TESSCO Reports 32% Revenue Growth and EPS of $1.13 For The Fiscal Year Ended April 1, 2001

Revenue Growth of 7% and EPS Of $0.05 for the Fourth Quarter Ended April 1,

2001



Apr 26, 2001, 01:00 ET from TESSCO Technologies Incorporated

    HUNT VALLEY, Md., April 26 /PRNewswire/ --
 TESSCO Technologies Incorporated (Nasdaq: TESS), a leading product solution
 provider to the wireless communications industry, today reported its financial
 results for the fiscal year and fourth quarter ended April 1, 2001.
     Revenues for the twelve months ended April 1, 2001, increased 32% to
 $258.8 million compared to $196.8 million for the prior fiscal year. Gross
 profit increased 30%, totaling $70.5 million for the current year compared to
 $54.3 million in the prior fiscal year.
     Net income for the twelve months ended April 1, 2001, totaled $5.3 million
 compared to $5.5 million for the prior fiscal year. Diluted earnings per share
 for the fiscal year totaled $1.13 compared to $1.20 in the prior fiscal year.
     Cash flow provided by operations totaled $2.9 million for the fiscal year.
     Revenues for the fourth quarter increased 7% to $60.0 million compared to
 $56.3 million for the corresponding prior year quarter.  Gross profit totaled
 $16.4 million for the quarter as compared to $15.5 million in the
 corresponding prior year quarter.
     Net income for the fourth quarter totaled $220,000 compared to
 $1.4 million for the corresponding prior year quarter.  Diluted earnings per
 share for the quarter totaled $0.05 compared to $0.31 for the corresponding
 prior year quarter.
     Robert B. Barnhill, Jr., chairman and chief executive officer, said: "Less
 than ninety days ago we expected our fiscal year 2001 to be a record for
 revenues and earnings. At the end of our third quarter, year to date revenues
 and earnings per share were up 41% and 20%, respectively, over last year's
 comparable period. Then, after seven consecutive quarters of record revenues
 and gross profits, our fourth quarter performance was hindered by general
 economic conditions and a tightening of the capital markets.  As a
 consequence, we ended the year with revenue growth of 32% and a decline in
 earnings per share of 6% compared to last year.
     "The ability of wireless carriers and supporting companies to finance
 their growth plans has been greatly inhibited. Our fourth quarter sales were
 negatively impacted by the general slowdown and our unwillingness to accept
 excessive credit risk.
 
     "Let me highlight our progress compared to last year:
 
     -- Average monthly buyers increased 9% for the year and 8% for the
        quarter.
     -- Average monthly purchases per buyer increased 22% for the year but
        declined 4% for the quarter.
     -- Network infrastructure product sales increased 31% for the year but
        declined 6% for the quarter.
     -- Mobile devices and accessories sales grew 17% for the year and 23% for
        the quarter.
     -- Test and maintenance sales were up 68% for the year and 12% for the
        quarter.
     -- 14% of fourth quarter revenues were generated from sales of new
        products added within the past 12 months. This was driven not only by
        our core mobile wireless products but also by our new initiatives in
        fixed wireless broadband.
     -- TESSCO.com is building customer loyalty, satisfaction and sales while
        reducing our order entry and customer service costs.
 
     "Many of our current and potential customers are struggling now under the
 weight of excess inventories and supply chain costs.  Going forward,
 especially in this uncertain economic climate, we believe more and more of our
 customers will look to TESSCO to help them better deploy their capital to
 revenue generation projects and not inventory ownership.  The power of our
 value proposition should allow us to build market share and to continue our
 revenue growth in the face of a soft market.
     "The outlook for the next year is much less clear than it has been in the
 past, nevertheless, our goals for the new fiscal year are simple:
 
     -- Improve productivity and profitability. We have adjusted our
        investments in growth capacity and continue to eliminate non-
        productive and non-contributing resources and keep expenses under
        tight control.
     -- Improve the return on shareowner equity.
     -- Achieve our productivity, profitability and return goals regardless of
        revenue growth.
     -- Build market share:
          -- increase the number of customers buying from TESSCO on a monthly
             basis
          -- increase the product category and manufacturer cross-sell to a
             particular customer
          -- represent a larger portion of our manufacturers' total sales
 
