CommScope Reports First Quarter Results; Earnings of $0.32 Per Share on Revenues of $217 Million

Apr 24, 2001, 01:00 ET from CommScope, Inc.

    HICKORY, N.C., April 24 /PRNewswire Interactive News Release/ --
     CommScope, Inc. (NYSE:   CTV), a world leader in the manufacture of
 broadband and high-performance communication cables, today announced first
 quarter sales and earnings per share for the period ended March 31, 2001.
 Diluted earnings per share were $0.32 in this year's first quarter compared to
 $0.32 per diluted share in the first quarter of 2000.  Earnings for the
 current quarter include charges of approximately $0.01 per share related to
 previously announced layoffs.
     Sales for the first quarter increased 7% to $217.4 million, compared to
 $203.9 million in the first quarter of 2000.   This performance was primarily
 driven by sales of broadband cable for Hybrid Fiber Coax (HFC) applications.
 Domestic sales rose to $155.7 million, up approximately 1% from the first
 quarter of 2000.  International sales rose to $61.7 million for the current
 quarter, up approximately 23% year over year.
     Orders booked in the first quarter were $186.4 million, down 31% from the
 first quarter of 2000 and down 9% sequentially.  Orders reflect a significant
 slowdown in both domestic and international markets.
     Chairman and Chief Executive Officer Frank M. Drendel said, "Challenging
 economic conditions continue to affect worldwide capital spending for
 communications networks.  Until we see clear signs of a recovery, we intend to
 closely manage cost and continue reviewing our capacity plans."
     Net income for the current quarter was $16.6 million, compared to
 $16.7 million in the first quarter of 2000.
 
     Other First-Quarter Highlights
     * Broadband/Video sales worldwide increased 15% year over year to
       approximately $170.1 million for the current quarter led by strong sales
       of fiber optic cable.  Domestic Broadband/Video sales rose approximately
       11% year over year.  International sales were $61.7 million, up 23% year
       over year and essentially equal to fourth quarter 2000 levels.  Sales
       were particularly strong to the Latin American market.
 
     "The long-term potential of the Latin American market was a key reason we
 decided to open a facility in Brazil for wired and wireless cable products,"
 noted Drendel.
 
     * Local Area Network (LAN) sales were $24.1 million in the current quarter
       compared to $24.8 million in the same period last year.  LAN sales rose
       64% sequentially.
 
     "During the fourth quarter of 2000, we laid a solid foundation for the
 improvement in our LAN business," said Drendel.  "In addition, we believe the
 stronger strategic partnership with the Siemon Company has improved our
 ability to provide world-class network cabling infrastructure solutions to
 customers across the United States."
 
     * Wireless and Other Telecom sales were $23.2 million in the current
       quarter, compared to approximately $31.5 million in the same period last
       year.  Sales of Other Telecom products declined due primarily to lower
       capital spending for telephone central office applications and
       increasing competitive pressures.  Sales of Wireless products weakened
       due primarily to the slowdown in domestic wireless infrastructure
       spending.  However, wireless order trends improved significantly during
       March.
     * Total Company gross margin for the first quarter was approximately
       24.3%, down approximately 1.4 percentage points from the first quarter
       of 2000 and down approximately 3.2 percentage points sequentially.  The
       sequential decline in gross margin resulted primarily from lower sales
       volumes and shifting product mix.  Operating margin was approximately
       12.9%.
     * In response to market conditions, the Company took steps to align its
       work force with customer demand and eliminated approximately
       500 permanent positions or about 13% of its workforce during the first
       quarter.
 
     Outlook
     As a result of challenging market conditions and continued softness in
 demand, the Company expects that its second quarter revenue will range from
 flat to down 10% sequentially.
     "We do not have good visibility regarding our performance for the
 remainder of 2001," said Drendel.  "However, over the longer term we believe
 that our superior portfolio of products, strong cash flow and excellent
 balance sheet will help us emerge from the current downturn strongly
 positioned to participate in the construction of communications networks
 around the world."
 
