EX-99.1 2 a12-17626_1ex99d1.htm EX-99.1

Exhibit 99.1

 

News Release

 

Media Contact:

Investor Contact:

Sharlene Myers

David G. McLennan

Manager, Global Public Relations

Chief Financial Officer

+1 (604) 232-1445

+1 (604) 231-1181

smyers@sierrawireless.com

investor@sierrawireless.com

 

Sierra Wireless reports second quarter 2012 results

 

·                  Revenue in the second quarter 2012 of $167.4 million, 19.7 percent year-over-year growth

·                  Non-GAAP earnings from operations of $12.7 million, up from loss of $0.8 million in the second quarter of 2011

·                  Non-GAAP net earnings of $9.3 million, or $0.30 per diluted share, up from a net loss of $1.0 million, or $0.03 per diluted share in the second quarter of 2011

·                  Cash, cash equivalents and short-term investments balance of $125.3 million, up $18.5 million from the end of the first quarter 2012

 

Vancouver, Canada — August 2, 2012 — Sierra Wireless, Inc. (NASDAQ:  SWIR) (TSX:  SW) today reported second quarter 2012 results. 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.

 

Revenue for the second quarter of 2012 was $167.4 million, compared to $139.9 million in the second quarter of 2011, and $150.3 million in the first quarter of 2012. The year-over-year revenue increase of 19.7 percent was driven by strong sales in our 4G Mobile Computing products and steady growth in our Machine-to-Machine (“M2M”) business. Mobile Computing revenue was $89.9 million, compared to $66.0 million in the second quarter of 2011.  M2M revenue was $77.5 million, compared to $73.9 million in the second quarter of 2011.

 

“Exceptionally strong sales of our 4G Mobile Computing products, combined with steady growth in our Machine-to-Machine business, led to higher than expected revenue and profitability in the second quarter of 2012,” said Jason Cohenour, President and Chief Executive Officer. “In addition, our successful acquisition of Sagemcom’s M2M business expands our leading market share position and further accelerates our growth in the exciting Machine-to-Machine market.”

 

On a GAAP basis, gross margin was $51.3 million, or 30.7 percent of revenue, in the second quarter of 2012, compared to $39.1 million, or 28.0 percent of revenue, in the second quarter of 2011. Operating expenses were $45.1 million and earnings from operations were $6.2 million in the second quarter of 2012, compared to operating expenses of $45.4 million and a loss from operations of $6.3 million in the second quarter of 2011.  Net earnings were $3.6 million, or $0.11 per diluted share, in the second quarter of 2012, compared to a net loss of $6.8 million, or $0.22 per diluted share, in the second quarter of 2011. The second quarter of 2012 results included $2.1 million in acquisition and restructuring costs, compared to $0.4 million in restructuring and integration costs in the second quarter of 2011.

 

On a non-GAAP basis, gross margin was 30.7 percent of revenue in the second quarter of 2012, compared to 28.0 percent of revenue in the second quarter of 2011. Operating expenses were $38.8 million and earnings from

 

1


 

operations were $12.7 million in the second quarter of 2012, compared to operating expenses of $40.0 million and a loss from operations of $0.8 million in the second quarter of 2011. Net earnings were $9.3 million, or $0.30 per diluted share, in the second quarter of 2012 compared to a net loss of $1.0 million, or $0.03 per diluted share, in the second quarter of 2011.

 

The cash, cash equivalents and short-term investments balance at the end of the second quarter of 2012 was $125.3 million, up $18.5 million from the end of the first quarter of 2012. During the second quarter of 2012, we purchased and cancelled 400,000 common shares in the open market for $3.3 million in connection with our normal course issuer bid.

 

Non-GAAP results exclude the impact of stock-based compensation expense, acquisition costs, restructuring costs, integration costs, acquisition amortization, foreign exchange gains or losses on foreign currency contracts as well as 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. The reconciliation between our GAAP and non-GAAP results is provided in the accompanying schedules.

 

Financial guidance

 

Financial guidance for the third quarter of 2012 excludes any impact from the acquisition of the Sagemcom M2M business.  In the third quarter of 2012, we expect revenue and gross margin to decrease on a sequential basis driven primarily by normalizing sales patterns in our Mobile Computing business, following an exceptional Q2.

