PCTEL Meets Q1 Revenue Forecasts

Some Hope Seen for CPE Side of Communications Sector



Apr 23, 2001, 01:00 ET from PCTEL, Inc.

    MILPITAS, Calif., April 23 /PRNewswire Interactive News Release/ --
 PCTEL, Inc. (Nasdaq:   PCTI), a leading provider of personal connectivity and
 Internet access technology, today announced revenues for its first fiscal
 quarter of the year 2001.  For the first quarter ended March 31, 2001, PCTEL
 reported revenues of $16.5 million.  Adjusted net loss before non-cash items
 and restructuring charges was $1.2 million, or $0.06 per share.
     "Revenues for the first quarter were nearly equal to last quarter's
 in spite of the normal seasonal downturn from Q4 to Q1, and continuing weak PC
 demand," stated Bill Roach, president and chief executive officer of PCTEL.
 "Although we believe it will be a challenging year, with little visibility
 past the second quarter, we have some hope for the CPE or client premises
 equipment side of the communications sector.  The head end, or central office
 portion of the sector has seen tremendous growth, but now the CPE side is
 positioned to populate the ports enabled by the head end infrastructure build
 out which occurred over the last two years," Bill continued.
 
     Financial Results
     Revenues were $16.5 million for the first quarter 2001, compared with
 revenues of $24.1 million for the same period in 2000.
     Pro-forma net loss increased from $0.6 million in the fourth quarter 2000,
 to $1.2 million in the first quarter 2001, or $0.06 per share.  The increased
 loss was due to the decision to strengthen the company's balance sheet by
 increasing reserves in the area of receivables and inventory by an additional
 $1 million.
     "Devices incorporating Internet access, such as set-top boxes, game
 consoles and other connected appliances are seeing accelerated demand, and
 PCTEL is beginning to garner significant Solsis(TM) embedded design wins in
 these emerging connectivity markets beyond the PC," stated Bill Roach.  "The
 two Solsis set-top box wins we announced in the first quarter, Polytrax in
 Germany, and SAGEM in France, as well as the volume production of the
 Sun-Denshi OnLineStation for the popular Sony PlayStation(R) 2 are evidence of
 this growing success."
     "With strong modem market presence and an advanced product like Solsis,
 PCTEL is well positioned to become a driving force in the embedded Internet
 appliances industry," stated Will Strauss, president of Forward Concepts, a
 leading industry analyst research firm.
     The company continues to improve and reorganize its management team and
 organization going forward in order to stay competitive in today's challenging
 environment.  The company instituted a restructuring program comprised of a
 force reduction, a hiring freeze and operating expense controls.  The
 restructuring included a total force reduction of 35 positions, made up of
 employees, open requisitions and contractors.
 
     CONFERENCE CALL/WEBCAST
     The company will hold a conference call at 2:00 p.m. PDT (5:00 p.m. EDT)
 today with Bill Roach, president and CEO, and Andrew Wahl, vice president of
 finance, Chief Financial Officer.  The session will include brief remarks, and
 can be accessed by calling 800-847-8137 (domestic) or 212-676-5274
 (International).
     To listen via the Internet, please visit, www.pctel.com, or
 http://www.videonewswire.com/PCTEL//042301 .
 
     REPLAY:  Playback of the conference call will begin at 5:00 p.m. (PDT) on
 Monday, April 23rd, and will end at 5:00 p.m. (PDT) on Tuesday, April 24th.
 The replay will be available on PCTEL's web site at www.pctel.com or by
 calling 800-633-8284 (domestic) or 858-812-6440 (International);
 access code:  18552768.
 
     ABOUT PCTEL
     PCTEL, founded in March 1994, is driving the evolution of innovative,
 cost-effective personal connectivity solutions including analog soft modems,
 digital broadband, home networking, high-density carrier-side and embedded
 Internet access technology.  The company is a market leader and has led to a
 wide-ranging and comprehensive portfolio of more than 43 broadband and analog
 communications patents, including the key and essential patents for HSP modem
 technology.  PCTEL products are available to PC and data communications
 equipment manufacturers, as well as a variety of vertical market OEMs.  PCTEL
 is located at 1331 California Circle, Milpitas, California, 95035.  Telephone:
 408-965-2100.  Fax:  408-895-0178.  For more information on PCTEL products,
 visit the PCTEL website at http://www.pctel.com .
 
