Bangkok--6 Sep--Core & Peak
Q2 Revenues of $231.4M, at upper end of Intermec’s guidance
EPS from Continuing Operations of $0.18, significantly exceeds guidance of $0.07 to $0.11
Cash Equivalents and Short-Term Investments increase to historic high of $322.8M
Intermec and Symbol reach landmark resolution to settle intellectual property (IP) disputes
Intermec, Inc. (NYSE: IN) today announced financial results for its second fiscal quarter of 2006.
Intermec reported 2006 second quarter revenues of $231.4 million and net earnings from continuing operations of $11.3 million, or $0.18 per diluted share, compared to 2005 second quarter revenues of $217.5 million and earnings of $11.9 million, or $0.19 per diluted share.
The results for the current quarter include a pre-tax gain of $2.3 million, or $0.02 per share, from the gain on investment in Savi Technology, whose sale to Lockheed Martin was completed in June of 2006. The 2006 second quarter also includes a restructuring charge relating to the planned closure of the Company’s design centers in Goteborg and Lund, Sweden, which negatively impacted operating profit by ($1.1) million, or ($0.01) per share. The Company’s 2006 second quarter includes ($1.0) million of incremental stock compensation expense recorded under the provisions of FAS 123(R), which negatively impacted EPS by ($0.01) per share.
The effective tax rate for the current-quarter was 37 percent, compared to 32 percent in the prior-year quarter.
Second quarter 2006 revenue increased 6.4 percent compared to the prior-year quarter. Geographically, North American revenues increased 8 percent over the comparable prior-year period. Revenues in Europe, Mid-East and Africa (EMEA) increased 3 percent; and the rest of the world, consisting of Asia Pacific and Latin America, increased 9 percent.
By product line during the second quarter, Systems and Solutions revenue increased 9 percent and Printer and Media revenues decreased 3 percent over the comparable prior-year period. Service revenue increased 7 percent over the comparable prior-year period.
“We’re encouraged by the revenue and earnings per share results Intermec delivered during its second quarter,” said Larry D. Brady, Chairman and CEO. “Contributing to the quarter’s positive outcome was our ability to leverage our productivity improvement programs while still supporting strategic future growth opportunities in R&D.”
Other Business Highlights
Symbol Technologies and Intermec reached a landmark resolution that settles all outstanding intellectual property (IP) disputes between the two companies. Under the settlement agreement, Intermec and Symbol have cross-licensed certain patents, have entered into four-year covenants not to sue with respect to remaining patents, and have released patent infringement damage claims that may have existed on the settlement date or may arise before the covenants expire. The specific terms of the settlement agreement are confidential.
METRO Group, one of the world’s largest retailers, has gone live with Intermec Gen 2 RFID (radio frequency identification) technology in its Cash & Carry wholesale stores throughout Germany. METRO suppliers now are able to ship tagged pallets with Gen 2 RFID technology.
Intermec introduced a full array of new products during the quarter. The PB42, a new portable printer that is lightweight, rugged with integrated Bluetoothtm capability in a compact design, offers the convenience of a personal area network (PAN) for receipt printing to frontline workers. The PD41 bar code printer, housed in a rugged metal case, makes best-in-class performance and versatility for transportation and logistics, light industrial and retail applications.
The new IP4 portable RFID reader delivers first-of-its-kind capability by combining the power of a handheld mobile computing device equipped with multiple radios (PAN, LAN and WAN) as well as a multi-protocol RFID radio that can be used worldwide. Intermec RFID also introduced a reusable, ruggedized rigid RFID tag capable of withstanding temperature extremes and hazardous exposures common in manufacturing and material handling operations.
The introduction of two new scan engines, the EL20, a standard range-plus scan engine, the second in our series of micro-electromechanical systems (“MEMS”)-based scan engines, and the EV12 linear imager engine further enhances Intermec’s breadth of scanning products and capabilities. In addition, version 2.2 of Intermec’s SmartSystems technology was released, providing intelligence and capabilities that allow communication between an Intermec system console and all Intermec devices on that system, including those in multiple and remote locations. The system automatically configures SmartSystems-enabled ADC equipment, downloads security patches and performs routine maintenance.
Frost & Sullivan awarded its 2006 Supply Chain Enabling Technology Award to Intermec, citing Intermec's dedication to developing and strengthening supply chain technologies and its special understanding of customer requirements. Intermec received special recognition for development of its Intellibeam EL10 bar code scan engine, the first in Intermec's family of ADC scan engines that use MEMS-based technology.
Intermec has attained Gold Certified Partner status in the Microsoft Partner Program, which recognizes Intermec’s expertise and impact in the technology marketplace. As a Gold Certified Partner, Intermec has demonstrated expertise with Microsoft technologies and a proven ability to meet customers’ requirements.
The Company’s cash equivalents and short-term investments position at the end of the second quarter reached a historic high of $322.8 million, an increase of $20.3 million during the second quarter. The increase in cash equivalents and short-term investments primarily resulted from cash flows from operating activities.
Intermec also reported today its GAAP basis outlook for the third quarter and full fiscal year 2006.
Third Quarter Outlook
Revenues are expected within a range of $230 million to $240 million.
Diluted EPS from continuing operations are expected within a range of $0.17 to $0.21.
Full Year 2006 Outlook
Revenues are expected within a range of $953 million to $973 million.
Diluted EPS from continuing operations are expected within a range of $0.90 to $1.00.
Intermec will hold a conference call on August 3, 2006 at 5 p.m. EDT (2 p.m. PDT). The call will be hosted by Intermec, Inc. Chairman and Chief Executive Officer, Larry D. Brady, President and COO, Steven J. Winter, Controller and Acting Chief Financial Officer, Rick B. Anderson and Director of Investor Relations, Kevin P. McCarty. The dial-in numbers for participants is 1-(888) 790-1641 (US); 1-(210) 234-0001 (International); Passcode: (“Intermec”).
The call will be broadcast on the Internet via a link from the investor’s Web page at the Intermec website at www.intermec.com/InvestorRelations .
About Intermec Inc.
Intermec Inc. (NYSE:IN) develops, manufactures and integrates technologies that identify, track and manage supply chain assets. Core technologies include RFID, mobile computing and data collection systems, bar code printers and label media. The company’s products and services are used by customers in many industries worldwide to improve the productivity, quality and responsiveness of business operations. For more information about Intermec, visit www.intermec.com or call 800-347-2636. Contact Intermec Investor Relations Director Kevin McCarty at [email protected] , 425-265-2472.
(Forward-looking Statement)
Certain forward-looking statements in this release (as defined by Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934) relate to matters that are not historical facts. They include, but are not limited to, statements about the Company's ability to continue to improve profit of its business segments, compete effectively with its current product lines, effectively complete the closure of certain facilities and redeploy related function, reduce expenses, improve efficiency, realign resources, increase product development capacity, leverage its research and development investment to drive significant future revenue, and the ability to continue operational improvement and year over year growth. Such forward-looking statements involve and are subject to certain risks and uncertainties. These include, but are not limited to, other risks and uncertainties described more fully in the Company's filings with the Securities and Exchange Commission including, but not limited to, its annual report on Form 10-K and quarterly reports on Form 10-Q.
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For more information, please contact:
Srisuput Siangyen
Core & Peak Co., Ltd
Tel.024394600
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