 

Q3 2012 Guidance

 

Consolidated Non-GAAP

 

 

 

 

 

Revenue

 

$157.0 to $162.0 million

 

 

 

 

 

Earnings from operations

 

$6.0 to $8.0 million

 

 

 

 

 

Net earnings

 

$4.3 to $5.7 million

 

 

 

 

 

Earnings per share

 

$0.14 to $0.19 per share

 

 

This Non-GAAP guidance for the third quarter of 2012 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 below. 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, August 2, 2012, 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

 

2


 

·                  Alternate number: 1-647-788-4901

 

·                  Conference ID: 88885531

 

For those unable to participate in the live call, a replay will be available until August 10, 2012. 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:

 

http://www.snwebcastcenter.com/custom_events/sierrawireless-20120802/site/

 

The webcast will remain available at the above link for one year following the call.

 

We look forward to having you participate in our call.

 

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 third quarter of 2012 and our fiscal year 2012, 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.

 

Forward-looking statements:

 

·                  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 transition period to our 4G products;

 

·                  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.

 

3


 

·                  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, the continuing uncertain economic conditions, price and product competition, different product mix, the loss of any of our significant customers, 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.

 

About Sierra Wireless

 

Sierra Wireless (NASDAQ: SWIR) (TSX: SW) offers industry-leading mobile computing and machine-to-machine (M2M) communications products and solutions that connect people, devices, and applications over cellular networks. Wireless service providers, equipment manufacturers, enterprises and government organizations around the world depend on us for reliable wireless technology. We offer 2G, 3G and 4G wireless modems, routers and gateways as well as a comprehensive suite of software, tools, and services that ensure our customers can successfully bring wireless applications to market.  For more information about Sierra Wireless, visit www.sierrawireless.com.

 

“AirCard” and “AirLink” are registered trademarks of Sierra Wireless. “AirPrime” and “AirVantage” are also trademarks of Sierra Wireless. Other product or service names mentioned herein may be the trademarks of their respective owners.

 

4


 

SIERRA WIRELESS, INC.

 

CONSOLIDATED BALANCE SHEETS

 

(in thousands of U.S. dollars)

 

(unaudited)

 

 

 

June 30,

 

December 31,

 

 

 

2012

 

2011

 

Assets

 

 

 

 

 

Current assets

 

 

 

 

 

Cash and cash equivalents

 

$

123,159

 

$

101,375

 

Short-term investments

 

2,153

 

9,347

 

Accounts receivable, net of allowance for doubtful accounts of $2,477 (2011 - $3,642)

 

111,223

 

107,367

 

Inventories

 

15,157

 

16,168

 

Deferred income taxes

 

8,075

 

6,540

 

Prepaids and other

 

23,579

 

20,674

 

 

 

283,346

 

261,471

 

Property, plant and equipment

 

24,394

 

22,087

 

Intangible assets

 

35,517

 

42,557

 

Goodwill

 

89,345

 

89,961

 

Deferred income taxes

 

6,205

 

6,205

 

Other assets

 

592

 

606

 

 

 

$

439,399

 

$

422,887

 

Liabilities

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

Accounts payable and accrued liabilities

 

$

144,518

 

$

123,547

 

Deferred income taxes

 

—

 

336

 

Deferred revenue and credits

 

1,059

 

1,721

 

 

 

145,577

 

125,604

 

Long-term obligations

 

24,314

 

25,143

 

Deferred income taxes

 

236

 

236

 

 

 

170,127

 

150,983

 

Equity

 

 

 

 

 

Shareholders’ equity

 

 

 

 

 

Common stock: no par value; unlimited shares authorized; issued and outstanding: 30,562,076 shares (December 31, 2011 - 31,306,692 shares)

 

322,521

 

328,440

 

Preferred stock: no par value; unlimited shares authorized; issued and outstanding: nil shares

 

—

 

—

 

Treasury stock: at cost 725,555 shares (December 31, 2011 — 877,559 shares)

 

(5,238

)

(6,141

)

Additional paid-in capital

 

19,886

 

20,087

 

Deficit

 

(58,556

)

(62,482

)

Accumulated other comprehensive loss

 

(9,341

)

(8,000

)

 

 

269,272

 

271,904

 

 

 

$

439,399

 

$

422,887

 

 

5


 

SIERRA WIRELESS, INC.