     Safe Harbor Statement
     This press release contains "forward-looking statements" within the
 meaning of Section 27A of the Securities Exchange Act of 1934, as amended.
 These forward-looking statements are subject to significant risks and
 uncertainties.  In particular, the statements concerning the client premises
 equipment side of the communications sector, demand for devices incorporating
 Internet access, the ability of PCTEL to achieve design wins in emerging
 connectivity markets beyond the personal computer market, and the ability of
 PCTEL to be a driving force in the embedded Internet appliances industry are
 forward-looking statements.  Actual results may differ materially from those
 projected as a result of certain risks and uncertainties.  These risks and
 uncertainties include, but are not limited to:  the recent economic slowdown,
 the rapid deterioration in PC demand, and our ability to forecast customer
 demand in this environment; the cyclical nature of the semiconductor and
 PC industries; demand for and market acceptance of new alternative Internet
 access devices, set-top boxes, game consoles and other connected appliances;
 the ability to develop and implement new technologies and to obtain protection
 for the related intellectual property.  Operating and financial results can be
 affected by market conditions resulting in revenues deviating from projections
 which may result in increased operating expenses, additions to reserve
 positions, lower gross margins, higher working capital ratios.  Our litigation
 expenses are dependent on a number of factors not all of which are within the
 company's control.  These as well as other risks and uncertainties, including
 but not limited to those detailed from time to time in the company's
 Securities and Exchange Commission filings can affect results.  These
 forward-looking statements are made only as of the date hereof, and the
 company disclaims any obligation to update or revise the information contained
 in any forward-looking statements, whether as a result of new information,
 future events or otherwise.
     NOTE:  PCTEL, the PCTEL logo and Solsis are trademarks of PCTEL, Inc.  All
 other company and product names are trademarks of their respective holders.
 
                                  PCTEL, Inc.
                  Pro-forma Net Income (Loss)/EPS Calculation
                  (in thousands, except per share information)
 
                                                          Three Months Ended
                                                               March 31,
                                                         2001           2000
                                                             (Unaudited)
 
     NET INCOME (LOSS)                               $(2,896)         $1,728
 
     PRO-FORMA ADJUSTMENTS:
      Acquired in-process research and development         --          1,600
      Deferred compensation                               293            349
      Amortization of goodwill and other intangible
       Assets                                           1,487            775
      Restructuring charges                               524             --
      Tax effect of adjustments                         (634)          (749)
 
     PRO-FORMA NET INCOME (LOSS)                     $(1,226)         $3,703
 
     Shares used in computing diluted earnings
      per share                                        18,973         20,288
     Pro-forma diluted earnings (loss) per share      $(0.06)          $0.18
 
 
                                  PCTEL, Inc.
                Consolidated Condensed Statements of Operations
                  (in thousands, except per share information)
 
                                                        Three Months Ended
                                                              March 31,
                                                         2001           2000
                                                            (Unaudited)
 
     REVENUES                                         $16,451        $24,121
     COST OF REVENUES                                  11,333         12,768
     GROSS PROFIT                                       5,118         11,353
     OPERATING EXPENSES:
      Research and development                          3,468          3,408
      Sales and marketing                               3,476          2,995
      General and administrative                        2,167          1,765
      Acquired in-process research and development         --          1,600
      Amortization of goodwill and other intangible
       Assets                                             946            234
      Restructuring charges                               524             --
      Amortization of deferred compensation               293            349
       Total operating expenses                        10,874         10,351
     INCOME (LOSS) FROM OPERATIONS                    (5,756)          1,002
     OTHER INCOME, NET:
      Interest income, net                              1,762          1,381
     INCOME (LOSS) BEFORE PROVISION FOR
     INCOME TAXES                                     (3,994)          2,383
     PROVISION (BENEFIT) FOR INCOME TAXES             (1,098)            655
     NET INCOME (LOSS)                               $(2,896)         $1,728
 