     "We enter our new fiscal year well equipped to achieve our goals:
 
     1. Our value proposition is truly what our customers and manufacturers
        need, especially in this economic climate. We can help these companies
        reduce their inventories and operating expenses while achieving their
        revenue and performance goals.
     2. We have implemented a disciplined methodology throughout TESSCO to
        drive holistic, productive throughput and effectively manage resources,
        opportunities and projects. We expect this initiative to help us
        achieve our productivity, profitability and return on equity goals,
        especially in this tough economic environment.
     3. We have the technology and fulfillment capacity in place for an
        increased level of productive throughput.
     4. We have a strong balance sheet and access to additional working
        capital.
     5. We have a committed, talented and focused group of leaders and team
        members.
 
     "Thank you for your support in fiscal 2001 and your continued commitment
 to our vision."
 
     BUSINESS OUTLOOK
     The following statements are based on current expectations. These
 statements are forward-looking, and actual results may differ materially.
 Continuing uncertainty in economic conditions make it particularly difficult
 to forecast product demand and other related matters.  The Company's current
 estimate is that revenues for the first quarter ending July 1, 2001, should be
 in the range of $56 million to $60 million and earnings per share in the range
 of break-even to $0.05; and for fiscal year ending March 31, 2002, that
 earnings per share should be in excess of $1.00.  These estimates are
 dependent upon market conditions improving throughout the year.
     TESSCO expects that its corporate representatives will meet privately
 during the quarter with investors, the media, investment analysts and others.
 At these meetings, TESSCO may reiterate the Business Outlook published in this
 press release. At the same time, TESSCO will keep this press release and
 Business Outlook publicly available on its web site (www.TESSCO.com). However,
 the Business Outlook published in this press release reflects only the
 Company's current best estimate and the Company assumes no obligation to
 update the information contained in this press release, including the Business
 Outlook, at any time.
 
     The statements by Robert B. Barnhill, Jr. and the statements above under
 the heading Business Outlook are forward-looking statements that involve a
 number of risks and uncertainties. In addition to factors discussed above,
 other factors could cause actual results to differ materially.  Such factors
 include, but are not limited to, the following: the Company's dependence on a
 relatively small number of suppliers and vendors, which could hamper the
 Company's ability to maintain appropriate inventory levels and meet customer
 demand; the effect that the loss of certain customers or vendors could have on
 the Company's net profits; the possibility that unforeseen events could impair
 the Company's ability to service its customers promptly and efficiently, if at
 all; the possibility that, for unforeseen reasons, the Company may be delayed
 in entering into or performing, or may fail to enter into or perform,
 anticipated contracts or may otherwise be delayed in realizing or fail to
 realize anticipated revenues or anticipated savings; existing competition from
 national and regional distributors and the absence of significant barriers to
 entry which could result in pricing and other pressures on profitability and
 market share; and continuing changes in the wireless communications industry,
 including risks associated with conflicting technologies, changes in
 technologies, inventory obsolescence and evolving Internet business models and
 the resulting competition. Consequently, the reader is cautioned to consider
 all forward-looking statements in light of the risks to which they are
 subject.
 
     ABOUT TESSCO
     TESSCO Technologies Incorporated is a leading provider of the services,
 products and solutions required to build, operate, maintain and use wireless
 voice, data, messaging, tracking and Internet systems.  The Company provides
 marketing and sales services, knowledge and supply chain management, product-
 solution delivery and control systems utilizing extensive Internet and
 information technology.
     TESSCO's guiding vision is to be the Vital Link between buyers and
 manufacturers.  For its customers, TESSCO provides a total source of product
 choices and availability, optimized logistics and reduced total procurement
 costs.  For its manufacturers, TESSCO provides a cost-effective communication,
 marketing, sales and distribution channel.  The TESSCO mission is to virtually
 link knowledge and delivery of the right product, in the right configuration,
 at the right time, to the point of use.
     TESSCO's operations are centralized in the Global Logistics Center, the
 Company's ISO 9002 registered headquarters in Hunt Valley, Maryland.  All
 customer, manufacturer, product, configuration, sales and delivery activities
 are directed by an integrated enterprise information technology platform.
 Fulfillment centers in Hunt Valley, Maryland and Reno, Nevada, configure
 orders for complete, on-time delivery throughout the world. Its product
 offerings consist of over 25,000 items from over 380 manufacturers.  The
 Company currently serves more than 8,500 business customers and 17,000
 consumers per month, including a diversified mix of cellular and PCS
 telephone, Wireless ISP and paging carriers, fixed wireless and mobile radio-
 dispatch operators, integrators, contractors and dealers, and self-maintained
 users.
 
