Zebra Technologies Reports Financial Results for First Quarter of 2001; Company Provides Forecast for 2001 Second Quarter and Full Year

Apr 24, 2001, 01:00 ET from Zebra Technologies Corporation

    VERNON HILLS, Ill., April 24 /PRNewswire Interactive News Release/ --
 Zebra Technologies Corporation (Nasdaq:   ZBRA) today announced that financial
 results for the first quarter of 2001 exceeded management's forecast and
 analyst expectations.
     For the three months ended March 31, 2001, net sales were $115,144,000, up
 15.6% from $99,635,000 for the corresponding period in 2000.  Quarterly
 diluted earnings excluding merger costs were $0.57 per share, up 14.0% from
 $0.50 per share for the first quarter of 2000.  Including merger costs, first
 quarter diluted earnings advanced 14.6% to $0.55 per share from $0.48 per
 share.  First quarter net income totaled $16,930,000 in 2001, up 11.2% from
 $15,228,000 for the first quarter of 2000.  Free cash flow for the first
 quarter of 2001 reached a record $22,045,000, and EBITDA totaled $29,359,000.
     "We are extremely pleased with Zebra's performance during this challenging
 economic period," stated Edward Kaplan, Zebra's chairman and chief executive
 officer.  "The contribution from mobile printing systems, as well as continued
 growth in instant-issuance plastic card printers and our Latin America and
 Asia Pacific regions drove quarterly sales growth.  Gross profit margin was in
 line with expectations, and we controlled the growth in operating expenses
 consistent with sales growth to deliver a healthy operating profit margin of
 22.2% prior to merger costs.  Lower receivables and inventories led to our
 record free cash flow generation.  Overall, Zebra's first quarter results
 demonstrate the resiliency of our business in slower economic times and the
 opportunity for accelerating growth as business conditions improve."
     In addition to first quarter financial results, the company announced its
 financial forecast for the 2001 second quarter and full year.  For the second
 quarter, net sales are expected within a range of $120 million and
 $124 million, with earnings between $0.58 and $0.63 per share.  For 2001,
 Zebra expects earnings of $2.60 to $2.75 per share on sales of $500 million to
 $515 million.
     Mr. Kaplan stated, "While signs of a rebound may be emerging, it appears
 that current economic conditions will be more prolonged than previously
 anticipated.  For this reason, we are making a modest 5% revision to our
 annual sales and earnings forecast."
     Forward-looking statements contained in this release are subject to the
 safe harbor created by the Private Securities Reform Act of 1995 and are
 highly dependent upon a variety of important factors which could cause actual
 results to differ materially from those reflected in such forward looking
 statements. These factors include market acceptance of the company's products
 and competitors' product offerings.  They also include the success and speed
 of the company's integration with Comtec Information Systems, which the
 company acquired in April 2000.  Profits will be affected by the company's
 ability to control manufacturing and operating costs.  Because of the
 company's large investment portfolio, interest rate and financial market
 conditions will also have an impact on results.  Foreign exchange rates will
 have an effect on financial results because of the large percentage of the
 company's international sales. Economic conditions, particularly those in the
 United States and North America, will affect the company's ability to meet
 sales and earnings expectations.  When used in this release and documents
 referenced, the words "anticipate," "believe," "estimate," and "expect" and
 similar expressions as they relate to the company or its management are
 intended to identify such forward-looking statements. The company refers
 readers of this release to prior filings with the Securities and Exchange
 Commission, including Zebra's Form 10-K for the year ended December 31, 2000
 for further discussions of issues that could affect the company's future
 results.
     Zebra Technologies Corporation manufactures and distributes Zebra-brand
 on-demand thermal bar code label printers and Eltron(R)-brand instant-issuance
 plastic card printers used in automatic identification, personalization and
 security applications worldwide.  The company, with an installed base of two
 million printers, also offers software and related supplies, including more
 than 1,000 label and ribbon combinations.  Zebra's customers include more than
 70 percent of the FORTUNE 500. Information about Zebra Technologies
 Corporation can be found at www.zebracorporation.com .
 
