SWIR
$11.12
Sierra Wireless IN
($.12)
(1.07%)
Earnings Details
2nd Quarter June 2019
Wednesday, July 31, 2019 4:42:00 PM
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Summary

Sierra Wireless IN Beats

Sierra Wireless IN (SWIR) reported 2nd Quarter June 2019 earnings of $0.05 per share on revenue of $191.4 million. The consensus earnings estimate was $0.05 per share on revenue of $190.0 million. The Earnings Whisper number was $0.02 per share. Revenue fell 5.2% compared to the same quarter a year ago.

The company said it continues to expect 2019 non-GAAP earnings of $0.30 to $0.35 per share but now expects revenue to be slightly below $793.6 million. The company's previous guidance was for revenue of approximately $793.6 million and the current consensus earnings estimate is $0.32 per share on revenue of $791.8 million for the year ending December 31, 2019.

Sierra Wireless Inc provides cellular wireless solutions to machine-to-machine and connected device markets. Its products, services and solutions connect people, their mobile computers and machines to wireless voice and data networks around the world.

Results
Reported Earnings
$0.05
Earnings Whisper
$0.02
Consensus Estimate
$0.05
Reported Revenue
$191.4 Mil
Revenue Estimate
$190.0 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Sierra Wireless Reports Second Quarter 2019 Results

VANCOUVER, British Columbia--(BUSINESS WIRE)--Sierra Wireless, Inc. (NASDAQ: SWIR) (TSX: SW) today reported results for its second quarter ended June 30, 2019. 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 2019 was $191.4 million compared to $201.9 million in the second quarter of 2018. Quarterly revenue for our two business segments was as follows: (i) Revenue from IoT Solutions was $99.2 million in the second quarter of 2019, up 6.3% compared to $93.3 million in the second quarter of 2018 driven by strong sales of Airlink gateway products and managed connectivity services; and (ii) Revenue from Embedded Broadband was $92.2 million in the second quarter of 2019, down 15.1% compared to $108.6 million in the second quarter of 2018 mainly due to weaker demand from mobile computing.

“I’m pleased that we delivered solid earnings results in the Second Quarter,’” said Kent Thexton, President and CEO of Sierra Wireless. “We are building a strong and growing funnel of customer opportunities in IoT Solutions and are continuing to make good progress as we transform the business.”

GAAP RESULTS

  • Gross margin was $58.9 million, or 30.8% of revenue, in the second quarter of 2019 compared to $69.3 million, or 34.3% of revenue, in the second quarter of 2018.
  • Restructuring expense was $18.2 million compared to $1.0 million in the second quarter of 2018.
  • Operating expenses were $82.2 million and loss from operations was $23.3 million in the second quarter of 2019 compared to operating expenses of $74.4 million and loss from operations of $5.1 million in the second quarter of 2018.
  • Net loss was $28.2 million, or $0.78 per diluted share, in the second quarter of 2019 compared to net loss of $11.4 million, or $0.32 per diluted share, in the second quarter of 2018.

NON-GAAP RESULTS(1)

  • Gross margin was 30.8% in the second quarter of 2019 compared to 34.4% in the second quarter of 2018.
  • Operating expenses were $55.6 million and earnings from operations was $3.4 million in the second quarter of 2019 compared to operating expenses of $59.0 million and earnings from operations of $10.4 million in the second quarter of 2018.
  • Net earnings were $2.5 million, or $0.07 per diluted share, in the second quarter of 2019 compared to net earnings of $9.7 million, or $0.27 per diluted share, in the second quarter of 2018.
  • Adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA") were $7.9 million in the second quarter of 2019 compared to $15.6 million in the second quarter of 2018.

(1) See "Non-GAAP Financial Measures" and "Reconciliation of GAAP and Non-GAAP Results by Quarter" below.

Cash and cash equivalents at the end of the second quarter of 2019 were $84.8 million, representing an increase of $10.6 million from the end of the first quarter of 2019. The increase in cash was primarily due to cash flow from operating activities, which included proceeds from a receivable purchase agreement of $16.5 million, partially offset by capital expenditures.