 
     TESSCO Technologies Incorporated
     Consolidated Balance Sheets
 
                                                   April 1,       March 26,
                                                     2001            2000
                                                   (audited)      (audited)
     ASSETS
 
     CURRENT ASSETS:
      Cash and marketable securities                       $-       $818,100
      Trade accounts receivable, net               25,557,800     28,177,400
      Product inventory                            32,566,400     31,723,800
      Deferred tax asset                            1,531,600      1,199,700
      Prepaid expenses and other current assets     2,689,600      1,843,100
      Total current assets                         62,345,400     63,762,100
 
     PROPERTY AND EQUIPMENT, net                   21,640,400     17,160,900
     GOODWILL, net                                  3,002,400      3,291,200
     OTHER LONG-TERM ASSETS                           425,300        228,900
 
         Total assets                             $87,413,500    $84,443,100
 
 
     LIABILITIES AND SHAREHOLDERS' EQUITY
 
     CURRENT LIABILITIES:
       Trade accounts payable                     $16,744,600    $25,353,800
       Accrued expenses and
        other current liabilities                   4,639,000      3,981,300
       Revolving line of credit                    10,011,000      5,862,000
       Current portion of long-term debt              354,500        332,900
           Total current liabilities               31,749,100     35,530,000
 
     DEFERRED TAX LIABILITY                         2,095,800        806,200
     LONG-TERM DEBT, net of current portion         6,441,200      6,795,800
     OTHER LONG-TERM LIABILITIES                      438,900        228,900
           Total liabilities                       40,725,000     43,360,900
 
     COMMITMENTS AND CONTINGENCIES
 
     SHAREHOLDERS' EQUITY:
       Preferred stock                                      -              -
       Common stock                                    48,000         47,700
       Additional paid-in capital                  21,697,600     21,283,600
       Treasury stock, at cost                    (3,792,600)    (3,710,600)
       Retained earnings                           28,735,500     23,461,500
          Total shareholders' equity               46,688,500     41,082,200
          Total liabilities and
           shareholders' equity                   $87,413,500    $84,443,100
 
 
 
     TESSCO Technologies Incorporated
     Consolidated Statements of Income
 
                          Fiscal Quarters Ended       Twelve Months Ended
                          April 1,     March 26,      April 1,    March 26,
                            2001          2000          2001        2000
                        (unaudited)   (unaudited)    (audited)    (audited)
 
     Revenues           $59,988,000   $56,253,300 $258,769,800  $196,830,300
     Cost of goods sold  43,628,600    40,767,600  188,271,200   142,523,000
 
     Gross profit        16,359,400    15,485,700   70,498,600    54,307,300
 
     Selling, general and
      administrative
      expenses           15,447,200    12,711,300   59,953,000    44,027,400
 
     Income from operations 912,200     2,774,400   10,545,600    10,279,900
 
     Interest expense, net  556,900       445,000    2,039,100     1,340,300
 
     Income before
      provision for
      income taxes          355,300     2,329,400    8,506,500     8,939,600
 
     Provision for
      income taxes          135,000       885,200    3,232,500     3,397,000
 
     Net income            $220,300    $1,444,200   $5,274,000    $5,542,600
 
 
     Basic earnings
      per share               $0.05         $0.32        $1.17         $1.24
 
     Diluted earnings
      per share               $0.05         $0.31        $1.13         $1.20
 
     Basic weighted average
      shares outstanding  4,499,100     4,491,000    4,494,800     4,472,500
 
