1999 was 35.8%, compared with 36.3% for the same period in 1998. Net income was $19,932,000, or $0.63 per diluted share, compared with $13,213,000, or $0.42 per diluted share. Excluding the $1,581,000 in merger-related costs and related income tax benefit, net income for the third quarter of 1999 was $20,950,000, or $0.66 per diluted share. For the year to-date, the Company's effective income tax rate was 36.3%, compared with 36.4%. Net income was $49,704,000, or $1.58 per diluted share, compared with $40,413,000, or $1.30 per share on a diluted and primary basis. Excluding the $4,741,000 in merger-related costs and related income tax benefit in 1999, year-to-date net income was $52,723,000, or $1.68 per diluted share. LIQUIDITY AND CAPITAL RESOURCES The Company's principal source of liquidity continues to be cash generated from operations. Cash and cash equivalents and investments and marketable securities totaled $216,102,000 at October 2, 1999, compared with $162,668,000 at December 31, 1998. Management believes that existing capital resources and funds generated from operations are sufficient to finance anticipated capital requirements. YEAR 2000 CONSIDERATIONS INTERNAL SYSTEMS. Management believes that substantially all of the Company's critical internal computer systems and technical infrastructure are Year 2000 (Y2K) compliant. PRODUCTS. The Company has reviewed its entire product line for Y2K compliance issues and has identified those products that will be affected. In general, Y2K issues do not affect the Company's printer products because they contain no internal clock or timing mechanism. The Company recently introduced an internal real time clock feature on a limited number of Zebra-brand printers. In addition, certain Eltron-brand printer products are available with an optional internal time and date clock. These features are Y2K compliant. In addition, the Company's PC-470 printer controller contains a real-time clock that must be reset to function properly after January 1, 2000. All but one of the Company's current software products are Y2K compliant, although in some cases previous versions of these software products were not Y2K compliant. An updated Y2K-compliant version of the one software product that is not currently Y2K compliant has been completed and is in quality testing. This upgrade is expected to be released for distribution around the end of November 1999. In all cases where products are not Y2K compliant, customers have been notified via letter or postings on the Company's web site about any corrective action that is needed, including, where appropriate, a requirement to upgrade certain software products. SUPPLIERS. The Company surveyed each of its significant suppliers to determine their ability to provide necessary products and services that are critical to business continuation through Y2K. They have advised us that they expect no adverse affect from Y2K on their ability to support Zebra's manufacturing and distribution operations. Despite these assurances of compliance, the Company does not warrant the performance of its suppliers. The failure by one or more significant suppliers to achieve compliance could have a material adverse effect on the Company. The Company has not undertaken to quantify the effect of such possible non-compliance or to determine the likely worst-case scenario or to develop contingency plans to deal with such a scenario. Management estimates that it will have incurred approximately $400,000 of costs to ensure Y2K compliance by December 31, 1999. This includes approximately $200,000 of direct expenditures to upgrade its systems and products and approximately $200,000 of management and internal technical support to upgrade systems and ensure the status of compliance within the Company's supplier base. This estimate does not include the cost of new systems 10 or system upgrades that were made for reasons other than Y2K compliance but included Y2K compliance as part of the upgrade package. Specifically excluded from the cost of Y2K compliance is the cost of the Company's recent conversion to the Baan ERP system and the cost of its new payroll/human resources system, both of which were made for reasons other than Y2K compliance. SIGNIFICANT CUSTOMER During the third quarter of 1999, sales to ScanSource, Inc., represented 12.5% of net sales, but represented less than 10.0% of net sales for the year to-date and for the corresponding periods in 1998. No other single customer comprised 10.0% or more of the Company's sales for the third quarter of 1999 or the year to-date. Sales to one of the Company's designated key accounts, United Parcel Service (UPS), however, accounted for 11.0% of total sales for the first nine months of 1998. 