Wi-LAN Announces 2001 Second Quarter Results.

Business Editors

CALGARY--(BUSINESS WIRE)--June 13, 2001

Wi-LAN Inc. (TSE:WIN.), an innovator of wireless data/Internet communications, today announced financial results for the quarter and six months ended April 30, 2001.

Wi-LAN's broadband wireless revenue for the six months ended April 30, 2001 was $10.7 million, approximately 23% greater than the $8.7 million of broadband wireless revenue for the previous six months ended October 31, 2000, and 84% of the estimated $12.7 million for the six months ended April 30, 2001. The $2.0 million shortfall between the estimated and actual broadband wireless revenue is attributed to slower than expected customer equipment roll-outs, caused largely by slowing macro-economic conditions in North America.

For the six months ended April 30, 2001, Wi-LAN saw a decrease in consolidated revenue of 11% to $44.1 million compared with $48.7 million for the previous six months ending October 31, 2000. This decrease can be attributed to a reduction in the revenue contribution of Wi-LAN's U.S. subsidiary Digital Transmission Systems (DTS), partly offset by increased broadband wireless equipment sales and increased narrowband antenna sales.

Six-Month Financial Highlights

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(In thousands of dollars 6 months ended 6 months ended except where
 noted) April 30, 2001 October 31, 2000
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Consolidated revenue                      $44,079          $48,696
Broadband revenue - Product                10,396            8,679
                  -- License and
                     technology               335               75
DTS and other revenue                      33,348           39,942
Gross product margin - Wi-LAN                 28%              27%
                     -- DTS                   32%              34%
Sales and marketing expense                $9,955          $10,424
Research and development expense            7,805            6,995
Operating loss                             18,893           18,543
Cash outflow used for operations           17,229           27,434
Cash balance                                9,970           13,790
Shareholders' equity                       82,516           74,706
Total assets                              137,015          136,191

Included in cost of sales for the second quarter ended April 30, 2001 is a $0.7 million reserve for technological obsolescence of certain raw material components. Wi-LAN gross product margin excluding such reserve was 34% for the six-month period ended April 30, 2001. Wi-LAN gross product margin, excluding DTS and the aforementioned reserve, increased seven percentage points from 27% to 34% due to higher broadband antenna sales, offsetting continued selected discounted pricing for volume and strategic customer broadband equipment orders to accelerate market penetration. Sales and marketing expenses decreased by $0.5 million from $10.4 to $9.9 million, and research and development expenses increased $0.8 million from $7.0 to $7.8 million in the six months ended April 30, 2001, compared with the six months ended October 31, 2000. These changes reflect decreased sales and marketing expenditures by DTS, as well as increased spending on new product development.

The company's loss from operations increased by $0.4 million from $18.5 to $18.9 million primarily due to increased operating losses experienced by DTS. Wi-LAN's standalone operating loss for the six months ended April 30, 2001, excluding DTS, was essentially unchanged at $15.3 million, compared to $15.4 million for the six months ended October 31, 2000. DTS' operating loss for the six months ended April 30, 2001 increased by $0.4 million to $3.6 million, compared to a loss of $3.2 million for the prior six months, primarily due to reduced sales.

Quarter over Quarter Revenue Growth

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(In thousands of dollars)                 3 months ended
                           ----------------------------------------
                             July 31,  Oct. 31,  Jan. 31,  Apr. 30,
                                2000      2000      2001      2001
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Broadband - Product           $3,528    $5,151    $4,863    $5,533
          -- License and
             technology            -        75       318        17
DTS and other                 17,375    22,567    15,627    17,721
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Consolidated revenue         $20,903   $27,793   $20,808   $23,271
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Quarterly growth - broadband     16%       48%       -1%        7%
                 - total         82%       33%      -25%       12%

2001 Second Quarter Operational Highlights

Wi-LAN accomplished several significant strategic initiatives in the second quarter that will contribute to the company's future growth.

Customer Supply Agreement: Wi-LAN signed a two-year supply agreement with NetCom AB (NASDAQ: NECSA and NECSB) a leading alternative pan-European telecommunications company and the parent company of Tele2. Under terms of the agreement, NetCom AB will purchase Wi-LAN's broadband wireless access systems, based on its patented Wide-band Orthogonal Frequency Division Multiplexing (W-OFDM) technology, which will be used to build wireless networks initially in Poland, Finland, Sweden, Denmark, Norway, and the Czech Republic.