     Diluted weighted average
      shares outstanding  4,579,200     4,640,100    4,682,600     4,599,500
 
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SOURCE TESSCO Technologies Incorporated
    HUNT VALLEY, Md., April 26 /PRNewswire/ --
 TESSCO Technologies Incorporated (Nasdaq: TESS), a leading product solution
 provider to the wireless communications industry, today reported its financial
 results for the fiscal year and fourth quarter ended April 1, 2001.
     Revenues for the twelve months ended April 1, 2001, increased 32% to
 $258.8 million compared to $196.8 million for the prior fiscal year. Gross
 profit increased 30%, totaling $70.5 million for the current year compared to
 $54.3 million in the prior fiscal year.
     Net income for the twelve months ended April 1, 2001, totaled $5.3 million
 compared to $5.5 million for the prior fiscal year. Diluted earnings per share
 for the fiscal year totaled $1.13 compared to $1.20 in the prior fiscal year.
     Cash flow provided by operations totaled $2.9 million for the fiscal year.
     Revenues for the fourth quarter increased 7% to $60.0 million compared to
 $56.3 million for the corresponding prior year quarter.  Gross profit totaled
 $16.4 million for the quarter as compared to $15.5 million in the
 corresponding prior year quarter.
     Net income for the fourth quarter totaled $220,000 compared to
 $1.4 million for the corresponding prior year quarter.  Diluted earnings per
 share for the quarter totaled $0.05 compared to $0.31 for the corresponding
 prior year quarter.
     Robert B. Barnhill, Jr., chairman and chief executive officer, said: "Less
 than ninety days ago we expected our fiscal year 2001 to be a record for
 revenues and earnings. At the end of our third quarter, year to date revenues
 and earnings per share were up 41% and 20%, respectively, over last year's
 comparable period. Then, after seven consecutive quarters of record revenues
 and gross profits, our fourth quarter performance was hindered by general
 economic conditions and a tightening of the capital markets.  As a
 consequence, we ended the year with revenue growth of 32% and a decline in
 earnings per share of 6% compared to last year.
     "The ability of wireless carriers and supporting companies to finance
 their growth plans has been greatly inhibited. Our fourth quarter sales were
 negatively impacted by the general slowdown and our unwillingness to accept
 excessive credit risk.
 
     "Let me highlight our progress compared to last year:
 
     -- Average monthly buyers increased 9% for the year and 8% for the
        quarter.
     -- Average monthly purchases per buyer increased 22% for the year but
        declined 4% for the quarter.
     -- Network infrastructure product sales increased 31% for the year but
        declined 6% for the quarter.
     -- Mobile devices and accessories sales grew 17% for the year and 23% for
        the quarter.
     -- Test and maintenance sales were up 68% for the year and 12% for the
        quarter.
     -- 14% of fourth quarter revenues were generated from sales of new
        products added within the past 12 months. This was driven not only by
        our core mobile wireless products but also by our new initiatives in
        fixed wireless broadband.
     -- TESSCO.com is building customer loyalty, satisfaction and sales while
        reducing our order entry and customer service costs.
 
     "Many of our current and potential customers are struggling now under the
 weight of excess inventories and supply chain costs.  Going forward,
 especially in this uncertain economic climate, we believe more and more of our
 customers will look to TESSCO to help them better deploy their capital to
 revenue generation projects and not inventory ownership.  The power of our
 value proposition should allow us to build market share and to continue our
 revenue growth in the face of a soft market.
     "The outlook for the next year is much less clear than it has been in the
 past, nevertheless, our goals for the new fiscal year are simple:
 
     -- Improve productivity and profitability. We have adjusted our
        investments in growth capacity and continue to eliminate non-
        productive and non-contributing resources and keep expenses under
        tight control.
     -- Improve the return on shareowner equity.
     -- Achieve our productivity, profitability and return goals regardless of
        revenue growth.
     -- Build market share:
          -- increase the number of customers buying from TESSCO on a monthly
             basis
          -- increase the product category and manufacturer cross-sell to a
             particular customer
          -- represent a larger portion of our manufacturers' total sales
 
     "We enter our new fiscal year well equipped to achieve our goals:
 