On April 30, 2019, we announced two initiatives related to the acceleration of our transformation to a Device-to Cloud IoT solutions company: (1) the consolidation of engineering resources and the transfer of certain functions to lower cost locations; and (2) the outsourcing of a select group of G&A transaction-based activities. In Q2 2019, we recorded $14.9 million in severance and $3.1 million in transitional costs related to these two initiatives. Additionally, we recorded $0.2 million in severance and other related costs related to certain organizational changes we implemented in late 2018.

Accounting Standard Adoption

We adopted the new accounting standard for lease accounting (ASC 842) effective January 1, 2019. Our second quarter 2019 financial results reflect the adoption of this new standard.

Financial Guidance - Full Year

For the year ended December 31, 2019, we are maintaining our profitability guidance of Adjusted EBITDA to be approximately $35 million and non-GAAP net earnings per share to be approximately $0.30 to $0.35. We now expect consolidated revenue to be slightly lower year over year due to weaker global demand in automotive combined with delays in the launch of new automotive programs, partly offset by growth in higher margin IoT Solutions. See "Non-GAAP Financial Measures" below.

This non-GAAP guidance constitutes "forward-looking statements" within the meaning of applicable securities laws and reflects current business indicators and expectations. These statements are based on management's current beliefs and assumptions, which could prove to be significantly incorrect. Forward-looking statements, particularly those that relate to longer periods of time, are subject to substantial known and unknown risks and uncertainties that could cause actual events or results to differ significantly from those expressed or implied by our forward-looking statements, including those described in our regulatory filings. See "Cautionary Note Regarding Forward-Looking Statements" below.

Non-GAAP Financial Measures

We disclose these non-GAAP financial measures as we believe they provide useful information to investors and analysts to assist them in their evaluation of our operating results and to assist in comparisons from one period to another. Readers are cautioned that non-GAAP financial measures do not have any standardized meaning prescribed by U.S. GAAP and therefore may not be comparable to similar measures presented by other companies.

Non-GAAP gross margin excludes the impact of stock-based compensation expense and related social taxes and certain other nonrecurring costs or recoveries.

Non-GAAP earnings (loss) from operations includes allocation of realized gains or losses on forward contracts and excludes the impact of stock-based compensation expense and related social taxes, acquisition-related amortization, acquisition-related and integration costs, restructuring costs, impairment and certain other non-recurring costs or recoveries.

Non-GAAP income tax expense includes certain tax adjustments and taxes on acquisition-related amortization, acquisition-related and integration costs, restructuring costs, other non-recurring costs and foreign exchange.

In addition to the above, non-GAAP net earnings (loss) and non-GAAP net earnings (loss) per share exclude the impact of foreign exchange gains or losses on translation of certain balance sheet accounts, foreign exchange gains or losses on forward contracts and certain tax adjustments.

We use the above-noted non-GAAP financial measures for planning purposes and to allow us to assess the performance of our business before including the impacts of the items noted above as they affect the comparability of our financial results. These non-GAAP measures are reviewed regularly by management and the Board of Directors as part of the ongoing internal assessment of our operating performance. We also use non-GAAP earnings from operations as one component in determining short-term incentive compensation for management employees.

Adjusted EBITDA is defined as net earnings (loss) plus stock-based compensation expense and related social taxes, acquisition-related and integration costs, restructuring cost, impairment, certain other nonrecurring costs or recoveries, amortization, foreign exchange gains or losses on translation of certain balance sheet accounts, unrealized foreign exchange gains or losses on forward contracts, interest and income tax expense. Adjusted EBITDA is a metric used by investors and analysts for valuation purposes and is an important indicator of our operating performance and our ability to generate liquidity through operating cash flow that will fund future working capital needs and fund future capital expenditures.

