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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) JULY 16, 1998
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P-COM, INC.
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(Exact name of registrant as specified in charter)
DELAWARE 0-25356 77-02893711
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
3175 S. WINCHESTER BOULEVARD, CAMPBELL, CALIFORNIA 95008
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (408) 866-3666
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NOT APPLICABLE
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(Former name or former address, if changed since last report.)
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ITEM 5. Other Events
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In a press release disseminated on July 16, 1998, the Registrant
publicly announced its earnings for the quarter ended June 30, 1998.
A copy of the press release is attached hereto and incorporated herein
by reference.
ITEM 7. Financial Statements and Exhibits
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A copy of the Registrant's press release announcing its earnings for
the quarter ended June 30, 1998 is attached hereto as an exhibit.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
P-COM, INC.
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(Registrant)
Date: July 17, 1998 By: /s/ Michael J. Sophie
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Name: Michael J. Sophie
Title: Chief Financial Officer
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EXHIBIT INDEX
Exhibit
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99.1 Press Release disseminated July 16, 1998.
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EXHIBIT 99.1
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Thursday July 16, 4:00 pm Eastern Time
Company Press Release
P-Com, Inc. Announces Results for Second Quarter of 1998
CAMPBELL, Calif.--(BUSINESS WIRE)--July 16, 1998--P-Com, Inc. (NASDAQ/NMS:PCMS -
news), reported results for its second quarter ended June 30, 1998 with sales of
$63.5 million, a 15.3% increase over $55.1 million in sales for the comparable
quarter of 1997.
For the six months ended June 30, 1998, sales were $122.1 million, a 23%
increase over the $99.3 million for the same period in 1997.
The Company's net income of $346,000 for the second quarter of 1998 compares to
a net income of $5.1 million for the comparable period last year. The net income
results of $0.01 per dilutive share with weighted average common and common
equivalent shares of 44.3 million in the second quarter of 1998 compares to a
net income per dilutive share of $0.12 with weighted average common and common
equivalent shares of 43.8 million for the prior year's second quarter.
The results of operations for the first six months of 1998, without giving
effect to a one time in-process research and development charge of $33.9 million
associated in the first quarter of 1998 with the acquisition of Cylink Wireless
Communications Group, were a fully taxed net income of $5.4 million or diluted
net income per share of $0.12 with weighted average common and common equivalent
shares of 44.4 million.
For the six months ended June 30, 1998 the Company's actual net loss was $16.9
million (including the one time in-process research and development charge)
which compares to net income of $6.8 million for the comparable six month period
last year. The basic and diluted net loss of $0.39 per share with weighted
average common shares of 43.1 million in the first six months of 1998 compares
to diluted net income per share of $0.16 with weighted average common and common
equivalent shares of 43.5 million for the prior year's first six months.
P-Com's Chairman and Chief Executive Officer George P. Roberts said, "Our
results reflected in part the intensely competitive environment for point-to-
point (PTP) radio products. Outside the point-to-point product line we are
encouraged by the progress we have made on the initiatives which are critical to
our long term strategy."
Michael J. Sophie, Chief Financial Officer and Vice President, Finance added,
"The current environment makes our ongoing efforts to reduce manufacturing
costs and control expenses all the more important. As we meet our objectives we
will continue to deliver state-of-the-art point-to-point and point-to-multipoint
radio systems to our customers in a cost effective manner."
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P-Com, Inc. develops manufactures and markets network access systems for the
worldwide wireless telecommunications market. The point-to-point, spread
spectrum, and point-to-multipoint radio links provided by P-Com are designed to
satisfy the network requirements of cellular and personal communications
services, corporate communications, public utilities and local governments.
Statements in this release that are forward looking involve known and unknown
risks and uncertainties, which may cause the Company's actual results in future
periods to be materially different from any future performance that may be
suggested in this release. Such factors may include, but are not limited to,
reliance upon subcontractors, fluctuations in customer demand and commitments,
both in timing and volume, pricing and competition, the Company's ability to
have available an appropriate amount of production capacity in a timely manner,
the ability of the Company's customers to finance their purchases of the
Company's products and/or services, the timing of new technology and product
introductions and the risk of early obsolescence. Further, the Company operates
in an industry sector where securities values are highly volatile and may be
influenced by economic and other factors beyond the Company's control, such as
announcements by competitors and service providers. Reference is made to the
discussion of risk factors detailed in the Company's filings with the Securities
and Exchange Commission, including its reports on Form 10-K and 10-Q.
P-Com, Inc., with world headquarters in Campbell, California, USA and offices in
Florida, New Jersey, Virginia, the UK, Italy, France, Germany, Poland, Mexico,
and China, is an ISO 9001 certified company. For additional information, contact
P-Com at:
P-COM, INC.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share data, unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
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June 30, June 30, June 30, June 30,
1998 1997 1998 1997
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<S> <C> <C> <C> <C>
Sales $63,459 $55,058 $122,096 $99,285
Cost of Sales 38,740 32,375 72,252 59,827
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Gross profit 24,719 22,683 49,844 39,458
Operating expenses:
Research and development 10,192 7,051 17,920 13,825
Selling and marketing 6,438 4,008 10,663 6,923
General and administrative 4,937 4,032 8,869 7,469
Goodwill amortization 1,187 565 1,818 911
Acquired in-process
research and
</TABLE>
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<TABLE>
<S> <C> <C> <C> <C>
development expenses -- -- 33,882 --
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Total operating expenses 22,754 15,656 73,152 29,128
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Income (loss) from
operations 1,965 7,027 (23,308) 10,330
Interest and other
income (expense), net (1,442) (100) (2,306) (171)
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Income (loss) before
income taxes 523 6,927 (25,614) 10,159
Provision (benefit)
for income taxes 177 1,816 (8,711) 3,369
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Net income (loss) $ 346 $ 5,111 $(16,903) $ 6,790
Net income (loss) per share:
Basic $ 0.01 $ 0.12 $ (0.39) $ 0.16
Diluted $ 0.01 $ 0.12 $ (0.39) $ 0.16
Shares used in per
share computation:
Basic 43,201 42,174 43,077 41,772
Diluted 44,253 43,771 43,077 43,504
</TABLE>
P-COM, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
<TABLE>
<CAPTION>
June 30, 1998 December 31, 1997
(unaudited)
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<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 24,988 $ 88,145
Accounts receivable, net 79,422 70,883
Notes receivable 1,370 205
Inventories 78,618 58,003
</TABLE>
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<TABLE>
<S> <C> <C>
Prepaid expenses and
other assets 19,517 12,329
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Total currents assets 203,915 229,565
Property and equipment, net 45,868 32,313
Deferred income taxes 12,927 1,697
Goodwill and other assets 58,332 41,946
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$321,042 $305,521
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 27,570 $ 38,043
Accrued employee benefits 4,165 3,930
Other accrued liabilities 6,260 6,255
Income taxes payable 5,756 6,409
Notes payable 38,693 293
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Total current liabilities 82,444 54,930
Long term debt 102,643 101,690
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Minority interest -- 604
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Stockholders' equity:
Common stock 4 4
Additional paid-in capital 135,248 131,735
Retained earnings 1,477 18,380
Cumulative translation adjustment (774) (1,822)
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Total stockholders' equity 135,955 148,297
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$321,042 $305,521
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Contact:
P-Com Inc.
Michael Sophie (CFO)
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Karl Spurzem (Director, IR), 408/866-3666