Original Equipment Manufacturing (OEM) Agreement: Wi-LAN signed a three-year OEM agreement with Symbol Technologies, Inc (NYSE: SBL), the leader in wireless and mobile data transactions and systems. Under the terms of agreement, Wi-LAN will provide Wi-LAN AWE advanced wireless Ethernet bridges and TIL-TEK antenna systems to Symbol. Wi-LAN's products will be used to complement Symbol's wireless LAN and POS product offerings for several growth market segments including retail, healthcare, education, manufacturing and government. Additional Wi-LAN products may be added to this agreement as they become available.

Contract Manufacturing Agreement: Wi-LAN signed a one-year renewable supply agreement with Solectron Corporation (NYSE: SLR) the world's leading provider of electronics manufacturing and supply-chain management services, to produce Wi-LAN's W-OFDM broadband wireless access systems. Solectron's state-of-the-art manufacturing facilities in North America, Europe, Asia and Latin America will provide Wi-LAN with the ability to manufacture its products in close proximity to its growing global customer base.

Acquisition: Wi-LAN acquired UC Wireless, a privately held fixed wireless access equipment supplier, which will operate as a wholly owned subsidiary of Wi-LAN. This acquisition provides Wi-LAN with increased reach and access to worldwide customers. In addition, Wi-LAN gained control of UC Wireless' established portfolio of wireless WAN products that are complementary to Wi-LAN's product lines as well as significant resources in the areas of DSP, software and RF engineering. Wi-LAN also gained access to UC Wireless' proprietary Versatile Intelligent Network Environment (VINE) technology, an anypoint-to-multipoint network architecture that is used to economically solve non-line-of-sight (NLOS) challenges. Wi-LAN acquired substantially all of UC Wireless' assets in exchange for approximately 1.7 million shares of Wi-LAN common stock. Wi-LAN plans to continue UC Wireless' operations out of Santa Barbara, California.

Product Launch: At the Broadband World Wireless Forum in San Francisco, Wi-LAN launched the AWE 120-58, a new 12-megabit-per-second advanced wireless Ethernet bridge for use in the 5.8 GHz unlicensed frequency band that uses Wi-LAN's patented MC-DSSS technology.

Product Certifications: Wi-LAN received product certification for the AWE 120-24 and the Broadband Wireless System (BWS) 300-24 by the Chinese State Regulatory Radio Commission (SRRC), for the AWE 120-58 by the United States Federal Communications Commission (FCC) and by Industry Canada, and for the BWS Series 3000 by the European Telecommunications Standards Institute (ETSI).

Financing: Wi-LAN initiated a financing in the form of a public offering of 937,500 units at a price of $8.00 per unit for gross proceeds of $7.5 million. The offering was sold to Research Capital Corporation with an option to purchase up to an additional 625,000 units for total potential proceeds of $12.5 million. With the filing of the final prospectus, the underwritten portion of the financing was increased to 1,175,000 units (gross proceeds of $9.4 million), and the underwriter's option was adjusted to keep total potential proceeds at $12.5 million. When the offering closed on May 15, total gross proceeds were $11.6 million. The net proceeds of the offering will be used to provide additional funding for product development, to support sales growth and for general corporate purposes. Each unit consists of one common share and one-half of one common share purchase warrant. Each full warrant will entitle the holder to acquire one common share of Wi-LAN at an exercise price of $9.50 at any time on or before May 15, 2003.

Subsequent Events

On May 10, 2001, Wi-LAN announced that at an open commission meeting, the Federal Communications Commission (FCC) granted Wi-LAN an interim waiver to permit the sale and use of W-OFDM products in the United States while the FCC reviews proposed changes to the rules affecting spread spectrum devices in the 2.4 GHz band. On June 5, 2001, the OFDM-based BWS 300-24 product was certified by the FCC for use in the 2.4 GHz band in the United States. Wi-LAN is the first company to receive certification from the FCC for the use of OFDM technology in the 2.4 GHz band.

Wi-LAN was recognized by Profit 100 Magazine's PROFIT 100 - Canada's Fastest Growing Companies competition as the fourth fastest-growing company in Canada, and first in the Prairie region, on the basis of revenue. Wi-LAN was also recognized as one of the country's best-performing publicly traded high-technology companies for 2001 according to Canadian Business Magazine's annual Tech 100 listing. Wi-LAN received top rankings in numerous categories, leading to an overall ranking of fifth across Canada.