 

CONSOLIDATED STATEMENTS OF OPERATIONS

 

(in thousands of U.S. dollars, except where otherwise stated)

 

(unaudited)

 

 

 

Three months ended
June 30

 

Six months ended
June 30

 

 

 

2012

 

2011

 

2012

 

2011

 

Revenue

 

$

167,441

 

$

139,888

 

$

317,707

 

$

284,163

 

Cost of goods sold

 

116,106

 

100,788

 

221,606

 

205,599

 

Gross margin

 

51,335

 

39,100

 

96,101

 

78,564

 

Expenses

 

 

 

 

 

 

 

 

 

Sales and marketing

 

11,190

 

11,326

 

23,051

 

23,594

 

Research and development

 

20,773

 

22,025

 

42,169

 

45,537

 

Administration

 

8,746

 

8,810

 

17,346

 

18,195

 

Acquisition costs

 

599

 

—

 

599

 

—

 

Restructuring

 

1,531

 

(350

)

1,711

 

(25

)

Integration

 

—

 

765

 

—

 

1,305

 

Amortization

 

2,275

 

2,794

 

4,662

 

5,642

 

 

 

45,114

 

45,370

 

89,538

 

94,248

 

Earnings (loss) from operations

 

6,221

 

(6,270

)

6,563

 

(15,684

)

Foreign exchange gain (loss)

 

336

 

(221

)

542

 

201

 

Other income (expense)

 

10

 

(13

)

(161

)

(53

)

Earnings (loss) before income taxes

 

6,567

 

(6,504

)

6,944

 

(15,536

)

Income tax expense (recovery)

 

2,986

 

275

 

3,018

 

(924

)

Net earnings (loss)

 

3,581

 

(6,779

)

3,926

 

(14,612

)

Net loss attributable to non-controlling interest

 

—

 

(13

)

—

 

(57

)

Net earnings (loss) attributable to the Company

 

$

3,581

 

$

(6,766

)

$

3,926

 

$

(14,555

)

Net earnings (loss) per share attributable to the Company’s common shareholders (in dollars)

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.12

 

$

(0.22

)

$

0.13

 

$

(0.47

)

Diluted

 

$

0.11

 

$

(0.22

)

$

0.13

 

$

(0.47

)

Weighted average number of shares outstanding (in thousands)

 

 

 

 

 

 

 

 

 

Basic

 

31,082

 

31,267

 

30,996

 

31,252

 

Diluted

 

31,252

 

31,267

 

31,133

 

31,252

 

 

6


 

SIERRA WIRELESS, INC.

 

CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (LOSS)

 

(in thousands of U.S. dollars)

 

(unaudited)

 

 

 

Three months ended
June 30

 

Six months ended
June 30

 

 

 

2012

 

2011

 

2012

 

2011

 

Net earnings (loss)

 

$

3,581

 

$

(6,779

)

$

3,926

 

$

(14,612

)

Other comprehensive income (loss), net of taxes:

 

 

 

 

 

 

 

 

 

Purchase of Wavecom S.A. shares, net of taxes of $nil

 

—

 

42

 

—

 

42

 

Foreign currency translation adjustments, net of taxes of $nil

 

(3,343

)

1,587

 

(1,341

)

6,519

 

Total comprehensive earnings (loss)

 

238

 

(5,150

)

2,585

 

(8,051

)

Comprehensive income (loss) attributable to non-controlling interest:

 

 

 

 

 

 

 

 

 

Net earnings (loss)

 

—

 

(13

)

—

 

(57

)

Foreign currency translation adjustments, net of taxes of $nil

 

—

 

105

 

—

 

106

 

Comprehensive earnings (loss) attributable to the Company

 

$

238

 

$

(5,242

)

$

2,585

 

$

(8,100

)

 

7


 

SIERRA WIRELESS, INC.

