|By Business Wire||
|May 1, 2014 04:31 PM EDT||
Sierra Wireless, Inc. (NASDAQ:SWIR) (TSX:SW):
First Quarter 2014 highlights from continuing operations
- Record revenue of $121.2 million, an increase of 19.5% compared with Q1 2013
- Adjusted EBITDA of $4.1 million compared with $1.8 million in Q1 2013
- Non-GAAP earnings from operations of $0.7 million compared with a non-GAAP loss from operations of $1.4 million in Q1 2013
Sierra Wireless, Inc. (NASDAQ: SWIR) (TSX: SW) today reported results for its first quarter ending March 31, 2014. All results are reported in U.S. dollars and are prepared in accordance with United States generally accepted accounting principles (GAAP), except as otherwise indicated below.
“We achieved record revenue in the first quarter and also completed the acquisition of In Motion Technology. I believe we are well positioned for continued revenue growth and improving profitability in the second quarter and beyond,” said Jason Cohenour, President and Chief Executive Officer. “We continue to focus on driving profitable organic growth in M2M devices and cloud services, while pursuing additional strategic acquisitions.”
Revenue for the first quarter of 2014 was $121.2 million, an increase of 19.5% compared to $101.4 million in the first quarter of 2013, and an increase of 2.2% compared to $118.6 million in the fourth quarter of 2013. Revenue from OEM Solutions was $106.2 million in the first quarter of 2014, up 19.0% compared to $89.2 million in the first quarter of 2013. Revenue from Enterprise Solutions was $15.0 million (including $1.3 million contribution from In Motion Technology) in the first quarter of 2014, up 23.3% compared to $12.2 million in the first quarter of 2013.
- Gross margin was $38.6 million, or 31.9% of revenue, in the first quarter of 2014, compared to $33.4 million, or 32.9% of revenue, in the first quarter of 2013.
- Operating expenses were $45.3 million and loss from operations was $6.7 million in the first quarter of 2014, compared to operating expenses of $40.3 million and a loss from operations of $6.9 million in the first quarter of 2013.
- Net loss from continuing operations was $4.0 million, or $0.13 per diluted share, in the first quarter of 2014, compared to a net loss from continuing operations of $7.9 million, or $0.26 per diluted share, in the first quarter of 2013.
- Gross margin was 32.0% in the first quarter of 2014, compared to 33.0% in the first quarter of 2013.
- Operating expenses were $38.0 million and earnings from operations were $0.7 million in the first quarter of 2014, compared to operating expenses of $34.9 million and a loss from operations of $1.4 million in the first quarter of 2013.
- Adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA") were $4.1 million in the first quarter of 2014, compared to $1.8 million in the first quarter of 2013.
- Net earnings from continuing operations were $0.5 million, or $0.02 per diluted share, in the first quarter of 2014, compared to a net loss from continuing operations of $0.7 million, or $0.02 per diluted share, in the first quarter of 2013.
Non-GAAP results exclude the impact of stock-based compensation expense and related social taxes, acquisition costs, gain on sale of the AirCard business, restructuring costs, integration costs, disposition costs, acquisition amortization, impairment, foreign exchange gains or losses on translation of balance sheet accounts, and certain tax adjustments. We disclose non-GAAP amounts as we believe that these measures provide our shareholders with better information about actual operating results and assist in comparisons from one period to another.
Adjusted EBITDA as defined equates to earnings (loss) from operations plus stock-based compensation expense and related social taxes, acquisition costs, restructuring costs, integration costs, impairment, and amortization. The reconciliation between our GAAP and non-GAAP results is provided in the accompanying schedules.
The Company provides the following guidance for continuing operations for the second quarter of 2014.
In the second quarter of 2014 we expect revenue to increase sequentially and on a year-over-year basis, driven by organic growth as well as the addition of revenue for a full quarter from In Motion Technology. We expect gross margin percentage to improve slightly from the first quarter of 2014 and operating expenses to increase, primarily reflecting the addition of In Motion Technology expenses for a full quarter.
|Q2 2014 Guidance||
|Revenue||$128.0 to $131.0 million|
|Earnings from operations||$2.7 to $3.5 million|
|Net earnings||$1.9 to $2.5 million|
|Earnings per share||$0.06 to $0.08 per share|
This non-GAAP guidance for the second quarter of 2014 reflects current business indicators and expectations. Inherent in this guidance are risk factors that are described in greater detail in our regulatory filings. Our actual results could differ materially from those presented above. All figures are approximations based on management's current beliefs and assumptions.