     Conference Call Information
     The Company plans to hold a telephonic conference call to discuss first
 quarter results today at 5:00 p.m. Eastern Time.  To participate in the
 conference call, all participants should dial 212-896-6091.  Please plan to
 dial in about 10 minutes before the start of the call to facilitate a timely
 connection.  The live, listen-only audio of the conference call will also be
 available at http://www.videonewswire.com/COMMSCOPE/042401/.
     If you are unable to participate in the call and would like to hear a
 telephonic replay, you may dial 800-633-8284.  International callers should
 dial 858-812-6440 for the replay.  The replay ID is 18440382.  The replay will
 be available through Thursday, April 26, 2001.  A webcast replay will also be
 archived for a limited period of time following the conference call via the
 Internet on CommScope's web site (http://www.commscope.com).
     CommScope is the world's largest manufacturer of broadband coaxial cable
 for Hybrid Fiber Coax (HFC) applications and is a leading supplier of high-
 performance fiber optic and twisted pair cables for LAN, wireless and other
 communications applications.
     This press release contains forward-looking statements regarding first-
 quarter earnings and outlook that are based on information currently available
 to management, management's beliefs and a number of assumptions concerning
 future events.  Forward-looking statements are not a guarantee of performance
 and are subject to a number of uncertainties and other factors, which could
 cause the actual results to differ materially from those currently expected.
 The potential risks and uncertainties that could cause actual results to
 differ materially include, but are not limited to, the ability of the company
 to implement cost reductions in a timely manner and the success of those
 actions, worldwide economic conditions, telecommunications industry capital
 spending, expected demand from AT&T and others, excess capacity, changes in
 cost and availability of key raw materials, successful implementation of the
 bimetals operation and other vertical integration activities, pricing and
 acceptance of CommScope's products, successful expansion and related operation
 of our facilities, effective implementation of our integrated information
 system, developments in technology, industry competition, ability of our
 customers to secure adequate financing, regulatory changes affecting our
 industries and other factors.  For a more detailed description of factors that
 could cause such a difference, please see CommScope's filings with the
 Securities and Exchange Commission.  In providing forward-looking statements,
 the Company does not intend, and is not undertaking any duty or obligation, to
 update these statements as a result of new information, future events or
 otherwise.
 
 
     CONTACTS:
     Phil Armstrong            Betsy Lambert, APR
     Investor Relations        Media Relations
     (828) 323-4848            (828) 323-4873
 
 
                                 CommScope, Inc.
                    Condensed Consolidated Statements of Income
          (Unaudited--in thousands, except net income per share amounts)
 
 
                                                        Three Months Ended
                                                             March 31,
                                                      2001             2000
 
     Net sales                                    $ 217,360         $ 203,939
 
     Operating costs and expenses:
      Cost of sales                                 164,566           151,586
      Selling, general and administrative            21,966            18,397
      Research and development                        1,480             3,638
      Amortization of goodwill                        1,342             1,343
         Total operating costs and expenses         189,354           174,964
 
     Operating income                                28,006            28,975
     Other income (expense), net                        175               (15)
     Interest expense                                (2,022)           (2,388)
     Interest income                                    158               392
 
     Income before income taxes                      26,317            26,964
     Provision for income taxes                      (9,738)          (10,237)
 
     Net income                                   $  16,579         $  16,727
 
     Net income per share:
      Basic                                       $    0.32         $    0.33
      Assuming dilution  (a)                      $    0.32         $    0.32
 
     Weighted average shares outstanding:
      Basic                                          51,315            50,935
      Assuming dilution  (a)                         52,028            52,500
 
     (a) Calculation of net income per
          share, assuming dilution:
           Net income (basic)                     $  16,579         $  16,727
           Convertible debt add-back *                   --                --
                Numerator (assuming
                 dilution)                        $  16,579         $  16,727
 
           Weighted average shares (basic)           51,315            50,935
           Dilutive effect of:
             Stock options                              713             1,565
             Convertible debt *                          --                --
                Denominator (assuming
                 dilution)                           52,028            52,500
 
           * On December 15, 1999, the Company issued $172.5 million in
             convertible notes, which are convertible into shares of common
             stock at a conversion rate of 20.7512 shares per $1,000 principal
             amount.  The effect of the assumed conversion of these notes was
             excluded from the calculation of net income per share, assuming
             dilution, for the three months ended March 31, 2001 and 2000
             because it would have been antidilutive in both periods.
 