     1. Our value proposition is truly what our customers and manufacturers
        need, especially in this economic climate. We can help these companies
        reduce their inventories and operating expenses while achieving their
        revenue and performance goals.
     2. We have implemented a disciplined methodology throughout TESSCO to
        drive holistic, productive throughput and effectively manage resources,
        opportunities and projects. We expect this initiative to help us
        achieve our productivity, profitability and return on equity goals,
        especially in this tough economic environment.
     3. We have the technology and fulfillment capacity in place for an
        increased level of productive throughput.
     4. We have a strong balance sheet and access to additional working
        capital.
     5. We have a committed, talented and focused group of leaders and team
        members.
 
     "Thank you for your support in fiscal 2001 and your continued commitment
 to our vision."
 
     BUSINESS OUTLOOK
     The following statements are based on current expectations. These
 statements are forward-looking, and actual results may differ materially.
 Continuing uncertainty in economic conditions make it particularly difficult
 to forecast product demand and other related matters.  The Company's current
 estimate is that revenues for the first quarter ending July 1, 2001, should be
 in the range of $56 million to $60 million and earnings per share in the range
 of break-even to $0.05; and for fiscal year ending March 31, 2002, that
 earnings per share should be in excess of $1.00.  These estimates are
 dependent upon market conditions improving throughout the year.
     TESSCO expects that its corporate representatives will meet privately
 during the quarter with investors, the media, investment analysts and others.
 At these meetings, TESSCO may reiterate the Business Outlook published in this
 press release. At the same time, TESSCO will keep this press release and
 Business Outlook publicly available on its web site (www.TESSCO.com). However,
 the Business Outlook published in this press release reflects only the
 Company's current best estimate and the Company assumes no obligation to
 update the information contained in this press release, including the Business
 Outlook, at any time.
 
     The statements by Robert B. Barnhill, Jr. and the statements above under
 the heading Business Outlook are forward-looking statements that involve a
 number of risks and uncertainties. In addition to factors discussed above,
 other factors could cause actual results to differ materially.  Such factors
 include, but are not limited to, the following: the Company's dependence on a
 relatively small number of suppliers and vendors, which could hamper the
 Company's ability to maintain appropriate inventory levels and meet customer
 demand; the effect that the loss of certain customers or vendors could have on
 the Company's net profits; the possibility that unforeseen events could impair
 the Company's ability to service its customers promptly and efficiently, if at
 all; the possibility that, for unforeseen reasons, the Company may be delayed
 in entering into or performing, or may fail to enter into or perform,
 anticipated contracts or may otherwise be delayed in realizing or fail to
 realize anticipated revenues or anticipated savings; existing competition from
 national and regional distributors and the absence of significant barriers to
 entry which could result in pricing and other pressures on profitability and
 market share; and continuing changes in the wireless communications industry,
 including risks associated with conflicting technologies, changes in
 technologies, inventory obsolescence and evolving Internet business models and
 the resulting competition. Consequently, the reader is cautioned to consider
 all forward-looking statements in light of the risks to which they are
 subject.
 
     ABOUT TESSCO
     TESSCO Technologies Incorporated is a leading provider of the services,
 products and solutions required to build, operate, maintain and use wireless
 voice, data, messaging, tracking and Internet systems.  The Company provides
 marketing and sales services, knowledge and supply chain management, product-
 solution delivery and control systems utilizing extensive Internet and
 information technology.
     TESSCO's guiding vision is to be the Vital Link between buyers and
 manufacturers.  For its customers, TESSCO provides a total source of product
 choices and availability, optimized logistics and reduced total procurement
 costs.  For its manufacturers, TESSCO provides a cost-effective communication,
 marketing, sales and distribution channel.  The TESSCO mission is to virtually
 link knowledge and delivery of the right product, in the right configuration,
 at the right time, to the point of use.
     TESSCO's operations are centralized in the Global Logistics Center, the
 Company's ISO 9002 registered headquarters in Hunt Valley, Maryland.  All
 customer, manufacturer, product, configuration, sales and delivery activities
 are directed by an integrated enterprise information technology platform.
 Fulfillment centers in Hunt Valley, Maryland and Reno, Nevada, configure
 orders for complete, on-time delivery throughout the world. Its product
 offerings consist of over 25,000 items from over 380 manufacturers.  The
 Company currently serves more than 8,500 business customers and 17,000
 consumers per month, including a diversified mix of cellular and PCS
 telephone, Wireless ISP and paging carriers, fixed wireless and mobile radio-
 dispatch operators, integrators, contractors and dealers, and self-maintained
 users.
 