Conference call, webcast and instant replay details
Sierra Wireless President and CEO, Jason Cohenour, and CFO, David McLennan, will host a conference call and webcast with analysts and investors to review the results on Thursday, May 1, 2014, at 5:30 PM Eastern Time (2:30 PM PT). A live slide presentation will be available for viewing during the call from the link provided below.
To participate in this conference call, please dial the following number approximately ten minutes prior to the commencement of the call:
- Toll-free (Canada and US): 1-877-201-0168
- Alternate number: 1-647-788-4901
- Conference ID: 15895706
For those unable to participate in the live call, a replay will be available until June 1, 2014. Dial 1-855-859-2056 or 1-800-585-8367 and enter the Conference ID number above to access the replay.
To access the webcast, please follow the link below:
If the above link does not work, please copy and paste the following URL into your browser:
The webcast will remain available at the above link for one year following the call.
To access a full copy of our Q1 2014 earnings release, please follow the link below:
Cautionary Note Regarding Forward-Looking Statements
Certain statements and information in this press release are not based on historical facts and constitute forward-looking statements or forward-looking information within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and Canadian securities laws (“forward-looking statements”) including statements and information relating to our financial guidance for the second quarter of 2014 and our fiscal year 2014, our business outlook for the short and longer term and our strategy, plans and future operating performance. Forward-looking statements are provided to help you understand our views of our short and longer term prospects. We caution you that forward-looking statements may not be appropriate for other purposes. We will not update or revise our forward-looking statements unless we are required to do so by securities laws.
- Typically include words and phrases about the future such as “outlook”, “may”, “estimates”, “intends”, “believes”, “plans”, “anticipates” and “expects”.
- Are not promises or guarantees of future performance. They represent our current views and may change significantly.
- Are based on a number of material assumptions, including those listed below, which could prove to be significantly incorrect:
- Our ability to develop, manufacture and sell new products and services that meet the needs of our customers and gain commercial acceptance;
- Our ability to continue to sell our products and services in the expected quantities at the expected prices and expected times;
- Expected cost of goods sold;
- Expected component supply constraints;
- Our ability to “win” new business;
- Expected deployment of next generation networks by wireless network operators;
- Our operations are not adversely disrupted by component shortages or other development, operating or regulatory risks; and
- Expected tax rates and foreign exchange rates.
- Are subject to substantial known and unknown material risks and uncertainties. Many factors could cause our actual results, achievements and developments in our business to differ significantly from those expressed or implied by our forward-looking statements, including without limitation, the following factors. These risk factors and others are discussed in our Annual Information Form and Management's Discussion and Analysis of Financial Condition and Results of Operations, which may be found on SEDAR at www.sedar.com and on EDGAR at www.sec.gov and in our other regulatory filings with the Securities and Exchange Commission in the United States and the Provincial Securities Commissions in Canada.
- Actual sales volumes or prices for our products and services may be lower than we expect for any reason including, without limitation, continuing uncertain economic conditions, price and product competition, different product mix, the loss of any of our significant customers, or competition from new or established wireless communication companies;
- The cost of products sold may be higher than planned or necessary component supplies may not be available, are delayed or are not available on commercially reasonable terms;
- We may be unable to enforce our intellectual property rights or may be subject to litigation that has an adverse outcome;
- The development and timing of the introduction of our new products may be later than we expect or may be indefinitely delayed;
- Transition periods associated with the migration to new technologies may be longer than we expect;
- Unanticipated costs associated with litigation or settlements associated with intellectual property matters; and
- Higher than anticipated costs; disruption of, and demands on, our ongoing business; and diversion of management's time and attention in connection with acquisitions or divestitures.