 

CONSOLIDATED STATEMENTS OF EQUITY

 

(in thousands of U.S. dollars)

 

(unaudited)

 

 

 

Equity attributable to the Company

 

 

 

 

 

 

 

Common stock

 

Treasury Shares

 

 

 

 

 

 

 

 

 

 

 

 

 

# of
shares

 

$

 

# of
shares

 

$

 

Additional
paid-in
capital

 

Deficit

 

Accumulated
other
comprehensive
income (loss)

 

Non-
controlling
interest
(deficit)

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as at December 31, 2010

 

31,222,786

 

$

327,668

 

643,042

 

$

(3,908

)

$

16,926

 

$

(33,167

)

$

(5,471

)

$

1,139

 

$

303,187

 

Purchase of Wavecom S.A. shares

 

—

 

—

 

—

 

—

 

(796

)

—

 

42

 

(1,033

)

(1,787

)

Stock option exercises

 

83,906

 

772

 

—

 

—

 

(253

)

—

 

—

 

—

 

519

 

Stock-based compensation

 

—

 

—

 

—

 

—

 

6,449

 

—

 

—

 

—

 

6,449

 

Purchase of treasury shares for RSU distribution

 

—

 

—

 

613,638

 

(4,472

)

—

 

—

 

—

 

—

 

(4,472

)

Distribution of vested RSUs

 

—

 

—

 

(379,121

)

2,239

 

(2,239

)

—

 

—

 

—

 

—

 

Net loss

 

—

 

—

 

—

 

—

 

—

 

(29,315

)

—

 

(57

)

(29,372

)

Foreign currency translation adjustments, net of tax

 

—

 

—

 

—

 

—

 

—

 

—

 

(2,571

)

(49

)

(2,620

)

Balance as at December 31, 2011

 

31,306,692

 

$

328,440

 

877,559

 

$

(6,141

)

$

20,087

 

$

(62,482

)

$

(8,000

)

$

—

 

$

271,904

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common share cancellation

 

(800,000

)

(6,312

)

—

 

—

 

—

 

—

 

—

 

—

 

(6,312

)

Stock option exercises

 

55,384

 

393

 

—

 

—

 

(124

)

—

 

—

 

—

 

269

 

Stock-based compensation

 

—

 

—

 

—

 

—

 

3,315

 

—

 

—

 

—

 

3,315

 

Purchase of treasury shares for RSU distribution

 

—

 

—

 

336,638

 

(2,489

)

—

 

—

 

—

 

—

 

(2,489

)

Distribution of vested RSUs

 

—

 

—

 

(488,642

)

3,392

 

(3,392

)

—

 

—

 

—

 

—

 

Net earnings

 

—

 

—

 

—

 

—

 

—

 

3,926

 

—

 

—

 

3,926

 

Foreign currency translation adjustments, net of tax

 

—

 

—

 

—

 

—

 

—

 

—

 

(1,341

)

—

 

(1,341

)

Balance as at June 30, 2012

 

30,562,076

 

$

322,521

 

725,555

 

$

(5,238

)

$

19,886

 

$

(58,556

)

$

(9,341

)

$

—

 

$

269,272

 

 

8


 

SIERRA WIRELESS, INC.

 

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

(in thousands of U.S. dollars)

 

(unaudited)

 

 

 

Three months ended
June 30

 

Six months ended
June 30

 

 

 

2012

 

2011

 

2012

 

2011

 

Cash flows provided (used) by:

 

 

 

 

 

 

 

 

 

Operating activities

 

 

 

 

 

 

 

 

 

Net earnings (loss)

 

$

3,581

 

$

(6,779

)

$

3,926

 

$

(14,612

)

Items not requiring (providing) cash

 

 

 

 

 

 

 

 

 

Amortization

 

6,731

 

8,456

 

13,713

 

17,068

 

Stock-based compensation

 

1,636

 

1,697

 

3,315

 

3,329

 

Deferred income taxes

 

(843

)

(2,219

)

(1,873

)

(2,219

)

Loss (gain) on disposal of property, plant and equipment

 

(33

)

41

 

126

 

33

 

Changes in non-cash working capital

 

 

 

 

 

 

 

 

 

Accounts receivable

 

(5,027

)

9,447

 

(4,414

)

21,667

 

Inventories

 

(2,307

)

665

 

917

 

1,999

 

Prepaid expenses and other

 