                         ZEBRA TECHNOLOGIES CORPORATION
                          CONSOLIDATED BALANCE SHEETS
            (Amounts in thousands, except share and per share data)
 
                                                     March 31,    December 31,
                                                       2001           2000
                       ASSETS                       (Unaudited)
     Current assets:
       Cash and cash equivalents                      $35,329        $24,815
       Investments and marketable securities          145,644        131,899
       Accounts receivable, net                        76,573         83,941
       Inventories                                     55,947         56,852
       Deferred income taxes                            4,786          4,601
       Prepaid expenses                                 1,970          1,578
         Total current assets                         320,249        303,686
     Property and equipment at cost, less
      accumulated depreciation and amortization        41,008         41,587
     Long-term deferred income taxes                    3,759          3,469
     Excess of cost over fair value of net assets
      acquired                                         34,080         34,529
     Other intangibles                                 28,446         29,281
     Other assets                                       7,443          6,344
         Total assets                                $434,985       $418,896
 
             LIABILITIES AND SHAREHOLDERS' EQUITY
       Current liabilities:
       Accounts payable                               $18,405        $23,838
       Accrued liabilities                             12,210         11,910
       Short-term note payable                            196            149
       Current portion of obligation under capital
        lease with related party                          102             77
       Income taxes payable                            14,338         10,913
         Total current liabilities                     45,251         46,887
 
     Obligation under capital lease, less current
      portion                                             319            513
     Other                                                293            208
         Total liabilities                             45,863         47,608
 
     Shareholders' equity:
     Preferred stock, $.01 par value; 10,000,000
      shares authorized, none outstanding                  --             --
     Class A Common Stock, $.01 par value;
      50,000,000 shares authorized, 25,628,966 and
      25,610,515 shares issued; 24,657,572 and
      24,551,762 shares outstanding in 2001 and
      2000, respectively                                  256            256
     Class B Common Stock, $.01 par value;
      28,358,189 shares authorized, 5,917,550 and
      5,936,001 shares issued and outstanding in
      2001 and 2000, respectively                          59             59
     Additional paid-in capital                        61,679         63,491
     Treasury stock
      (971,394 shares and 1,058,753 shares in 2001
      and 2000, respectively)                         (46,039)       (50,128)
     Retained earnings                                377,956        361,026
     Accumulated other comprehensive income            (4,789)        (3,416)
         Total shareholders' equity                   389,122        371,288
         Total liabilities and shareholders' equity  $434,985       $418,896
 
 
                         ZEBRA TECHNOLOGIES CORPORATION
                      CONSOLIDATED STATEMENTS OF EARNINGS
                 (Amounts in thousands, except per share data)
                                  (Unaudited)
 
                                                       Three Months Ended
                                                     March 31,      April 1,
                                                       2001           2000
 
     Net sales                                       $115,144        $99,635
     Cost of sales                                     61,122         50,255
     Gross profit                                      54,022         49,380
     Operating expenses:
       Selling and marketing                           12,074         10,613
       Research and development                         6,596          5,748
       General and administrative                       8,554          7,734
       Amortization of intangible assets                1,283             67
       Merger costs                                       832          1,009
     Total operating expenses                          29,339         25,171
 
     Operating income                                  24,683         24,209
 
     Other income (expense):
       Investment income                                2,162          3,215
       Interest expense                                   (11)           (18)
       Other, net                                        (380)        (3,612)
     Total other income (expense)                       1,771           (415)
 
     Income before income taxes                        26,454         23,794
     Income taxes                                       9,524          8,566
     Net income                                       $16,930        $15,228
 
     Basic earnings per share                           $0.55          $0.48
     Diluted earnings per share                         $0.55          $0.48
 
     Basic weighted average shares outstanding         30,541         31,462
     Diluted weighted average and equivalent shares
      outstanding                                      30,790         31,956
 
 
                         ZEBRA TECHNOLOGIES CORPORATION
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (Amounts in thousands)
                                  (Unaudited)
 
                                                        Three Months Ended
                                                     March 31,      April 1,
                                                       2001           2000
 
     Cash flows from operating activities:
       Net income                                     $16,930        $15,228
       Adjustments to reconcile net income to net
        cash provided by operating activities:
         Depreciation and amortization                  3,844          2,527
         Appreciation in market value of
          investments & marketable securities            (296)        (1,553)
         Deferred income taxes                           (475)           601
         Changes in assets and liabilities:
           Accounts receivable, net                     7,368          3,667
           Inventories                                    905         (4,803)
           Other assets                                (1,098)           810
           Accounts payable                            (5,433)        (3,117)
           Accrued expenses                               300         (5,044)
           Income taxes payable                         3,425          3,209
           Other operating activities                    (365)           (53)
           Investments and marketable securities      (13,397)        35,000
             Net cash provided by operating
              activities                               11,708         46,472
 