About Sierra Wireless
Sierra Wireless (NASDAQ: SWIR) (TSX: SW) is the global leader in machine-to-machine (M2M) devices and cloud services, delivering intelligent wireless solutions that simplify the connected world. We offer the industry's most comprehensive portfolio of 2G, 3G and 4G embedded modules and gateways, seamlessly integrated with our secure M2M cloud services. Customers worldwide, including OEMs, enterprises, and mobile network operators, trust our innovative solutions to get their connected products and services to market faster. Sierra Wireless has more than 900 employees globally and has R&D centers in North America, Europe and Asia. For more information about Sierra Wireless, visit www.sierrawireless.com.
"AirPrime," "AirLink," and "AirVantage" are trademarks of Sierra Wireless. Other product or service names mentioned herein may be the trademarks of their respective owners.
SIERRA WIRELESS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(In thousands of U.S. dollars, except where otherwise stated)
|Three months ended March 31,|
|Cost of goods sold||82,566||68,023|
|Sales and marketing||12,366||10,356|
|Research and development||20,017||18,363|
|Loss from operations||(6,672||)||(6,884||)|
|Foreign exchange gain (loss)||392||(2,370||)|
|Other income (expense)||26||(132||)|
|Loss before income taxes||(6,254||)||(9,386||)|
|Income tax recovery||2,249||1,448|
|Net loss from continuing operations||(4,005||)||(7,938||)|
|Net earnings from discontinued operations||—||1,863|
|Other comprehensive income (loss):|
|Foreign currency translation adjustments, net of taxes of $nil||20||(904||)|
Basic and diluted net earnings (loss) per share attributable to
|Weighted average number of shares outstanding (in thousands)|
SIERRA WIRELESS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands of U.S. dollars)
|March 31, 2014||December 31, 2013|
|Cash and cash equivalents||$||151,339||$||177,416|
Accounts receivable, net of allowance for doubtful accounts of
|Deferred income taxes||2,393||2,391|
|Prepaids and other||23,965||28,741|
|Property and equipment||21,076||21,982|
|Deferred income taxes||4,208||7,176|
|Accounts payable and accrued liabilities||$||111,015||$||124,846|
|Deferred revenue and credits||4,155||2,481|
|Deferred income taxes||505||127|
Common stock: no par value; unlimited shares authorized; issued and
Preferred stock: no par value; unlimited shares authorized;
Treasury stock: at cost 81,475 shares (December 31, 2013 – 507,147 shares)
|Additional paid-in capital||21,813||25,996|
|Accumulated other comprehensive loss||(6,838||)||(6,858||)|
SIERRA WIRELESS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of U.S. dollars)
|Three months ended March 31,|
|Cash flows provided by (used in):|
Items not requiring (providing) cash
|Deferred income taxes||2,966||(31||)|
|Gain on disposal of property and equipment||(14||)||—|
|Impairment of assets related to discontinued operations||—||1,004|
|Taxes paid related to net settlement of equity awards||(501||)||(250||)|
|Changes in non-cash working capital|
|Prepaid expenses and other||5,098||(9,044||)|
|Accounts payable and accrued liabilities||(17,238||)||(3,079||)|
|Deferred revenue and credits||52||28|
|Cash flows used in operating activities||(3,895||)||(5,547||)|
|Additions to property and equipment||(1,430||)||(2,199||)|
|Proceeds from sale of property and equipment||37||11|
|Increase in intangible assets||(527||)||(659||)|
|Acquisition of In Motion Technology, net of cash acquired||(22,578||)||—|
|Net change in short-term investments||2,470||—|
|Increase in other assets||(2,748||)||—|
Cash flows used in investing activities
|Issuance of common shares||2,725||2,104|
|Repurchase of common shares for cancellation||—||(1,377||)|
|Decrease in other long-term obligations||(112||)||(627||)|
Cash flows provided by financing activities
|Effect of foreign exchange rate changes on cash and cash equivalents||(19||)||571|
|Cash and cash equivalents, decrease in the period||(26,077||)||(7,723||)|
|Cash and cash equivalents, beginning of period||177,416||63,646|
|Cash and cash equivalents, end of period||$||151,339||$||55,923|
SIERRA WIRELESS, INC.