 
     TESSCO Technologies Incorporated
     Consolidated Balance Sheets
 
                                                   April 1,       March 26,
                                                     2001            2000
                                                   (audited)      (audited)
     ASSETS
 
     CURRENT ASSETS:
      Cash and marketable securities                       $-       $818,100
      Trade accounts receivable, net               25,557,800     28,177,400
      Product inventory                            32,566,400     31,723,800
      Deferred tax asset                            1,531,600      1,199,700
      Prepaid expenses and other current assets     2,689,600      1,843,100
      Total current assets                         62,345,400     63,762,100
 
     PROPERTY AND EQUIPMENT, net                   21,640,400     17,160,900
     GOODWILL, net                                  3,002,400      3,291,200
     OTHER LONG-TERM ASSETS                           425,300        228,900
 
         Total assets                             $87,413,500    $84,443,100
 
 
     LIABILITIES AND SHAREHOLDERS' EQUITY
 
     CURRENT LIABILITIES:
       Trade accounts payable                     $16,744,600    $25,353,800
       Accrued expenses and
        other current liabilities                   4,639,000      3,981,300
       Revolving line of credit                    10,011,000      5,862,000
       Current portion of long-term debt              354,500        332,900
           Total current liabilities               31,749,100     35,530,000
 
     DEFERRED TAX LIABILITY                         2,095,800        806,200
     LONG-TERM DEBT, net of current portion         6,441,200      6,795,800
     OTHER LONG-TERM LIABILITIES                      438,900        228,900
           Total liabilities                       40,725,000     43,360,900
 
     COMMITMENTS AND CONTINGENCIES
 
     SHAREHOLDERS' EQUITY:
       Preferred stock                                      -              -
       Common stock                                    48,000         47,700
       Additional paid-in capital                  21,697,600     21,283,600
       Treasury stock, at cost                    (3,792,600)    (3,710,600)
       Retained earnings                           28,735,500     23,461,500
          Total shareholders' equity               46,688,500     41,082,200
          Total liabilities and
           shareholders' equity                   $87,413,500    $84,443,100
 
 
 
     TESSCO Technologies Incorporated
     Consolidated Statements of Income
 
                          Fiscal Quarters Ended       Twelve Months Ended
                          April 1,     March 26,      April 1,    March 26,
                            2001          2000          2001        2000
                        (unaudited)   (unaudited)    (audited)    (audited)
 
     Revenues           $59,988,000   $56,253,300 $258,769,800  $196,830,300
     Cost of goods sold  43,628,600    40,767,600  188,271,200   142,523,000
 
     Gross profit        16,359,400    15,485,700   70,498,600    54,307,300
 
     Selling, general and
      administrative
      expenses           15,447,200    12,711,300   59,953,000    44,027,400
 
     Income from operations 912,200     2,774,400   10,545,600    10,279,900
 
     Interest expense, net  556,900       445,000    2,039,100     1,340,300
 
     Income before
      provision for
      income taxes          355,300     2,329,400    8,506,500     8,939,600
 
     Provision for
      income taxes          135,000       885,200    3,232,500     3,397,000
 
     Net income            $220,300    $1,444,200   $5,274,000    $5,542,600
 
 
     Basic earnings
      per share               $0.05         $0.32        $1.17         $1.24
 
     Diluted earnings
      per share               $0.05         $0.31        $1.13         $1.20
 
     Basic weighted average
      shares outstanding  4,499,100     4,491,000    4,494,800     4,472,500
 
     Diluted weighted average
      shares outstanding  4,579,200     4,640,100    4,682,600     4,599,500
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X64472128
 
 SOURCE  TESSCO Technologies Incorporated