     Cash flows from investing activities:
       Purchases of property and equipment             (1,982)        (2,577)
         Net cash used in investing activities         (1,982)        (2,577)
 
     Cash flows from financing activities:
       Proceeds from exercise of stock options          2,277          3,095
       Issuance (repayment) of notes payable              105         49,973
       Payments for obligation under capital lease       (169)          (169)
         Net cash provided by financing activities      2,213         52,899
 
     Effect of exchange rate changes on cash           (1,425)          (437)
 
     Net increase in cash and cash equivalents         10,514         96,357
     Cash and cash equivalents at beginning of period  24,815         38,501
     Cash and cash equivalents at end of period       $35,329       $134,858
 
     Supplemental disclosures of cash flow information:
       Interest paid                                      $92            $18
       Income taxes paid                                6,001          5,251
 
 
                         ZEBRA TECHNOLOGIES CORPORATION
                         SUPPLEMENTAL SALES INFORMATION
                             (Amounts in thousands)
                                  (Unaudited)
 
                             Sales by Product Category
 
                             Three Months Ended
                           March 31,      April 1,       Percent    Percent of
                             2001           2000          Change   Total Sales
 
     Hardware               $88,314       $78,664         12.3          76.7
     Supplies                20,798        18,033         15.3          18.1
     Service and software     4,749         1,923        147.0           4.1
     Freight revenue          1,283         1,015         26.4           1.1
     Total sales           $115,144       $99,635         15.6         100.0
 
                             Sales by Geographic Region
 
                             Three Months Ended
                           March 31,      April 1,       Percent    Percent of
                             2001           2000          Change   Total Sales
 
     International          $44,159       $44,339         (0.4)         38.4
     North America           70,985        55,296         28.4          61.6
     Total sales           $115,144       $99,635         15.6         100.0
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X54917445
 
 

SOURCE Zebra Technologies Corporation
    VERNON HILLS, Ill., April 24 /PRNewswire Interactive News Release/ --
 Zebra Technologies Corporation (Nasdaq:   ZBRA) today announced that financial
 results for the first quarter of 2001 exceeded management's forecast and
 analyst expectations.
     For the three months ended March 31, 2001, net sales were $115,144,000, up
 15.6% from $99,635,000 for the corresponding period in 2000.  Quarterly
 diluted earnings excluding merger costs were $0.57 per share, up 14.0% from
 $0.50 per share for the first quarter of 2000.  Including merger costs, first
 quarter diluted earnings advanced 14.6% to $0.55 per share from $0.48 per
 share.  First quarter net income totaled $16,930,000 in 2001, up 11.2% from
 $15,228,000 for the first quarter of 2000.  Free cash flow for the first
 quarter of 2001 reached a record $22,045,000, and EBITDA totaled $29,359,000.
     "We are extremely pleased with Zebra's performance during this challenging
 economic period," stated Edward Kaplan, Zebra's chairman and chief executive
 officer.  "The contribution from mobile printing systems, as well as continued
 growth in instant-issuance plastic card printers and our Latin America and
 Asia Pacific regions drove quarterly sales growth.  Gross profit margin was in
 line with expectations, and we controlled the growth in operating expenses
 consistent with sales growth to deliver a healthy operating profit margin of
 22.2% prior to merger costs.  Lower receivables and inventories led to our
 record free cash flow generation.  Overall, Zebra's first quarter results
 demonstrate the resiliency of our business in slower economic times and the
 opportunity for accelerating growth as business conditions improve."
     In addition to first quarter financial results, the company announced its
 financial forecast for the 2001 second quarter and full year.  For the second
 quarter, net sales are expected within a range of $120 million and
 $124 million, with earnings between $0.58 and $0.63 per share.  For 2001,
 Zebra expects earnings of $2.60 to $2.75 per share on sales of $500 million to
 $515 million.
     Mr. Kaplan stated, "While signs of a rebound may be emerging, it appears
 that current economic conditions will be more prolonged than previously
 anticipated.  For this reason, we are making a modest 5% revision to our
 annual sales and earnings forecast."
     Forward-looking statements contained in this release are subject to the
 safe harbor created by the Private Securities Reform Act of 1995 and are
 highly dependent upon a variety of important factors which could cause actual
 results to differ materially from those reflected in such forward looking
 statements. These factors include market acceptance of the company's products
 and competitors' product offerings.  They also include the success and speed
 of the company's integration with Comtec Information Systems, which the
 company acquired in April 2000.  Profits will be affected by the company's
 ability to control manufacturing and operating costs.  Because of the
 company's large investment portfolio, interest rate and financial market
 conditions will also have an impact on results.  Foreign exchange rates will
 have an effect on financial results because of the large percentage of the
 company's international sales. Economic conditions, particularly those in the
 United States and North America, will affect the company's ability to meet
 sales and earnings expectations.  When used in this release and documents
 referenced, the words "anticipate," "believe," "estimate," and "expect" and
 similar expressions as they relate to the company or its management are
 intended to identify such forward-looking statements. The company refers
 readers of this release to prior filings with the Securities and Exchange
 Commission, including Zebra's Form 10-K for the year ended December 31, 2000
 for further discussions of issues that could affect the company's future
 results.
     Zebra Technologies Corporation manufactures and distributes Zebra-brand
 on-demand thermal bar code label printers and Eltron(R)-brand instant-issuance
 plastic card printers used in automatic identification, personalization and
 security applications worldwide.  The company, with an installed base of two
 million printers, also offers software and related supplies, including more
 than 1,000 label and ribbon combinations.  Zebra's customers include more than
 70 percent of the FORTUNE 500. Information about Zebra Technologies
 Corporation can be found at www.zebracorporation.com .
 