(3,677

)

3,624

 

(2,961

)

2,503

 

Accounts payable and accrued liabilities

 

28,557

 

2,302

 

21,472

 

(11,016

)

Deferred revenue and credits

 

(178

)

(50

)

(658

)

(92

)

Cash flows provided by operating activities

 

28,440

 

17,184

 

33,563

 

18,660

 

Investing activities

 

 

 

 

 

 

 

 

 

Purchase of Wavecom S.A. shares

 

—

 

(1,505

)

—

 

(1,505

)

Additions to property, plant and equipment

 

(4,957

)

(6,600

)

(8,560

)

(8,562

)

Proceeds from sale of property, plant and equipment

 

3

 

2

 

64

 

15

 

Increase in intangible assets

 

(567

)

(1,216

)

(1,338

)

(1,957

)

Net change in short-term investments

 

(2,151

)

7,089

 

7,194

 

8,935

 

Cash flows used by investing activities

 

(7,672

)

(2,230

)

(2,640

)

(3,074

)

Financing activities

 

 

 

 

 

 

 

 

 

Issuance of common shares, net of share issue costs

 

255

 

259

 

269

 

465

 

Repurchase of common shares

 

(3,275

)

—

 

(6,312

)

—

 

Purchase of treasury shares for RSU distribution

 

(1,502

)

—

 

(2,489

)

—

 

Repayment of long-term obligations

 

(13

)

11

 

(655

)

(627

)

Cash flows provided (used) by financing activities

 

(4,535

)

270

 

(9,187

)

(162

)

Effect of foreign exchange rate changes on cash and cash equivalents

 

153

 

264

 

48

 

818

 

Cash and cash equivalents, increase in the period

 

16,386

 

15,488

 

21,784

 

16,242

 

Cash and cash equivalents, beginning of period

 

106,773

 

86,197

 

101,375

 

85,443

 

Cash and cash equivalents, end of period

 

$

123,159

 

$

101,685

 

$

123,159

 

$

101,685

 

 

 

 

 

 

 

 

 

 

 

Supplemental disclosures:

 

 

 

 

 

 

 

 

 

Net Income taxes paid (received)

 

$

518

 

$

(1,943

)

$

940

 

$

(1,759

)

Net interest paid (received)

 

(87

)

54

 

(44

)

(53

)

 

9


 

SIERRA WIRELESS, INC.

 

RECONCILIATION OF GAAP AND NON-GAAP RESULTS

 

(in thousands of U.S. dollars, except where otherwise stated)

 

(unaudited)

 

 

 

2012

 

2011

 

(in thousands of U.S. dollars, except where otherwise stated)

 

YTD

 

Q2

 

Q1

 

YTD

 

Q2

 

Q1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue - GAAP and Non-GAAP

 

$

317,707

 

$

167,441

 

$

150,266

 

$

284,163

 

$

139,888

 

$

144,275

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Margin - GAAP

 

$

96,101

 

$

51,335

 

$

44,766

 

$

78,564

 

$

39,100

 

$

39,464

 

Stock-based compensation

 

161

 

78

 

83

 

210

 

97

 

113

 

Gross Margin - Non-GAAP

 

$

96,262

 

$

51,413

 

$

44,849

 

$

78,774

 

$

39,197

 

$

39,577

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings (loss) from operations - GAAP

 

$

6,563

 

$

6,221

 

$

342

 

$

(15,684

)

$

(6,270

)

$

(9,414

)

Stock-based compensation

 

3,315

 

1,636

 

1,679

 

3,329

 

1,697

 

1,632

 

Acquisition

 

599

 

599

 

—

 

—

 

—

 

—

 

Restructuring

 

1,711

 

1,531

 

180

 

(25

)

(350

)

325

 

Integration

 

—

 

—

 

—

 

1,305

 

765

 

540

 

Acquisition related amortization

 

5,646

 

2,665

 

2,981

 

6,600

 

3,312

 

3,288

 

Earnings (loss) from operations - Non-GAAP

 

$

17,834

 

$

12,652

 

$

5,182

 

$

(4,475

)

$

(846

)

$

(3,629

)

Amortization (excluding acquisition related amortization)

 