RECONCILIATION OF GAAP AND NON-GAAP RESULTS
|(in thousands of U.S. dollars, except where otherwise stated)|
|Gross margin - GAAP||$||38,597||$||145,641||$||38,443||$||37,346||$||36,474||$||33,378|
|Stock-based compensation and related social taxes||160||406||119||117||95||75|
|Gross margin - Non-GAAP||$||38,757||$||146,047||$||38,562||$||37,463||$||36,569||$||33,453|
|Loss from operations - GAAP||$||(6,672||)||$||(17,664||)||$||(3,547||)||$||(3,301||)||$||(3,932||)||$||(6,884||)|
|Stock-based compensation and related social taxes||3,304||7,990||2,177||2,145||2,013||1,655|
|Impairment of an asset in R&D||—||280||—||—||—||280|
|Acquisition related amortization||3,118||13,741||3,580||3,405||3,363||3,393|
|Earnings (loss) from operations - Non-GAAP||$||720||$||5,053||$||2,593||$||2,402||$||1,470||$||(1,412||)|
|Amortization (excluding acquisition related amortization)||3,365||13,649||3,566||3,468||3,403||3,212|
|Net earnings (loss) from continuing operations - GAAP||$||(4,005||)||$||(15,550||)||$||(1,945||)||$||1,075||$||(6,742||)||$||(7,938||)|
Stock-based compensation and related social taxes,
|Unrealized foreign exchange loss (gain)||(382||)||(3,912||)||(1,970||)||(2,457||)||(1,359||)||1,874|
|Income tax adjustments||(2,519||)||3,784||925||(895||)||3,754||—|
|Net earnings (loss) from continuing operations - Non-GAAP||$||483||$||6,942||$||3,122||$||3,483||$||1,046||$||(709||)|
|Net earnings (loss) from discontinued operations – GAAP||$||—||$||70,588||$||1,078||$||(505||)||$||68,152||$||1,863|
|Stock-based compensation and disposition costs||—||4,014||3||1,402||876||1,733|
|Gain on sale of AirCard business||—||(70,182||)||(1,056||)||(49||)||(69,077||)||—|
|Net earnings (loss) from discontinued operations - Non-GAAP||$||—||$||4,420||$||25||$||848||$||(49||)||$||3,596|
|Net earnings (loss) - GAAP||$||(4,005||)||$||55,038||$||(867||)||$||570||$||61,410||$||(6,075||)|
|Net earnings (loss) - Non-GAAP||483||11,362||3,147||4,331||997||2,887|
|Diluted earnings (loss) from continuing operations per share|
|GAAP - (in dollars)||$||(0.13||)||$||(0.50||)||$||(0.06||)||$||0.03||$||(0.22||)||$||(0.26||)|
|Non-GAAP - (in dollars)||$||0.02||$||0.23||$||0.10||$||0.11||$||0.03||$||(0.02||)|
|Net earnings (loss) per share - diluted|
|GAAP - (in dollars)||$||(0.13||)||$||1.79||$||(0.03||)||$||0.02||$||2.00||$||(0.20||)|
|Non-GAAP - (in dollars)||$||0.02||$||0.37||$||0.10||$||0.14||$||0.03||$||0.09|
SIERRA WIRELESS, INC.
(In thousands of U.S. dollars, except where otherwise stated)
|Cost of goods sold||75,634||266,867||72,336||66,395||65,514||62,622|
|Gross margin %||28.8%||30.1%||29.0%||30.7%||31.1%||29.8%|
|Cost of goods sold||6,932||29,352||7,829||8,521||7,601||5,401|
|Gross margin %||53.8%||51.0%||53.3%||48.1%||47.6%||55.6%|
As enterprises work to take advantage of Big Data technologies, they frequently become distracted by product-level decisions. In most new Big Data builds this approach is completely counter-productive: it presupposes tools that may not be a fit for development teams, forces IT to take on the burden of evaluating and maintaining unfamiliar technology, and represents a major up-front expense. In his session at @BigDataExpo at @ThingsExpo, Andrew Warfield, CTO and Co-Founder of Coho Data, will dis...