Conference call and webcast details

Sierra Wireless President and CEO, Kent Thexton, and CFO, David McLennan, will host a conference call and webcast with analysts and investors to review the results on Wednesday, July 31, 2019, at 5:30 PM Eastern time (2:30 PM Pacific time). 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 start of the call:

  • Toll-free (Canada and US): 1-877-201-0168
  • Alternate number: 1-647-788-4901
  • Conference ID: 7577535

To access the webcast, please follow the link below:

Sierra Wireless Q2 2019 Conference Call and Webcast

If the above link does not work, please copy and paste the following URL into your browser:

http://event.on24.com/r.htm?e=2017192&s=1&k=29C8169C1036AD64D12449E19817C207

The webcast will remain available at the above link for one year following the 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”) and may include statements and information relating to our Q2 2019 corporate update; financial guidance for our fiscal year 2019, expectations regarding the Company's cost savings initiatives, our business outlook for the short and longer term, statements regarding our strategy, plans, goals, objectives, expectations and future operating performance; the Company’s liquidity and capital resources; the Company’s financial and operating objectives and strategies to achieve them; general economic conditions; estimates of our expenses, future revenues, non-GAAP earnings per share and capital requirements; our expectations regarding the legal proceedings we are involved in; statements with respect to the Company’s estimated working capital; expectations with respect to the adoption of IoT solutions; expectations regarding trends in the IoT market and wireless module market; expectations regarding product and price competition from other wireless device manufacturers and solution providers; and our ability to implement effective control procedures. Forward-looking statements are provided to help you understand our views of our short and long term plans, expectations and prospects. We caution you that forward-looking statements may not be appropriate for other purposes. We do not intend to 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", "will", "may", “expects”, “is expected”, “anticipates”, “believes”, “plans”, “projects”, “estimates”, “assumes”, “intends”, “strategy”, “goals”, “objectives”, “potential”, “possible”, or variations thereof.
  • 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, but not limited to, 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 macro-economic business conditions;
    • expected cost of sales;
    • expected component supply constraints;
    • our ability to win new business;
    • our ability to integrate acquired businesses and realize expected benefits;
    • expected deployment of next generation networks by wireless network operators;
    • our operations not being adversely disrupted by other developments, operating, cyber security, litigation, or regulatory risks; and
    • expected tax and foreign exchange rates.
  • Are based on our management's current expectations and we caution investors that forward-looking statements, particularly those that relate to longer periods of time, 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:
    • competition from new or established competitors or from those with greater resources;
    • the loss of, or significant demand fluctuations from, any of our significant customers;
    • our business transformation initiatives may result in disruptions to our business and may not achieve the anticipated benefits;
    • our ability to attract or retain key personnel and the impact of organizational change on our business;
    • our ability to respond to changing technology, industry standards and customer requirements;
    • failures of our products or services due to design flaws and errors, component quality issues, manufacturing defects, network service interruptions, cyber-security vulnerabilities or other quality issues;
    • deterioration in macro-economic conditions and resulting reduced demand for our products and services;
    • cyber-attacks or other breaches of our information technology security;
    • risks related to the transmission, use and disclosure of user data and personal information;
    • our financial results being subject to fluctuation;
    • disruption of, and demands on, our ongoing business and diversion of management's time and attention in connection with acquisitions or divestitures;
    • risks related to infringement on intellectual property rights of others;
    • our ability to obtain necessary rights to use software or components supplied by third parties;
    • our ability to enforce our intellectual property rights;
    • our reliance on single source suppliers for certain components used in our products;
    • our dependence on a limited number of third party manufacturers;
    • unanticipated costs associated with litigation or settlements;
    • our dependence on mobile network operators to promote and offer acceptable wireless data services;
    • risks related to contractual disputes with counterparties;
    • risks related to governmental regulation;
    • risks inherent in foreign jurisdictions; and
    • risks related to tariffs or other trade restrictions.

About Sierra Wireless

Sierra Wireless (NASDAQ: SWIR) (TSX: SW) is an IoT pioneer, empowering businesses and industries to transform and thrive in the connected economy. Customers start with Sierra because we offer a device to cloud solution, comprised of embedded and networking solutions seamlessly integrated with our secure cloud and connectivity services. OEMs and enterprises worldwide rely on our expertise in delivering fully integrated solutions to reduce complexity, turn data into intelligence and get their connected products and services to market faster. Sierra Wireless has more than 1,300 employees globally and operates R&D centers in North America, Europe and Asia. For more information, visit www.sierrawireless.com.