8,067

 

4,066

 

4,001

 

10,468

 

5,144

 

5,324

 

EBITDA

 

$

25,901

 

$

16,718

 

$

9,183

 

$

5,993

 

$

4,298

 

$

1,695

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Earnings (loss) - GAAP

 

$

3,926

 

$

3,581

 

$

345

 

$

(14,555

)

$

(6,766

)

$

(7,789

)

Stock-based compensation, restructuring and other, integration, and acquisition related amortization, net of tax

 

10,660

 

5,891

 

4,769

 

11,228

 

5,503

 

5,725

 

Unrealized foreign exchange loss (gain)

 

(266

)

(165

)

(101

)

(97

)

238

 

(335

)

Non-controlling interest

 

—

 

—

 

—

 

(32

)

—

 

(32

)

Net earnings (loss) - Non-GAAP

 

$

14,320

 

$

9,307

 

$

5,013

 

$

(3,456

)

$

(1,025

)

$

(2,431

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings (loss) per share - GAAP (in dollars)

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP

 

$

0.13

 

$

0.11

 

$

0.01

 

$

(0.47

)

$

(0.22

)

$

(0.25

)

Non-GAAP

 

$

0.46

 

$

0.30

 

$

0.16

 

$

(0.11

)

$

(0.03

)

$

(0.08

)

 

10


 

SIERRA WIRELESS, INC.

 

SEGMENTED RESULTS

 

(in thousands of U.S. dollars)

 

(unaudited)

 

 

 

Three months ended June 30

 

Six months ended June 30

 

(in thousands of U.S. dollars)

 

2012

 

2011

 

2012

 

2011

 

M2M

 

 

 

 

 

 

 

 

 

Revenue

 

$

77,545

 

$

73,908

 

$

154,488

 

$

146,636

 

Cost of goods sold

 

51,426

 

50,017

 

103,645

 

100,065

 

Gross margin

 

$

26,119

 

23,891

 

$

50,843

 

46,571

 

Gross margin %

 

33.7%

 

32.3%

 

32.9%

 

31.8%

 

 

 

 

 

 

 

 

 

 

 

Mobile Computing

 

 

 

 

 

 

 

 

 

Revenue

 

$

89,896

 

$

65,980

 

$

163,219

 

$

137,527

 

Cost of goods sold

 

64,680

 

50,771

 

117,961

 

105,534

 

Gross margin

 

$

25,216

 

$

15,209

 

$

45,258

 

$

31,993

 

Gross margin %

 

28.1%

 

23.1%

 

27.7%

 

23.3%

 

 

 

 

 

 

SIERRA WIRELESS, INC.

 

REVENUE BY SEGMENT AND PRODUCT

 

(in thousands of U.S. dollars)

 

(unaudited)

 

 

 

 

Three months ended June 30

 

Six months ended June 30

 

(in thousands of U.S. dollars)

 

2012

 

2011

 

2012

 

2011

 

M2M

 

 

 

 

 

 

 

 

 

AirPrime Embedded Wireless Modules (excludes PC OEMs)

 

$

63,768

 

$

62,759

 

$

126,712

 

$

122,454

 

AirLink Intelligent Gateways and Routers

 

11,407

 

8,886

 

22,029

 

18,982

 

AirVantage M2M Cloud Platform and Other

 

2,370

 

2,263

 

5,747

 

5,200

 

 

 

$

77,545

 

$

73,908

 

$

154,488

 

$

146,636

 

 

 

 

 

 

 

 

 

 

 

Mobile Computing

 

 

 

 

 

 

 

 

 

AirCard Mobile Broadband Devices (1)

 

$

69,955

 

$

53,135

 

$

126,893

 

$

116,989

 

AirPrime Embedded Wireless Modules for PC OEMs

 

17,828

 

11,857

 

33,101

 

18,604

 

Other

 

2,113

 

988

 

3,225

 

1,934

 

 

 

$

89,896

 

$

65,980

 

$

163,219

 

$

137,527

 

 

(1)         Clearwire contributed $nil million in mobile computing revenue in the three and six months ended June 30, 2012 compared to $0.1 million and $8.3 million in the three and six months ended June 30, 2011, respectively.

 

11