All financial information in this document is reported in Canadian dollars, unless otherwise indicated.

Conference Call Information

The Wi-LAN second quarter conference call will be held on June 14, 2001 at 9 a.m. Mountain Time (11 a.m. Eastern). The call-in number is 416-695-5801 in Toronto or 1-800-478-9326. A replay of the call will be available until 10:00 p.m. MST (12 a.m. EST) on June 20 at 416-695-5800 / 1-800-408-3053 (passcode: 720238). The call will also be audio webcast from Wi-LAN's website (www.wi-lan.com) and will be archived there.

About Wi-LAN Inc.

Wi-LAN, based in Calgary, Canada, is an innovator in the field of high-speed wireless data communications, specializing in high-speed Internet access, LAN/WAN extension and broadband wireless access. Wi-LAN is the Chair Company of the OFDM Forum (www.ofdm-forum.com). Wi-LAN believes its W-OFDM patent is necessary for the implementation of devices using the IEEE 802.11a or ETSI BRAN HiperLAN/2 standards. Wi-LAN's products have been sold in more than 50 countries on six continents. Wi-LAN's common shares trade on The Toronto Stock Exchange under the symbol "WIN."

Detailed information on Wi-LAN can be found at http://www.wi-lan.com.

FORWARD LOOKING INFORMATION

Certain statements in this release, other than statements of historical fact, are forward-looking information that involves various risks and uncertainties. These can include, without limitation, statements based on current expectations involving a number of risks and uncertainties related to all aspects of the wireless data communications industry. These risks and uncertainties include, but are not restricted to, continued increased demand for the Company's products, the Company's ability to maintain its technological leadership in the field of high-speed data communications, the Company's ability to attract and retain key employees, the enforceability of the Company's patents, the availability of key components, competition in the wireless industry, technological change, risk of third party claims of infringement, inability to protect the Company's intellectual property against unauthorized or infringing uses, management of growth and expansion, limited financial resources and the need for future financing, and the Company's ability to raise capital on acceptable terms when needed.

These uncertainties may cause actual results to differ from information contained herein. There can be no assurance that such statements will prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral forward-looking statements are based on the estimates and opinions of management on the dates they are made and expressly qualified in their entirety by this notice. The Company assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change.

Wi-LAN INC.
Consolidated Balance Sheets
(in thousands of dollars)

------------------------------------------------------------------
------------------------------------------------------------------
                                  April 30, 2001  October 31, 2000
                                     (Unaudited)
------------------------------------------------------------------

Assets

Current assets:
  Cash                               $    9,970       $    13,790
  Accounts receivable                    21,568            26,446
  Trade notes receivable                    869               457
  Inventories                            32,307            25,869
  Prepaid expenses and deposits           6,813             7,659
  -----------------------------------------------------------------
                                         71,527            74,221

Capital assets                           11,204            11,121
Long-term investments                     6,093             2,156
Trade notes receivable                    1,277               846
Goodwill and intangible assets           46,914            47,847
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                                     $  137,015       $   136,191
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-------------------------------------------------------------------

Liabilities and Shareholders' Equity

Current liabilities:
  Lines of credit                    $   14,771       $    17,735
  Accounts payable and accrued
   liabilities                           27,884            24,983
  Notes and acquisition costs
   payable to related parties             4,872             6,899
  Deferred revenue                           29             1,029
  Customer deposits payable                 491             1,872
  Warranty liabilities                      996               871
  -----------------------------------------------------------------
                                         49,043            53,389

Long-term debt                              267               267
Non-controlling interest in subsidiary    5,189             7,829

Shareholders' equity:
  Share capital                         134,942           107,544
  Contributed surplus                       400               400
  Deficit                               (52,826)          (33,238)
  -----------------------------------------------------------------
                                         82,516            74,706

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                                     $  137,015       $   136,191
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Wi-LAN INC.
Consolidated Statements of Operations and Deficit
(Unaudited)
(in thousands of dollars, except per share amounts)

-------------------------------------------------------------------
-------------------------------------------------------------------
                          Three months ended      Six months ended
                               April 30               April 30
                             2001      2000       2001       2000

Revenue:
  Product                 $ 23,254  $ 11,482   $ 43,744   $ 13,654
  License and technology        17         -        335      1,041
  -----------------------------------------------------------------
                            23,271    11,482     44,079     14,695