AirPrime, AirLink, AirVantage, mangOH and Legato 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 EARNINGS (LOSS)

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

(unaudited)

 

Three months ended June 30,

 

Six months ended June 30,

 

2019

 

2018

 

2019

 

2018

Revenue

 

 

 

 

 

 

 

IoT Solutions

$

99,145

 

 

$

93,274

 

 

$

193,432

 

 

$

182,722

 

Embedded Broadband

92,229

 

 

108,629

 

 

171,755

 

 

206,059

 

 

191,374

 

 

201,903

 

 

365,187

 

 

388,781

 

Cost of sales

 

 

 

 

 

 

 

IoT Solutions

62,334

 

 

58,992

 

 

122,142

 

 

115,830

 

Embedded Broadband

70,091

 

 

73,602

 

 

129,466

 

 

141,542

 

 

132,425

 

 

132,594

 

 

251,608

 

 

257,372

 

Gross margin

58,949

 

 

69,309

 

 

113,579

 

 

131,409

 

Expenses

 

 

 

 

 

 

 

Sales and marketing

23,755

 

 

22,066

 

 

46,261

 

 

44,491

 

Research and development

22,111

 

 

24,391

 

 

44,908

 

 

48,856

 

Administration

12,893

 

 

19,804

 

 

25,290

 

 

32,068

 

Restructuring

18,180

 

 

952

 

 

19,577

 

 

4,543

 

Acquisition-related and integration

314

 

 

1,014

 

 

409

 

 

2,779

 

Amortization

4,967

 

 

6,137

 

 

10,211

 

 

13,603

 

 

82,220

 

 

74,364

 

 

146,656

 

 

146,340

 

Loss from operations

(23,271

)

 

(5,055

)

 

(33,077

)

 

(14,931

)

Foreign exchange gain (loss)

854

 

 

(4,048

)

 

2

 

 

(2,933

)

Other (expense) income

(102

)

 

8

 

 

(71

)

 

63

 

Loss before income taxes

(22,519

)

 

(9,095

)

 

(33,146

)

 

(17,801

)

Income tax expense

5,657

 

 

2,289

 

 

6,253

 

 

1,946

 

Net loss

$

(28,176

)

 

$

(11,384

)

 

$

(39,399

)

 

$

(19,747

)

Other comprehensive gain (loss):

 

 

 

 

 

 

 

Foreign currency translation adjustments, net of taxes of $nil

95

 

 

(6,474

)

 

(3,520

)

 

(7,241

)

Comprehensive loss

$

(28,081

)

 

$

(17,858

)

 

$

(42,919

)

 

$

(26,988

)

 

 

 

 

 

 

 

 

Net loss per share (in dollars)

 

 

 

 

 

 

 

Basic

$

(0.78

)

 

$

(0.32

)

 

$

(1.09

)

 

$

(0.55

)

Diluted

(0.78

)

 

(0.32

)

 

(1.09

)

 

(0.55

)

Weighted average number of shares outstanding (in thousands)

 

 

 

 

 

 

 

Basic

36,156

 

 

36,021

 

 

36,131

 

 

35,967

 

Diluted

36,156

 

 

36,021

 

 

36,131

 

 

35,967

 

SIERRA WIRELESS, INC.

CONSOLIDATED BALANCE SHEETS

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

(unaudited)

 

June 30, 2019

 

December 31, 2018

Assets

 

 

 

Current assets

 

 

 

Cash and cash equivalents

$

84,769

 

 

$

89,076

 

Restricted cash

221

 

 

221

 

Accounts receivable, net of allowance for doubtful accounts of $3,574 (December 31, 2018$2,968)

151,219

 

 

171,725

 

Inventories

56,327

 

 

50,779

 

Prepaids and other

16,476

 

 

11,703

 

 

309,012

 

 

323,504

 

Property and equipment

39,489

 

 

39,842

 

Operating lease right-of-use assets

26,114

 

 

 

Intangible assets

77,545

 

 

84,890

 

Goodwill

208,752

 

 

211,074

 

Deferred income taxes

6,802

 

 

11,751

 

Other assets

13,383

 

 

12,855

 

 

$

681,097

 

 

$

683,916

 

 

 

 

 

Liabilities

 

 

 

Current liabilities

 

 