Feb. 6, 2016 07:15 PM EST
SYS-CON Events announced today that Fusion, a leading provider of cloud services, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Fusion, a leading provider of integrated cloud solutions to small, medium and large businesses, is the industry's single source for the cloud. Fusion's advanced, proprietary cloud service platform enables the integration of leading edge solutions in the cloud, including clou...
Feb. 6, 2016 03:30 PM EST Reads: 703
With the Apple Watch making its way onto wrists all over the world, it’s only a matter of time before it becomes a staple in the workplace. In fact, Forrester reported that 68 percent of technology and business decision-makers characterize wearables as a top priority for 2015. Recognizing their business value early on, FinancialForce.com was the first to bring ERP to wearables, helping streamline communication across front and back office functions. In his session at @ThingsExpo, Kevin Roberts...
Feb. 6, 2016 03:15 PM EST Reads: 322
SYS-CON Events announced today that Commvault, a global leader in enterprise data protection and information management, has been named “Bronze Sponsor” of SYS-CON's 18th International Cloud Expo, which will take place on June 7–9, 2016, at the Javits Center in New York City, NY, and the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Commvault is a leading provider of data protection and information management...
Feb. 6, 2016 02:30 PM EST Reads: 349
SYS-CON Events announced today that Alert Logic, Inc., the leading provider of Security-as-a-Service solutions for the cloud, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Alert Logic, Inc., provides Security-as-a-Service for on-premises, cloud, and hybrid infrastructures, delivering deep security insight and continuous protection for customers at a lower cost than traditional security solutions. Ful...
Feb. 6, 2016 01:30 PM EST Reads: 338
SYS-CON Events announced today that VAI, a leading ERP software provider, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. VAI (Vormittag Associates, Inc.) is a leading independent mid-market ERP software developer renowned for its flexible solutions and ability to automate critical business functions for the distribution, manufacturing, specialty retail and service sectors. An IBM Premier Business Part...
Feb. 6, 2016 01:00 PM EST Reads: 536
With an estimated 50 billion devices connected to the Internet by 2020, several industries will begin to expand their capabilities for retaining end point data at the edge to better utilize the range of data types and sheer volume of M2M data generated by the Internet of Things. In his session at @ThingsExpo, Don DeLoach, CEO and President of Infobright, will discuss the infrastructures businesses will need to implement to handle this explosion of data by providing specific use cases for filte...
Feb. 6, 2016 11:00 AM EST
The cloud promises new levels of agility and cost-savings for Big Data, data warehousing and analytics. But it’s challenging to understand all the options – from IaaS and PaaS to newer services like HaaS (Hadoop as a Service) and BDaaS (Big Data as a Service). In her session at @BigDataExpo at @ThingsExpo, Hannah Smalltree, a director at Cazena, will provide an educational overview of emerging “as-a-service” options for Big Data in the cloud. This is critical background for IT and data profes...
Feb. 6, 2016 11:00 AM EST Reads: 112
Fortunately, meaningful and tangible business cases for IoT are plentiful in a broad array of industries and vertical markets. These range from simple warranty cost reduction for capital intensive assets, to minimizing downtime for vital business tools, to creating feedback loops improving product design, to improving and enhancing enterprise customer experiences. All of these business cases, which will be briefly explored in this session, hinge on cost effectively extracting relevant data from ...
Feb. 6, 2016 09:00 AM EST
SYS-CON Events announced today that Interoute, owner-operator of one of Europe's largest networks and a global cloud services platform, has been named “Bronze Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2015 at the Javits Center in New York, New York. Interoute is the owner-operator of one of Europe's largest networks and a global cloud services platform which encompasses 12 data centers, 14 virtual data centers and 31 colocation centers, with connections to 195 ad...
Feb. 6, 2016 05:00 AM EST Reads: 327
Most people haven’t heard the word, “gamification,” even though they probably, and perhaps unwittingly, participate in it every day. Gamification is “the process of adding games or game-like elements to something (as a task) so as to encourage participation.” Further, gamification is about bringing game mechanics – rules, constructs, processes, and methods – into the real world in an effort to engage people. In his session at @ThingsExpo, Robert Endo, owner and engagement manager of Intrepid D...
