Andrew Corporation Reports Third Quarter Results.ORLAND PARK Or·land Park A village of northeast Illinois, a residential and manufacturing suburb of Chicago. Population: 53,300. , Ill.--(BUSINESS WIRE)--July 15, 1999-- Andrew Corporation Andrew Corporation is an American multinational producer of communications devices. Andrew is a global designer, manufacturer, and supplier of communications equipment, services, and systems. (Nasdaq:ANDW), a global supplier of communication equipment, today reported results for the third fiscal quarter and nine months ended June 30, 1999. For the quarter, orders were $216.7 million, sales were $186.1 million and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. net income per share was $.18. The orders total of $216.7 million was up 2% from $213.0 million last year. Sales were $186.1 million, 9% below last year's $204.2 million. Net income was $14.7 million, down 40% compared with $24.6 million for the same period last year. Diluted net income per share for the third quarter declined to $.18, down 36% from $.28 last year. Excluding the effect of a reduction in the year to date tax rate from 34% to 32%, diluted net income per share was $.16. The tax rate was reduced to reflect the increasing proportion of earnings coming from outside the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . Floyd English, chairman, president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. stated, "The pace of business showed signs of recovery during the June 1999 quarter, especially for orders. Orders were 23% higher than in the preceding quarter. The orders strength stemmed mainly from the United States, Asia Pacific and South America South America, fourth largest continent (1991 est. pop. 299,150,000), c.6,880,000 sq mi (17,819,000 sq km), the southern of the two continents of the Western Hemisphere. . Sales improved at a more gradual pace, up 8% from the March quarter, driven by increased customer spending for wireless infrastructure in the United States and China. The strong order rate gives us confidence that we can continue to see sequential sales improvements in the fourth quarter. "Sales, while improved over the preceding quarter, declined $18.1 million compared to the same quarter in the prior year. Lower customer spending for new site construction in the U.S. wireless infrastructure market accounted for most of the decline. The common carrier & private microwave markets were up in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. though down worldwide. Broadcast was up strongly in the U.S. but overall the broadcast and government markets outside North America, and the wireless accessories business were down. Wireless infrastructure sales in Asia and in Europe grew at double-digit rates compared to the prior year's third quarter." The 23% increase in orders compared to the preceding quarter was driven by the wireless infrastructure market in the United States. The company's first major LMDS (Local Multipoint Distribution Service) A digital wireless transmission system that works in the 28 GHz range in the U.S. and 24-40 GHz overseas. It requires line of sight between transmitter and receiving antenna, which can be from one to four miles apart (Local Multipoint Distribution Services LMDS is a broadband wireless access technology governed by the IEEE and is outlined by the 802 LAN/MAN Standards Committee through the efforts of the IEEE 802.16.1 Task Group. LMDS commonly operates on microwave frequencies across the 26GHz and 29GHz bands. ) antenna order of $1.6 million was a part of the incremental Additional or increased growth, bulk, quantity, number, or value; enlarged. Incremental cost is additional or increased cost of an item or service apart from its actual cost. order activity. LMDS is an emerging millimeter One thousandth of a meter, or 1/25th of an inch. See metric system. wave service designed to provide high speed internet access See how to access the Internet. and two-way, broadband, wireless transmission of data, voice, and video. Large orders for equipment buildings, cable and other products for use in specialized mobile radio See SMR. applications totaled over $18 million. Orders were received for over $3 million worth of equipment buildings to be used in Internet fiber optic networks. Brazil led the order strength in South America with three large terrestrial microwave and cable orders exceeding $1.0 million each. These Andrew products are used in wireless infrastructure and long distance backbone networks A backbone network provides a path for the exchange of information between different LANs or subnetworks.[1] A backbone can tie together diverse networks in the same building, in different buildings in a campus environment, or over wide areas. to support the traffic generated by Brazil's expanding cellular networks. In the Asia Pacific region, quarterly orders grew 100% sequentially with six large wireless infrastructure orders booked for cellular site construction in China, Japan, and Taiwan that totaled $11.5 million. During the June 1999 quarter, 252,500 shares of stock were repurchased. As of June 30, 1999 total outstanding shares were 82.0 million. Since May 1997 the company has repurchased a total of 10.0 million shares for a total cost of $198 million. At June 30, 1999, 5.0 million shares are authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: for repurchase. Forward Looking Statements Some of the statements in this news release are forward looking statements and we caution our stockholders and others that these statements involve certain risks and uncertainties. Factors that may cause actual results to differ from expected results include, but are not limited to the effects, of competitive products and pricing, economic and political conditions that may impact customers' ability to fund purchases of our products and services, the company's ability to achieve the costs savings anticipated from cost reduction programs, fluctuations in international exchange rates, end use demand for wireless communication services, and other business factors. Investors should also review other risks and uncertainties discussed in company documents filed with the Securities Exchange Commission. Andrew Corporation is a global supplier of communications systems In telecommunication, a communications system is a collection of individual communications networks, transmission systems, relay stations, tributary stations, and data terminal equipment (DTE) usually capable of interconnection and interoperation to form an integrated whole. , equipment and services. Major markets are wireless communications wireless communications System using radio-frequency, infrared, microwave, or other types of electromagnetic or acoustic waves in place of wires, cables, or fibre optics to transmit signals or data. which includes cellular, personal communications services See PCS. , and land mobile radio--broadcast and common carrier. Andrew is an S&P 500 company whose common stock trades on The Nasdaq Stock Market Nasdaq stock market The first electronic stock market listing over 5000 companies. The Nasdaq stock market comprises two separate markets, namely the Nasdaq National Market, which trades large, active securities and the Nasdaq Smallcap Market that trades emerging growth companies. (R) under the symbol: ANDW.
PRELIMINARY
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ANDREW CORPORATION
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In thousands, except per share amounts)
Three Months Ended Nine Months Ended
June 30 June 30
------------------ -----------------
1999 1998 1999 1998
------ ------ ------ ------
Sales $186,079 $204,220 $576,658 $632,228
Cost of Products
Sold 126,948 122,905 392,829(A) 384,206
-------- -------- -------- --------
Gross Profit 59,131 81,315 183,829 248,022
Operating Expenses
Research and
development 7,643 6,502 20,557 19,828
Sales and
administrative 34,203 37,375 105,866 110,640
Restructuring
Expenses 0 0 29,817 0
-------- -------- -------- --------
41,846 43,877 156,240 130,468
-------- -------- -------- --------
Operating Income 17,285 37,438 27,589(B) 117,554
Other
Interest expense 1,419 1,707 4,087 4,868
Interest income (3,327) (2,413) (7,149) (5,307)
Other (income)
expense (850) 887 1,211 1,219
-------- -------- -------- --------
(2,758) 181 (1,851) 780
-------- -------- -------- --------
Pretax Income 20,043 37,257 29,440(B) 116,774
Income taxes 5,308 12,667 12,373 39,703
-------- -------- -------- --------
Net Income $ 14,735 $ 24,590 $ 17,067(B) $ 77,071
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Basic and
Diluted Earnings
per Share $ .18 $ 0.28 $ 0.21(B) $ 0.87
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Average Shares Outstanding
Basic 82,187 88,227 82,876 88,630
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Diluted 82,294 88,545 82,989 89,061
======== ======== ======== ========
Orders 216,653 212,956 585,789 640,556
Backlog 141,264 122,818 141,264 122,818
Total Backlog 151,006 139,914 151,006 139,914
(A) Includes $6,888 for expenses related to restructuring.
(B) Includes March 1999 restructuring charge of $36,705 pretax,
$28,120 after-tax, $.34 per share.
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