     Basic earnings (loss) per share                  $(0.15)          $0.10
     Shares used in computing basic earnings
      per share                                        18,973         16,805
 
     Diluted earnings (loss) per share                $(0.15)          $0.09
     Shares used in computing diluted earnings
      per share                                        18,973         20,288
 
                                  PCTEL, Inc.
                     Consolidated Condensed Balance Sheets
                                 (in thousands)
 
                                                     March 31,       Dec. 31,
                                                       2001           2000
                                                   (Unaudited)
                                       ASSET
     CURRENT ASSETS:
      Cash and cash equivalents                       $52,681        $25,397
      Short-term investments                           68,758         92,983
      Accounts receivable, net                         17,345         24,112
      Inventories, net                                  7,905         13,837
      Prepaid expenses and other assets                 3,942          4,369
 
      Deferred tax asset                                3,322          3,322
       Total current assets                           153,953        164,020
     PROPERTY AND EQUIPMENT, net                        4,548          4,722
     GOODWILL AND OTHER INTANGIBLE
     ASSETS, net                                       20,322         21,662
     DEFERRED TAX ASSET                                 2,333          2,333
     OTHER ASSETS                                         223            219
     TOTAL ASSETS                                    $181,379       $192,956
 
                        LIABILITIES AND STOCKHOLDERS' EQUITY
 
     CURRENT LIABILITIES:
      Accounts payable                                 $1,930         $9,142
      Accrued royalties                                11,230         11,656
      Income taxes payable                              4,029          3,417
      Accrued liabilities                               5,199          8,894
       Total current liabilities                       22,388         33,109
 
     STOCKHOLDERS' EQUITY:
      Common stock                                         19             19
      Additional paid-in capital                      147,438        146,461
      Deferred compensation                           (2,222)        (2,894)
      Retained earnings                                13,091         15,987
      Accumulated other comprehensive income              665            274
       Total stockholders' equity                     158,991        159,847
 
     TOTAL LIABILITIES AND STOCKHOLDERS'
     EQUITY                                          $181,379       $192,956
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X45145816
 
 

SOURCE PCTEL, Inc.
    MILPITAS, Calif., April 23 /PRNewswire Interactive News Release/ --
 PCTEL, Inc. (Nasdaq:   PCTI), a leading provider of personal connectivity and
 Internet access technology, today announced revenues for its first fiscal
 quarter of the year 2001.  For the first quarter ended March 31, 2001, PCTEL
 reported revenues of $16.5 million.  Adjusted net loss before non-cash items
 and restructuring charges was $1.2 million, or $0.06 per share.
     "Revenues for the first quarter were nearly equal to last quarter's
 in spite of the normal seasonal downturn from Q4 to Q1, and continuing weak PC
 demand," stated Bill Roach, president and chief executive officer of PCTEL.
 "Although we believe it will be a challenging year, with little visibility
 past the second quarter, we have some hope for the CPE or client premises
 equipment side of the communications sector.  The head end, or central office
 portion of the sector has seen tremendous growth, but now the CPE side is
 positioned to populate the ports enabled by the head end infrastructure build
 out which occurred over the last two years," Bill continued.
 
     Financial Results
     Revenues were $16.5 million for the first quarter 2001, compared with
 revenues of $24.1 million for the same period in 2000.
     Pro-forma net loss increased from $0.6 million in the fourth quarter 2000,
 to $1.2 million in the first quarter 2001, or $0.06 per share.  The increased
 loss was due to the decision to strengthen the company's balance sheet by
 increasing reserves in the area of receivables and inventory by an additional
 $1 million.
     "Devices incorporating Internet access, such as set-top boxes, game
 consoles and other connected appliances are seeing accelerated demand, and
 PCTEL is beginning to garner significant Solsis(TM) embedded design wins in
 these emerging connectivity markets beyond the PC," stated Bill Roach.  "The
 two Solsis set-top box wins we announced in the first quarter, Polytrax in
 Germany, and SAGEM in France, as well as the volume production of the
 Sun-Denshi OnLineStation for the popular Sony PlayStation(R) 2 are evidence of
 this growing success."
     "With strong modem market presence and an advanced product like Solsis,
 PCTEL is well positioned to become a driving force in the embedded Internet
 appliances industry," stated Will Strauss, president of Forward Concepts, a
 leading industry analyst research firm.
     The company continues to improve and reorganize its management team and
 organization going forward in order to stay competitive in today's challenging
 environment.  The company instituted a restructuring program comprised of a
 force reduction, a hiring freeze and operating expense controls.  The
 restructuring included a total force reduction of 35 positions, made up of
 employees, open requisitions and contractors.
 