 
 
                         CommScope, Inc.
              Condensed Consolidated Balance Sheets
               (In thousands, except share amounts)
 
                                               (Unaudited)
                                                March 31,     December 31,
                                                  2001            2000
                              Assets
 
     Cash and cash equivalents                $   7,045       $   7,704
     Accounts receivable, less allowance
      for doubtful accounts of
      $11,062 and $9,187, respectively          181,589         197,536
     Inventories                                 61,956          63,763
     Prepaid expenses and other current
      assets                                      2,506           3,364
     Deferred income taxes                       17,608          17,296
           Total current assets                 270,704         289,663
 
     Property, plant and equipment, net         263,744         251,356
     Goodwill, net of accumulated
      amortization of $55,469 and $54,140,
      respectively                              155,328         156,685
     Other intangibles, net of accumulated
      amortization of $35,452 and $34,796,
      respectively                               13,313          13,969
     Other assets                                 9,501           9,509
 
           Total Assets                       $ 712,590       $ 721,182
 
 
         Liabilities and Stockholders' Equity
 
     Accounts payable                         $  35,947       $  39,958
     Other accrued liabilities                   47,626          38,481
     Current portion of long-term debt            2,634           2,120
           Total current liabilities             86,207          80,559
 
     Long-term debt, less current portion       193,836         225,316
     Deferred income taxes                       24,317          24,006
     Other noncurrent liabilities                17,765          16,781
           Total Liabilities                    322,125         346,662
 
     Commitments and contingencies
 
     Stockholders' Equity:
       Preferred stock, $.01 par value;
        Authorized shares:  20,000,000;
        Issued and outstanding shares:
        None at March 31, 2001 and
        December 31, 2000                            --              --
       Common stock, $.01 par value;
        Authorized shares:  300,000,000;
        Issued and outstanding shares:
        51,370,195 at March 31, 2001;
        51,263,703 at December 31, 2000             514             513
       Additional paid-in capital               177,449         175,803
       Retained earnings                        217,381         200,802
       Accumulated other comprehensive loss      (4,879)         (2,598)
           Total Stockholders' Equity           390,465         374,520
 
           Total Liabilities and
            Stockholders' Equity              $ 712,590       $ 721,182
 
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X61464078
 
 

SOURCE CommScope, Inc.
    HICKORY, N.C., April 24 /PRNewswire Interactive News Release/ --
     CommScope, Inc. (NYSE:   CTV), a world leader in the manufacture of
 broadband and high-performance communication cables, today announced first
 quarter sales and earnings per share for the period ended March 31, 2001.
 Diluted earnings per share were $0.32 in this year's first quarter compared to
 $0.32 per diluted share in the first quarter of 2000.  Earnings for the
 current quarter include charges of approximately $0.01 per share related to
 previously announced layoffs.
     Sales for the first quarter increased 7% to $217.4 million, compared to
 $203.9 million in the first quarter of 2000.   This performance was primarily
 driven by sales of broadband cable for Hybrid Fiber Coax (HFC) applications.
 Domestic sales rose to $155.7 million, up approximately 1% from the first
 quarter of 2000.  International sales rose to $61.7 million for the current
 quarter, up approximately 23% year over year.
     Orders booked in the first quarter were $186.4 million, down 31% from the
 first quarter of 2000 and down 9% sequentially.  Orders reflect a significant
 slowdown in both domestic and international markets.
     Chairman and Chief Executive Officer Frank M. Drendel said, "Challenging
 economic conditions continue to affect worldwide capital spending for
 communications networks.  Until we see clear signs of a recovery, we intend to
 closely manage cost and continue reviewing our capacity plans."
     Net income for the current quarter was $16.6 million, compared to
 $16.7 million in the first quarter of 2000.
 
     Other First-Quarter Highlights
     * Broadband/Video sales worldwide increased 15% year over year to
       approximately $170.1 million for the current quarter led by strong sales
       of fiber optic cable.  Domestic Broadband/Video sales rose approximately
       11% year over year.  International sales were $61.7 million, up 23% year
       over year and essentially equal to fourth quarter 2000 levels.  Sales
       were particularly strong to the Latin American market.
 
     "The long-term potential of the Latin American market was a key reason we
 decided to open a facility in Brazil for wired and wireless cable products,"
 noted Drendel.
 