                         ZEBRA TECHNOLOGIES CORPORATION
                          CONSOLIDATED BALANCE SHEETS
            (Amounts in thousands, except share and per share data)
 
                                                     March 31,    December 31,
                                                       2001           2000
                       ASSETS                       (Unaudited)
     Current assets:
       Cash and cash equivalents                      $35,329        $24,815
       Investments and marketable securities          145,644        131,899
       Accounts receivable, net                        76,573         83,941
       Inventories                                     55,947         56,852
       Deferred income taxes                            4,786          4,601
       Prepaid expenses                                 1,970          1,578
         Total current assets                         320,249        303,686
     Property and equipment at cost, less
      accumulated depreciation and amortization        41,008         41,587
     Long-term deferred income taxes                    3,759          3,469
     Excess of cost over fair value of net assets
      acquired                                         34,080         34,529
     Other intangibles                                 28,446         29,281
     Other assets                                       7,443          6,344
         Total assets                                $434,985       $418,896
 
             LIABILITIES AND SHAREHOLDERS' EQUITY
       Current liabilities:
       Accounts payable                               $18,405        $23,838
       Accrued liabilities                             12,210         11,910
       Short-term note payable                            196            149
       Current portion of obligation under capital
        lease with related party                          102             77
       Income taxes payable                            14,338         10,913
         Total current liabilities                     45,251         46,887
 
     Obligation under capital lease, less current
      portion                                             319            513
     Other                                                293            208
         Total liabilities                             45,863         47,608
 
     Shareholders' equity:
     Preferred stock, $.01 par value; 10,000,000
      shares authorized, none outstanding                  --             --
     Class A Common Stock, $.01 par value;
      50,000,000 shares authorized, 25,628,966 and
      25,610,515 shares issued; 24,657,572 and
      24,551,762 shares outstanding in 2001 and
      2000, respectively                                  256            256
     Class B Common Stock, $.01 par value;
      28,358,189 shares authorized, 5,917,550 and
      5,936,001 shares issued and outstanding in
      2001 and 2000, respectively                          59             59
     Additional paid-in capital                        61,679         63,491
     Treasury stock
      (971,394 shares and 1,058,753 shares in 2001
      and 2000, respectively)                         (46,039)       (50,128)
     Retained earnings                                377,956        361,026
     Accumulated other comprehensive income            (4,789)        (3,416)
         Total shareholders' equity                   389,122        371,288
         Total liabilities and shareholders' equity  $434,985       $418,896
 