 

Accounts payable and accrued liabilities

$

195,091

 

 

$

184,220

 

Deferred revenue

8,719

 

 

6,213

 

 

203,810

 

 

190,433

 

Long-term obligations

40,267

 

 

43,250

 

Operating lease liabilities

23,546

 

 

 

Deferred income taxes

5,848

 

 

6,103

 

 

273,471

 

 

239,786

 

Equity

 

 

 

Shareholders’ equity

 

 

 

Common stock: no par value; unlimited shares authorized; issued and

outstanding: 36,165,096 shares (December 31, 2018 – 36,067,415 shares)

434,316

 

 

432,552

 

Preferred stock: no par value; unlimited shares authorized;

issued and outstanding: nil shares

 

 

 

Treasury stock: at cost; 17,892 shares (December 31, 2018 – 119,584 shares)

(229

)

 

(1,965

)

Additional paid-in capital

33,899

 

 

30,984

 

Retained deficit

(47,694

)

 

(8,295

)

Accumulated other comprehensive loss

(12,666

)

 

(9,146

)

 

407,626

 

 

444,130

 

 

$

681,097

 

 

$

683,916

 

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,

 

2019

 

2018

 

2019

 

2018

Cash flows provided by (used in):

 

 

 

 

 

 

 

Operating activities

 

 

 

 

 

 

 

Net loss

$

(28,176

)

 

$

(11,384

)

 

$

(39,399

)

 

$

(19,747

)

Items not requiring (providing) cash

 

 

 

 

 

 

 

Amortization

8,118

 

 

9,651

 

 

16,489

 

 

20,359

 

Stock-based compensation

4,102

 

 

4,237

 

 

7,260

 

 

7,051

 

Deferred income taxes

4,961

 

 

1,014

 

 

5,038

 

 

1,082

 

Unrealized foreign exchange (gain) loss

(2,230

)

 

5,887

 

 

(1,976

)

 

4,325

 

Other

478

 

 

130

 

 

586

 

 

569

 

Changes in non-cash working capital

 

 

 

 

 

 

 

Accounts receivable

1,184

 

 

(4,449

)

 

17,998

 

 

(1,692

)

Inventories

1,116

 

 

(7,413

)

 

(5,619

)

 

(789

)

Prepaids and other

2,129

 

 

(154

)

 

(5,518

)

 

(5,718

)

Accounts payable and accrued liabilities

22,765

 

 

16,440

 

 

7,599

 

 

18,426

 

Deferred revenue

1,347

 

 

(2,638

)

 

2,718

 

 

(1,689

)

Cash flows provided by operating activities

15,794

 

 

11,321

 

 

5,176

 

 

22,177

 

Investing activities

 

 

 

 

 

 

 

Additions to property and equipment

(4,273

)

 

(4,935

)

 

(8,131

)

 

(8,999

)

Additions to intangible assets

(905

)

 

(641

)

 

(1,393

)

 

(1,486

)

Proceeds from sale of property and equipment

27

 

 

45

 

 

84

 

 

62

 

Proceeds from sale of iTank business

 

 

 

 

500

 

 

 

Cash flows used in investing activities

(5,151

)

 

(5,531

)

 

(8,940

)

 

(10,423

)

Financing activities

 

 

 

 

 

 

 

Issuance of common shares

73

 

 

607

 

 

167

 

 

1,278

 

Purchase of treasury shares for RSU distribution

(267

)

 

 

 

(267

)

 

 

Taxes paid related to net settlement of equity awards

(75

)

 

(789

)

 

(745

)

 

(1,454

)

Payment for contingent consideration

 

 

(130

)

 

 

 

(130

)

Decrease in other long-term obligations

(73

)

 

(244

)

 

(214

)

 

(443

)

Cash flows used in financing activities

(342

)

 

(556

)

 

(1,059

)

 

(749

)

Effect of foreign exchange rate changes on cash and cash equivalents

325

 

 

(2,411

)

 

516

 

 

(2,597

)

Cash, cash equivalents and restricted cash, increase (decrease) in the period

10,626

 

 

2,823

 

 

(4,307

)

 

8,408

 

Cash, cash equivalents and restricted cash, beginning of period

74,364

 

 

70,809

 

 

89,297

 

 

65,224

 

Cash, cash equivalents and restricted cash, end of period

$

84,990

 

 

$

73,632

 

 

$

84,990

 

 

$

73,632

 

SIERRA WIRELESS, INC.