     CONFERENCE CALL/WEBCAST
     The company will hold a conference call at 2:00 p.m. PDT (5:00 p.m. EDT)
 today with Bill Roach, president and CEO, and Andrew Wahl, vice president of
 finance, Chief Financial Officer.  The session will include brief remarks, and
 can be accessed by calling 800-847-8137 (domestic) or 212-676-5274
 (International).
     To listen via the Internet, please visit, www.pctel.com, or
 http://www.videonewswire.com/PCTEL//042301 .
 
     REPLAY:  Playback of the conference call will begin at 5:00 p.m. (PDT) on
 Monday, April 23rd, and will end at 5:00 p.m. (PDT) on Tuesday, April 24th.
 The replay will be available on PCTEL's web site at www.pctel.com or by
 calling 800-633-8284 (domestic) or 858-812-6440 (International);
 access code:  18552768.
 
     ABOUT PCTEL
     PCTEL, founded in March 1994, is driving the evolution of innovative,
 cost-effective personal connectivity solutions including analog soft modems,
 digital broadband, home networking, high-density carrier-side and embedded
 Internet access technology.  The company is a market leader and has led to a
 wide-ranging and comprehensive portfolio of more than 43 broadband and analog
 communications patents, including the key and essential patents for HSP modem
 technology.  PCTEL products are available to PC and data communications
 equipment manufacturers, as well as a variety of vertical market OEMs.  PCTEL
 is located at 1331 California Circle, Milpitas, California, 95035.  Telephone:
 408-965-2100.  Fax:  408-895-0178.  For more information on PCTEL products,
 visit the PCTEL website at http://www.pctel.com .
 
     Safe Harbor Statement
     This press release contains "forward-looking statements" within the
 meaning of Section 27A of the Securities Exchange Act of 1934, as amended.
 These forward-looking statements are subject to significant risks and
 uncertainties.  In particular, the statements concerning the client premises
 equipment side of the communications sector, demand for devices incorporating
 Internet access, the ability of PCTEL to achieve design wins in emerging
 connectivity markets beyond the personal computer market, and the ability of
 PCTEL to be a driving force in the embedded Internet appliances industry are
 forward-looking statements.  Actual results may differ materially from those
 projected as a result of certain risks and uncertainties.  These risks and
 uncertainties include, but are not limited to:  the recent economic slowdown,
 the rapid deterioration in PC demand, and our ability to forecast customer
 demand in this environment; the cyclical nature of the semiconductor and
 PC industries; demand for and market acceptance of new alternative Internet
 access devices, set-top boxes, game consoles and other connected appliances;
 the ability to develop and implement new technologies and to obtain protection
 for the related intellectual property.  Operating and financial results can be
 affected by market conditions resulting in revenues deviating from projections
 which may result in increased operating expenses, additions to reserve
 positions, lower gross margins, higher working capital ratios.  Our litigation
 expenses are dependent on a number of factors not all of which are within the
 company's control.  These as well as other risks and uncertainties, including
 but not limited to those detailed from time to time in the company's
 Securities and Exchange Commission filings can affect results.  These
 forward-looking statements are made only as of the date hereof, and the
 company disclaims any obligation to update or revise the information contained
 in any forward-looking statements, whether as a result of new information,
 future events or otherwise.
     NOTE:  PCTEL, the PCTEL logo and Solsis are trademarks of PCTEL, Inc.  All
 other company and product names are trademarks of their respective holders.
 