Feb. 5, 2016 09:00 PM EST Reads: 769
Eighty percent of a data scientist’s time is spent gathering and cleaning up data, and 80% of all data is unstructured and almost never analyzed. Cognitive computing, in combination with Big Data, is changing the equation by creating data reservoirs and using natural language processing to enable analysis of unstructured data sources. This is impacting every aspect of the analytics profession from how data is mined (and by whom) to how it is delivered. This is not some futuristic vision: it's ha...
Feb. 2, 2016 02:00 PM EST Reads: 401
WebRTC has had a real tough three or four years, and so have those working with it. Only a few short years ago, the development world were excited about WebRTC and proclaiming how awesome it was. You might have played with the technology a couple of years ago, only to find the extra infrastructure requirements were painful to implement and poorly documented. This probably left a bitter taste in your mouth, especially when things went wrong.
Feb. 2, 2016 04:30 AM EST Reads: 837
Learn how IoT, cloud, social networks and last but not least, humans, can be integrated into a seamless integration of cooperative organisms both cybernetic and biological. This has been enabled by recent advances in IoT device capabilities, messaging frameworks, presence and collaboration services, where devices can share information and make independent and human assisted decisions based upon social status from other entities. In his session at @ThingsExpo, Michael Heydt, founder of Seamless...
Feb. 1, 2016 05:00 AM EST Reads: 918
The IoT's basic concept of collecting data from as many sources possible to drive better decision making, create process innovation and realize additional revenue has been in use at large enterprises with deep pockets for decades. So what has changed? In his session at @ThingsExpo, Prasanna Sivaramakrishnan, Solutions Architect at Red Hat, discussed the impact commodity hardware, ubiquitous connectivity, and innovations in open source software are having on the connected universe of people, thi...
Jan. 31, 2016 09:00 PM EST Reads: 715
WebRTC: together these advances have created a perfect storm of technologies that are disrupting and transforming classic communications models and ecosystems. In his session at WebRTC Summit, Cary Bran, VP of Innovation and New Ventures at Plantronics and PLT Labs, provided an overview of this technological shift, including associated business and consumer communications impacts, and opportunities it may enable, complement or entirely transform.
Jan. 31, 2016 07:15 PM EST Reads: 1,135
There are so many tools and techniques for data analytics that even for a data scientist the choices, possible systems, and even the types of data can be daunting. In his session at @ThingsExpo, Chris Harrold, Global CTO for Big Data Solutions for EMC Corporation, showed how to perform a simple, but meaningful analysis of social sentiment data using freely available tools that take only minutes to download and install. Participants received the download information, scripts, and complete end-t...
Jan. 31, 2016 10:00 AM EST Reads: 1,194
For manufacturers, the Internet of Things (IoT) represents a jumping-off point for innovation, jobs, and revenue creation. But to adequately seize the opportunity, manufacturers must design devices that are interconnected, can continually sense their environment and process huge amounts of data. As a first step, manufacturers must embrace a new product development ecosystem in order to support these products.
Jan. 31, 2016 10:00 AM EST Reads: 796
Manufacturing connected IoT versions of traditional products requires more than multiple deep technology skills. It also requires a shift in mindset, to realize that connected, sensor-enabled “things” act more like services than what we usually think of as products. In his session at @ThingsExpo, David Friedman, CEO and co-founder of Ayla Networks, discussed how when sensors start generating detailed real-world data about products and how they’re being used, smart manufacturers can use the dat...
Jan. 30, 2016 07:45 PM EST Reads: 768
When it comes to IoT in the enterprise, namely the commercial building and hospitality markets, a benefit not getting the attention it deserves is energy efficiency, and IoT’s direct impact on a cleaner, greener environment when installed in smart buildings. Until now clean technology was offered piecemeal and led with point solutions that require significant systems integration to orchestrate and deploy. There didn't exist a 'top down' approach that can manage and monitor the way a Smart Buildi...
Jan. 30, 2016 03:45 PM EST Reads: 1,258