RECONCILIATION OF GAAP AND NON-GAAP RESULTS BY QUARTER

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

 

2019

 

 

2018

 

Q2

Q1

 

 

Total

Q4

Q3

Q2

Q1

 

 

 

 

 

 

 

 

 

 

 

Gross margin - GAAP

 

$

58,949

 

$

54,630

 

 

 

$

264,571

 

$

65,895

 

$

67,267

 

$

69,309

 

$

62,100

 

Stock-based compensation and related social taxes

 

44

 

59

 

 

 

479

 

58

 

57

 

57

 

307

 

Realized losses on hedge contracts

 

(2

)

(3

)

 

 

(30

)

(13

)

(11

)

 

(6

)

Other nonrecurring costs

 

 

 

 

 

5

 

5

 

 

 

 

Gross margin - Non-GAAP

 

$

58,991

 

$

54,686

 

 

 

$

265,025

 

$

65,945

 

$

67,313

 

$

69,366

 

$

62,401

 

 

 

 

 

 

 

 

 

 

 

 

Earnings (loss) from operations - GAAP

 

$

(23,271

)

$

(9,806

)

 

 

$

(18,275

)

$

(4,197

)

$

853

 

$

(5,055

)

$

(9,876

)

Stock-based compensation and related social taxes

 

4,102

 

3,414

 

 

 

13,006

 

2,743

 

3,473

 

3,950

 

2,840

 

Acquisition-related and integration

 

314

 

95

 

 

 

3,962

 

613

 

570

 

1,014

 

1,765

 

Restructuring

 

18,180

 

1,397

 

 

 

7,115

 

2,345

 

227

 

952

 

3,591

 

Other nonrecurring costs

 

662

 

1,167

 

 

 

11,485

 

4,761

 

1,583

 

5,141

 

 

Realized losses on hedge contracts

 

(183

)

(109

)

 

 

(562

)

(296

)

(201

)

(14

)

(51

)

Acquisition-related amortization

 

3,624

 

3,687

 

 

 

18,575

 

4,261

 

4,354

 

4,426

 

5,534

 

Earnings (loss) from operations - Non-GAAP

 

$

3,428

 

$

(155

)

 

 

$

35,306

 

$

10,230

 

$

10,859

 

$

10,414

 

$

3,803

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings (loss) - GAAP

 

$

(28,176

)

$

(11,223

)

 

 

$

(24,610

)

$

(3,826

)

$

(1,037

)

$

(11,384

)

$

(8,363

)

Stock-based compensation and related social taxes, restructuring, impairment, acquisition-related, integration and other non-recurring costs (recoveries)

 

23,258

 

6,073

 

 

 

35,568

 

10,462

 

5,853

 

11,057

 

8,196

 

Amortization

 

8,118

 

8,371

 

 

 

39,150

 

9,308

 

9,483

 

9,651

 

10,708

 

Interest and other, net

 

102

 

(31

)

 

 

(51

)

19

 

(7

)

(8

)

(55

)

Foreign exchange loss (gain)

 

(1,037

)

743

 

 

 

4,908

 

2,082

 

(42

)

4,034

 

(1,166

)

Income tax expense (recovery)

 

5,657

 

596

 

 

 

916

 

(2,768

)

1,738

 

2,289

 

(343

)

Adjusted EBITDA

 

7,922

 

4,529

 

 

 

55,881

 

15,277

 

15,988

 

15,639

 

8,977

 

Amortization (exclude acquisition-related amortization)

 

(4,494

)

(4,684

)

 

 

(20,575

)

(5,047

)

(5,129

)

(5,225

)

(5,174

)

Interest and other, net

 

(102

)

31

 

 

 

51

 

(19

)

7

 

8

 

55

 

Income tax expense - Non-GAAP

 

(859

)

(730

)

 

 

(2,930

)

(1,245

)

(352

)

(769

)