     * Local Area Network (LAN) sales were $24.1 million in the current quarter
       compared to $24.8 million in the same period last year.  LAN sales rose
       64% sequentially.
 
     "During the fourth quarter of 2000, we laid a solid foundation for the
 improvement in our LAN business," said Drendel.  "In addition, we believe the
 stronger strategic partnership with the Siemon Company has improved our
 ability to provide world-class network cabling infrastructure solutions to
 customers across the United States."
 
     * Wireless and Other Telecom sales were $23.2 million in the current
       quarter, compared to approximately $31.5 million in the same period last
       year.  Sales of Other Telecom products declined due primarily to lower
       capital spending for telephone central office applications and
       increasing competitive pressures.  Sales of Wireless products weakened
       due primarily to the slowdown in domestic wireless infrastructure
       spending.  However, wireless order trends improved significantly during
       March.
     * Total Company gross margin for the first quarter was approximately
       24.3%, down approximately 1.4 percentage points from the first quarter
       of 2000 and down approximately 3.2 percentage points sequentially.  The
       sequential decline in gross margin resulted primarily from lower sales
       volumes and shifting product mix.  Operating margin was approximately
       12.9%.
     * In response to market conditions, the Company took steps to align its
       work force with customer demand and eliminated approximately
       500 permanent positions or about 13% of its workforce during the first
       quarter.
 
     Outlook
     As a result of challenging market conditions and continued softness in
 demand, the Company expects that its second quarter revenue will range from
 flat to down 10% sequentially.
     "We do not have good visibility regarding our performance for the
 remainder of 2001," said Drendel.  "However, over the longer term we believe
 that our superior portfolio of products, strong cash flow and excellent
 balance sheet will help us emerge from the current downturn strongly
 positioned to participate in the construction of communications networks
 around the world."
 
     Conference Call Information
     The Company plans to hold a telephonic conference call to discuss first
 quarter results today at 5:00 p.m. Eastern Time.  To participate in the
 conference call, all participants should dial 212-896-6091.  Please plan to
 dial in about 10 minutes before the start of the call to facilitate a timely
 connection.  The live, listen-only audio of the conference call will also be
 available at http://www.videonewswire.com/COMMSCOPE/042401/.
     If you are unable to participate in the call and would like to hear a
 telephonic replay, you may dial 800-633-8284.  International callers should
 dial 858-812-6440 for the replay.  The replay ID is 18440382.  The replay will
 be available through Thursday, April 26, 2001.  A webcast replay will also be
 archived for a limited period of time following the conference call via the
 Internet on CommScope's web site (http://www.commscope.com).
     CommScope is the world's largest manufacturer of broadband coaxial cable
 for Hybrid Fiber Coax (HFC) applications and is a leading supplier of high-
 performance fiber optic and twisted pair cables for LAN, wireless and other
 communications applications.
     This press release contains forward-looking statements regarding first-
 quarter earnings and outlook that are based on information currently available
 to management, management's beliefs and a number of assumptions concerning
 future events.  Forward-looking statements are not a guarantee of performance
 and are subject to a number of uncertainties and other factors, which could
 cause the actual results to differ materially from those currently expected.
 The potential risks and uncertainties that could cause actual results to
 differ materially include, but are not limited to, the ability of the company
 to implement cost reductions in a timely manner and the success of those
 actions, worldwide economic conditions, telecommunications industry capital
 spending, expected demand from AT&T and others, excess capacity, changes in
 cost and availability of key raw materials, successful implementation of the
 bimetals operation and other vertical integration activities, pricing and
 acceptance of CommScope's products, successful expansion and related operation
 of our facilities, effective implementation of our integrated information
 system, developments in technology, industry competition, ability of our
 customers to secure adequate financing, regulatory changes affecting our
 industries and other factors.  For a more detailed description of factors that
 could cause such a difference, please see CommScope's filings with the
 Securities and Exchange Commission.  In providing forward-looking statements,
 the Company does not intend, and is not undertaking any duty or obligation, to
 update these statements as a result of new information, future events or
 otherwise.
 