11 SAFE HARBOR Forward-looking statements contained in this filing are subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995 and are highly dependent upon a variety of important factors which could cause actual results to differ materially from those reflected in such forward looking statements. These factors include market acceptance of the Company's printer and software products and competitors' product offerings. They also include the success and speed of the Company's integration with Eltron, as well as the effect of market conditions in the various regions of the world in which the Company conducts business on the Company's financial results. Profits will be affected by the Company's ability to control manufacturing and operating costs. Because of the Company's large investment portfolio, interest rate and financial market conditions will also have an impact on results. Foreign exchange rates will have an effect on financial results due to the large percentage of the Company's international sales. When used in this document and documents referenced, the words "anticipate," "believe," "estimate," and "expect" and similar expressions as they relate to the Company or its management are intended to identify such forward-looking statements. Readers of this document are referred to prior filings with the Securities and Exchange Commission, including Zebra's Form 10-K for the year ended December 31, 1998, and the joint proxy statement/prospectus dated September 21, 1998, particularly the "Risk Factors" section, for further discussions of issues that could affect Zebra's future results. 12 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK There have been no material changes in the Company's market risk during the third quarter ended October 2, 1999. For additional information on market risk, refer to the "Quantitative and Qualitative Disclosures About Market Risk" section of the Company's Annual Report on Form 10-K for the year ended December 31, 1998. 13 PART II - OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits. 15.1 Acknowledgment of Independent Certified Public Accountants Regarding Independent Auditors' Review Report 27.1 Financial Data Schedule 27.2 Restated Financial Data Schedule (b) Reports. No reports on Form 8-K have been filed by the Registrant for the quarterly period covered by this report. 14 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 thereunto duly authorized. ZEBRA TECHNOLOGIES CORPORATION Date: November 10, 1999 By: /s/Edward L. Kaplan ------------------- Edward L. Kaplan Chief Executive Officer Date: November 10, 1999 By: /s/Charles R. Whitchurch ------------------------ Charles R. Whitchurch Chief Financial Officer 15 EX-15.1 2 EXHIBIT 15.1 Exhibit 15.1 ACKNOWLEDGMENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS REGARDING INDEPENDENT AUDITORS' REVIEW REPORT Zebra Technologies Corporation 333 Corporate Woods Parkway Vernon Hills, Illinois 60061-3109 Ladies and Gentlemen: With respect to the registration statements (No. 33-44706, No. 33-72774, No. 333-59733, and No. 333-63009) on Form S-8 of Zebra Technologies Corporation, we acknowledge our awareness of the incorporation by reference therein of our report dated October 27, 1999, related to our review of interim financial information as of October 2, 1999. Pursuant to Rule 436(c) under the Securities Act of 1933, such report is not considered part of a registration statement prepared or certified by an accountant or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of the Act. Very truly yours, /s/KPMG LLP Chicago, Illinois November 10, 1999 16 EX-27.1 3 EXHIBIT 27.1
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS AS OF OCTOBER 2, 1999, AND CONSOLIDATED STATEMENT OF EARNINGS FOR NINE MONTHS ENDED OCTOBER 2, 1999, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA. 1,000 9-MOS DEC-31-1999 JAN-01-1999 OCT-02-1999 19,767 196,335 74,215 (3,379) 36,057 331,643 71,693 (32,133) 375,680 45,125 0 0 0 314 327,401 375,680 287,118 291,131 142,003 144,607 72,653 997 19 78,064 28,360 49,704 0 0 0 49,704 1.60 1.58
EX-27.2 4 EXHIBIT 27.2
5 THIS SCHEDULE CONTAINS SUMMARY FIN INFO EXTRACTED FROM ZEBRA TECH CORP AND SUBSIDIARIES CNSLDTD BALANCE SHEET AS OF 10-3-98, AND CNSLDTD STMT OF EARNINGS FOR THE 9 MOS ENDED 10-3-98, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FIN STMTS. THE RESTATED FIGURES HEREIN REFLECT THE COMPANY'S MERGER WITH ELTRON INTL, INC., WHICH WAS ACCOUNTED FOR ON A POOLING OF INTERESTS BASIS. 1,000 9-MOS DEC-31-1997 JAN-01-1998 OCT-02-1998 9,586 139,422 67,872 (2,102) 41,605 266,233 61,989 (25,907) 307,273 35,606 0 0 0 309 269,385 307,273 252,676 255,906 131,502 132,963 62,127 98 402 63,573 23,160 40,413 0 0 0 40,413 1.30 1.30
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