(564

)

Net earnings (loss) - Non-GAAP

 

$

2,467

 

$

(854

)

 

 

$

32,427

 

$

8,966

 

$

10,514

 

$

9,653

 

$

3,294

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net earnings (loss) per share

 

 

 

 

 

 

 

 

 

 

GAAP - (in dollars per share)

 

$

(0.78

)

$

(0.31

)

 

 

$

(0.68

)

$

(0.11

)

$

(0.03

)

$

(0.32

)

$

(0.23

)

Non-GAAP - (in dollars per share)

 

$

0.07

 

$

(0.02

)

 

 

$

0.90

 

$

0.25

 

$

0.29

 

$

0.27

 

$

0.09

 

 

 

 

 

 

 

 

 

 

 

 

SIERRA WIRELESS, INC.

SEGMENTED RESULTS

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

2019

 

2018

 

Q2

Q1

 

Total

Q4

Q3

Q2

Q1

 

 

 

 

 

 

 

 

 

 

IoT Solutions

 

 

 

 

 

 

 

 

 

Revenue

 

$

99,145

 

$

94,287

 

 

$

373,937

 

$

95,728

 

$

95,487

 

$

93,274

 

$

89,448

 

Gross margin

 

 

 

 

 

 

 

 

 

- GAAP

 

$

36,811

 

$

34,479

 

 

$

139,602

 

$

36,651

 

$

36,059

 

$

34,282

 

$

32,610

 

- Non-GAAP

 

$

36,833

 

$

34,510

 

 

$

139,818

 

$

36,675

 

$

36,081

 

$

34,308

 

$

32,754

 

Gross margin %

 

 

 

 

 

 

 

 

 

- GAAP

 

37.1

%

36.6

%

 

37.3

%

38.3

%

37.8

%

36.8

%

36.5

%

- Non-GAAP

 

37.2

%

36.6

%

 

37.4

%

38.3

%

37.8

%

36.8

%

36.6

%

 

 

 

 

 

 

 

 

 

 

Embedded Broadband

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

92,229

 

$

79,526

 

 

$

419,665

 

$

105,667

 

$

107,939

 

$

108,629

 

$

97,430

 

Gross margin

 

 

 

 

 

 

 

 

 

- GAAP

 

$

22,138

 

$

20,151

 

 

$

124,969

 

$

29,244

 

$

31,208

 

$

35,027

 

$

29,490

 

- Non-GAAP

 

$

22,158

 

$

20,176

 

 

$

125,207

 

$

29,270

 

$

31,232

 

$

35,058

 

$

29,647

 

Gross margin %

 

 

 

 

 

 

 

 

 

- GAAP

 

24.0

%

25.3

%

 

29.8

%

27.7

%

28.9

%

32.2

%

30.3

%

- Non-GAAP

 

24.0

%

25.4

%

 

29.8

%

27.7

%

28.9

%

32.3

%

30.4

%

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

Revenue

 

$

191,374

 

$

173,813

 

 

$

793,602

 

$

201,395

 

$

203,426

 

$

201,903

 

$

186,878

 

Gross margin

 

 

 

 

 

 

 

 

 

- GAAP

 

$

58,949

 

$

54,630

 

 

$

264,571

 

$

65,895

 

$

67,267

 

$

69,309

 

$

62,100

 

- Non-GAAP

 

$

58,991

 

$

54,686

 

 

$

265,025

 

$

65,945

 

$

67,313

 

$

69,366

 

$

62,401

 

Gross margin %

 

 

 

 

 

 

 

 

 

- GAAP

 

30.8

%

31.4

%

 

33.3

%

32.7

%

33.1

%

34.3

%

33.2

%

- Non-GAAP

 

30.8

%

31.5

%

 

33.4

%

32.7

%

33.1

%

34.4

%

33.4

%

 

 

 

 

 

 

 

 

 

 

 

Investor and Media Contact:
David Climie
Vice President, Investor Relations
+1 (604) 231-1137
dclimie@sierrawireless.com

Investor Contact:
David G. McLennan
Chief Financial Officer
+1 (604) 231-1181
investor@sierrawireless.com

Source: Sierra Wireless, Inc.