                                  PCTEL, Inc.
                  Pro-forma Net Income (Loss)/EPS Calculation
                  (in thousands, except per share information)
 
                                                          Three Months Ended
                                                               March 31,
                                                         2001           2000
                                                             (Unaudited)
 
     NET INCOME (LOSS)                               $(2,896)         $1,728
 
     PRO-FORMA ADJUSTMENTS:
      Acquired in-process research and development         --          1,600
      Deferred compensation                               293            349
      Amortization of goodwill and other intangible
       Assets                                           1,487            775
      Restructuring charges                               524             --
      Tax effect of adjustments                         (634)          (749)
 
     PRO-FORMA NET INCOME (LOSS)                     $(1,226)         $3,703
 
     Shares used in computing diluted earnings
      per share                                        18,973         20,288
     Pro-forma diluted earnings (loss) per share      $(0.06)          $0.18
 
 
                                  PCTEL, Inc.
                Consolidated Condensed Statements of Operations
                  (in thousands, except per share information)
 
                                                        Three Months Ended
                                                              March 31,
                                                         2001           2000
                                                            (Unaudited)
 
     REVENUES                                         $16,451        $24,121
     COST OF REVENUES                                  11,333         12,768
     GROSS PROFIT                                       5,118         11,353
     OPERATING EXPENSES:
      Research and development                          3,468          3,408
      Sales and marketing                               3,476          2,995
      General and administrative                        2,167          1,765
      Acquired in-process research and development         --          1,600
      Amortization of goodwill and other intangible
       Assets                                             946            234
      Restructuring charges                               524             --
      Amortization of deferred compensation               293            349
       Total operating expenses                        10,874         10,351
     INCOME (LOSS) FROM OPERATIONS                    (5,756)          1,002
     OTHER INCOME, NET:
      Interest income, net                              1,762          1,381
     INCOME (LOSS) BEFORE PROVISION FOR
     INCOME TAXES                                     (3,994)          2,383
     PROVISION (BENEFIT) FOR INCOME TAXES             (1,098)            655
     NET INCOME (LOSS)                               $(2,896)         $1,728
 
     Basic earnings (loss) per share                  $(0.15)          $0.10
     Shares used in computing basic earnings
      per share                                        18,973         16,805
 
     Diluted earnings (loss) per share                $(0.15)          $0.09
     Shares used in computing diluted earnings
      per share                                        18,973         20,288
 
                                  PCTEL, Inc.
                     Consolidated Condensed Balance Sheets
                                 (in thousands)
 
                                                     March 31,       Dec. 31,
                                                       2001           2000
                                                   (Unaudited)
                                       ASSET
     CURRENT ASSETS:
      Cash and cash equivalents                       $52,681        $25,397
      Short-term investments                           68,758         92,983
      Accounts receivable, net                         17,345         24,112
      Inventories, net                                  7,905         13,837
      Prepaid expenses and other assets                 3,942          4,369
 
      Deferred tax asset                                3,322          3,322
       Total current assets                           153,953        164,020
     PROPERTY AND EQUIPMENT, net                        4,548          4,722
     GOODWILL AND OTHER INTANGIBLE
     ASSETS, net                                       20,322         21,662
     DEFERRED TAX ASSET                                 2,333          2,333
     OTHER ASSETS                                         223            219
     TOTAL ASSETS                                    $181,379       $192,956
 
                        LIABILITIES AND STOCKHOLDERS' EQUITY
 
     CURRENT LIABILITIES:
      Accounts payable                                 $1,930         $9,142
      Accrued royalties                                11,230         11,656
      Income taxes payable                              4,029          3,417
      Accrued liabilities                               5,199          8,894
       Total current liabilities                       22,388         33,109
 
     STOCKHOLDERS' EQUITY:
      Common stock                                         19             19
      Additional paid-in capital                      147,438        146,461
      Deferred compensation                           (2,222)        (2,894)
      Retained earnings                                13,091         15,987
      Accumulated other comprehensive income              665            274
       Total stockholders' equity                     158,991        159,847
 
     TOTAL LIABILITIES AND STOCKHOLDERS'
     EQUITY                                          $181,379       $192,956
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X45145816
 
 SOURCE  PCTEL, Inc.