 
                         ZEBRA TECHNOLOGIES CORPORATION
                      CONSOLIDATED STATEMENTS OF EARNINGS
                 (Amounts in thousands, except per share data)
                                  (Unaudited)
 
                                                       Three Months Ended
                                                     March 31,      April 1,
                                                       2001           2000
 
     Net sales                                       $115,144        $99,635
     Cost of sales                                     61,122         50,255
     Gross profit                                      54,022         49,380
     Operating expenses:
       Selling and marketing                           12,074         10,613
       Research and development                         6,596          5,748
       General and administrative                       8,554          7,734
       Amortization of intangible assets                1,283             67
       Merger costs                                       832          1,009
     Total operating expenses                          29,339         25,171
 
     Operating income                                  24,683         24,209
 
     Other income (expense):
       Investment income                                2,162          3,215
       Interest expense                                   (11)           (18)
       Other, net                                        (380)        (3,612)
     Total other income (expense)                       1,771           (415)
 
     Income before income taxes                        26,454         23,794
     Income taxes                                       9,524          8,566
     Net income                                       $16,930        $15,228
 
     Basic earnings per share                           $0.55          $0.48
     Diluted earnings per share                         $0.55          $0.48
 
     Basic weighted average shares outstanding         30,541         31,462
     Diluted weighted average and equivalent shares
      outstanding                                      30,790         31,956
 
 
                         ZEBRA TECHNOLOGIES CORPORATION
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (Amounts in thousands)
                                  (Unaudited)
 
                                                        Three Months Ended
                                                     March 31,      April 1,
                                                       2001           2000
 
     Cash flows from operating activities:
       Net income                                     $16,930        $15,228
       Adjustments to reconcile net income to net
        cash provided by operating activities:
         Depreciation and amortization                  3,844          2,527
         Appreciation in market value of
          investments & marketable securities            (296)        (1,553)
         Deferred income taxes                           (475)           601
         Changes in assets and liabilities:
           Accounts receivable, net                     7,368          3,667
           Inventories                                    905         (4,803)
           Other assets                                (1,098)           810
           Accounts payable                            (5,433)        (3,117)
           Accrued expenses                               300         (5,044)
           Income taxes payable                         3,425          3,209
           Other operating activities                    (365)           (53)
           Investments and marketable securities      (13,397)        35,000
             Net cash provided by operating
              activities                               11,708         46,472
 
     Cash flows from investing activities:
       Purchases of property and equipment             (1,982)        (2,577)
         Net cash used in investing activities         (1,982)        (2,577)
 
     Cash flows from financing activities:
       Proceeds from exercise of stock options          2,277          3,095
       Issuance (repayment) of notes payable              105         49,973
       Payments for obligation under capital lease       (169)          (169)
         Net cash provided by financing activities      2,213         52,899
 
     Effect of exchange rate changes on cash           (1,425)          (437)
 
     Net increase in cash and cash equivalents         10,514         96,357
     Cash and cash equivalents at beginning of period  24,815         38,501
     Cash and cash equivalents at end of period       $35,329       $134,858
 
     Supplemental disclosures of cash flow information:
       Interest paid                                      $92            $18
       Income taxes paid                                6,001          5,251
 
 
                         ZEBRA TECHNOLOGIES CORPORATION
                         SUPPLEMENTAL SALES INFORMATION
                             (Amounts in thousands)
                                  (Unaudited)
 
                             Sales by Product Category
 
                             Three Months Ended
                           March 31,      April 1,       Percent    Percent of
                             2001           2000          Change   Total Sales
 
     Hardware               $88,314       $78,664         12.3          76.7
     Supplies                20,798        18,033         15.3          18.1
     Service and software     4,749         1,923        147.0           4.1
     Freight revenue          1,283         1,015         26.4           1.1
     Total sales           $115,144       $99,635         15.6         100.0
 
                             Sales by Geographic Region
 
                             Three Months Ended
                           March 31,      April 1,       Percent    Percent of
                             2001           2000          Change   Total Sales
 
     International          $44,159       $44,339         (0.4)         38.4
     North America           70,985        55,296         28.4          61.6
     Total sales           $115,144       $99,635         15.6         100.0
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X54917445
 
 SOURCE  Zebra Technologies Corporation