CHARLOTTE, N.C.-Glenayre Technologies Inc. reported financial results for the first quarter that included a net loss of $9.9 million, or 3 cents per share, compared with a loss of $100,000, or break-even per share, the previous year.
Glenayre attributed the decline to a 26-percent drop in net sales from last year’s first quarter, to $70 million from $94.5 million. The company added it may experience further negative impacts on future quarterly results due to the weak financial condition of a customer that previously had provided about $49 million in financing.
“We are continuing to evaluate strategic initiatives that will help Glenayre regain positive momentum,” said Ramon Ardizzone, Glenayre’s chairman. “For example, last week we announced two major agreements with Motorola (Inc.) and Solectron (Corp.) that will improve the company’s market share, cash position and operating costs. These agreements are beneficial for the company, and we expect to realize positive contributions in the latter half of this year.”
Stan Ciepcielinski, Glenayre chief financial officer, said the company also has implemented a new way of accounting its quarterly results. “Due to last quarter’s restatement of in-process research and development based on new guidance from the Securities and Exchange Commission, the company will include a new measure of financial performance in its earnings announcements,” Ciepcielinski said. “The new measure will exclude amortization of intangibles from net income.”
Glenayre stock fell about 50 cents following the earnings release, from $4 to about $3.46 at press time.
Meanwhile, Glenayre announced an agreement with Vodafone Paging Ltd. in the United Kingdom in which the two said they will conduct market-focus trials to identify the requirements for a new generation of wireless data messaging infrastructure and devices. In particular, Glenayre said it will test Internet-based messaging, wireless chat and information services.
“Internet penetration rates in the United Kingdom are among the highest in Europe,” stated Lee Ellison, senior vice president of sales and marketing at Glenayre.