 
     CONTACTS:
     Phil Armstrong            Betsy Lambert, APR
     Investor Relations        Media Relations
     (828) 323-4848            (828) 323-4873
 
 
                                 CommScope, Inc.
                    Condensed Consolidated Statements of Income
          (Unaudited--in thousands, except net income per share amounts)
 
 
                                                        Three Months Ended
                                                             March 31,
                                                      2001             2000
 
     Net sales                                    $ 217,360         $ 203,939
 
     Operating costs and expenses:
      Cost of sales                                 164,566           151,586
      Selling, general and administrative            21,966            18,397
      Research and development                        1,480             3,638
      Amortization of goodwill                        1,342             1,343
         Total operating costs and expenses         189,354           174,964
 
     Operating income                                28,006            28,975
     Other income (expense), net                        175               (15)
     Interest expense                                (2,022)           (2,388)
     Interest income                                    158               392
 
     Income before income taxes                      26,317            26,964
     Provision for income taxes                      (9,738)          (10,237)
 
     Net income                                   $  16,579         $  16,727
 
     Net income per share:
      Basic                                       $    0.32         $    0.33
      Assuming dilution  (a)                      $    0.32         $    0.32
 
     Weighted average shares outstanding:
      Basic                                          51,315            50,935
      Assuming dilution  (a)                         52,028            52,500
 
     (a) Calculation of net income per
          share, assuming dilution:
           Net income (basic)                     $  16,579         $  16,727
           Convertible debt add-back *                   --                --
                Numerator (assuming
                 dilution)                        $  16,579         $  16,727
 
           Weighted average shares (basic)           51,315            50,935
           Dilutive effect of:
             Stock options                              713             1,565
             Convertible debt *                          --                --
                Denominator (assuming
                 dilution)                           52,028            52,500
 
           * On December 15, 1999, the Company issued $172.5 million in
             convertible notes, which are convertible into shares of common
             stock at a conversion rate of 20.7512 shares per $1,000 principal
             amount.  The effect of the assumed conversion of these notes was
             excluded from the calculation of net income per share, assuming
             dilution, for the three months ended March 31, 2001 and 2000
             because it would have been antidilutive in both periods.
 
 
 
                         CommScope, Inc.
              Condensed Consolidated Balance Sheets
               (In thousands, except share amounts)
 
                                               (Unaudited)
                                                March 31,     December 31,
                                                  2001            2000
                              Assets
 
     Cash and cash equivalents                $   7,045       $   7,704
     Accounts receivable, less allowance
      for doubtful accounts of
      $11,062 and $9,187, respectively          181,589         197,536
     Inventories                                 61,956          63,763
     Prepaid expenses and other current
      assets                                      2,506           3,364
     Deferred income taxes                       17,608          17,296
           Total current assets                 270,704         289,663
 
     Property, plant and equipment, net         263,744         251,356
     Goodwill, net of accumulated
      amortization of $55,469 and $54,140,
      respectively                              155,328         156,685
     Other intangibles, net of accumulated
      amortization of $35,452 and $34,796,
      respectively                               13,313          13,969
     Other assets                                 9,501           9,509
 
           Total Assets                       $ 712,590       $ 721,182
 
 
         Liabilities and Stockholders' Equity
 
     Accounts payable                         $  35,947       $  39,958
     Other accrued liabilities                   47,626          38,481
     Current portion of long-term debt            2,634           2,120
           Total current liabilities             86,207          80,559
 
     Long-term debt, less current portion       193,836         225,316
     Deferred income taxes                       24,317          24,006
     Other noncurrent liabilities                17,765          16,781
           Total Liabilities                    322,125         346,662
 
     Commitments and contingencies
 
     Stockholders' Equity:
       Preferred stock, $.01 par value;
        Authorized shares:  20,000,000;
        Issued and outstanding shares:
        None at March 31, 2001 and
        December 31, 2000                            --              --
       Common stock, $.01 par value;
        Authorized shares:  300,000,000;
        Issued and outstanding shares:
        51,370,195 at March 31, 2001;
        51,263,703 at December 31, 2000             514             513
       Additional paid-in capital               177,449         175,803
       Retained earnings                        217,381         200,802
       Accumulated other comprehensive loss      (4,879)         (2,598)
           Total Stockholders' Equity           390,465         374,520
 
           Total Liabilities and
            Stockholders' Equity              $ 712,590       $ 721,182
 
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X61464078
 
 SOURCE  CommScope, Inc.