Cost of product sales       16,350     6,209     30,378      7,148
-------------------------------------------------------------------
                             6,921     5,273     13,701      7,547

Expenses:
  Sales and marketing        5,197     2,525      9,955      3,335
  Research and development   3,976     1,866      7,805      2,854
  General and administrative 2,790     1,860      5,924      2,458
  Product and customer
   services                  2,851     1,522      5,421      2,033
  Business development         485       700      1,247        845
  Depreciation and
   amortization              1,247       408      2,242        499
  -----------------------------------------------------------------
                            16,546     8,881     32,594     12,024

-------------------------------------------------------------------
Operating loss before the
 following                  (9,625)   (3,608)   (18,893)    (4,477)

Amortization of goodwill    (5,554)     (971)    (8,262)    (1,085)
Non-controlling interest
 in DTS net loss             2,974       124      5,043        124
Dilution gain on DTS             -     2,911          -      2,911
Interest, bank charges and
 preferred share premium
 accretion                    (709)     (464)    (1,144)      (514)
Interest income and gains on
 disposals                      44       719      3,905        850
Foreign exchange gain (loss)   349      (300)      (237)      (312)
-------------------------------------------------------------------
Net loss                   (12,521)   (1,589)   (19,588)    (2,503)

Deficit, beginning of
 period                    (40,305)  (16,008)   (33,238)   (15,094)

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Deficit, end of period     (52,826)  (17,597)  $(52,826)  $(17,597)
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Loss per share             $ (0.50) $  (0.08)  $  (0.80)  $  (0.12)
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Wi-LAN INC.
Consolidated Statements of Cash Flows
(Unaudited)
(in thousands of dollars)

-------------------------------------------------------------------
-------------------------------------------------------------------
                          Three months ended      Six months ended
                                April 30               April 30
                             2001       2000       2001       2000
-------------------------------------------------------------------

Cash provided by (used in):

Operations:
  Net loss               $(12,521)  $ (1,589)  $(19,588)  $ (2,503)
  Items not involving
   cash:
    Depreciation and
     amortization           6,801      1,379     10,504      1,584
    Dilution gain on DTS        -     (2,911)         -     (2,911)
    Non-controlling
     interest in net loss  (2,974)      (124)    (5,043)      (124)
    Gain on disposal of
     assets                   (20)         -     (3,539)         -
    Loss on foreign
     exchange and other      (692)         9       (810)        27

Change in non-cash operating working capital balances:
    Accounts receivable    (1,727)    (4,438)     5,393     (4,113)
    Trade notes receivable    642          -       (877)         -
    Inventories              (342)     1,250     (4,803)       337
    Prepaid expenses and
     deposits               1,088         (2)       889       (126)
    Accounts payable and
     accrued liabilities    1,388      3,211      2,901      2,882
    Notes and acquisition
     costs payable              -        176          -        (74)
    Customer deposits
     payable                 (312)         -     (1,381)         -
    Deferred revenues        (438)      (140)    (1,000)    (1,181)
    Warranty liabilities     (160)       (20)       125        (21)
  -----------------------------------------------------------------
                           (9,267)    (3,199)   (17,229)    (6,223)

Financing:
  Share capital issued for
   cash                        36     29,862     15,164     30,945
  Lines of credit            (440)     5,336     (2,964)     5,298
  Non-controlling interest
   introduced                  34        354        211        354
  Redemption of preferred
   shares                       -       (280)         -       (280)
  -----------------------------------------------------------------
                             (370)    35,272     12,411     36,317

Investments:
  Capital and intangible
   assets                    (619)    (1,117)    (2,103)    (1,537)
  Long-term investments      (734)       (25)      (933)    (1,497)
  Proceeds from disposal
   of long-term investment     10          -      4,211          -
  Cash paid on acquisition
   of Telcor                    -     (3,526)      (177)    (3,526)
  Cash paid on acquisition
   of DTS                       -          -          -       (759)
  Other assets                  -       (510)         -       (492)
  -----------------------------------------------------------------
                           (1,343)    (5,178)       998     (7,811)

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Change in cash            (10,980)    26,895     (3,820)    22,283

Cash, beginning of period  20,950     10,381     13,790     14,993

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Cash, end of period      $  9,970   $ 37,276   $  9,970   $ 37,276
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Cash consists of cash on hand and balances with banks.