7/23/2003 - Spectrum Signal Processing Inc. (NASDAQ: SSPI / TSX: SSY) a leading provider of high performance wireless signal processing and packet-voice solutions, announced its financial results for the second quarter ended June 30, 2003. Spectrum reports all results in U.S. dollars and in accordance with U.S. GAAP.
For the quarter ended June 30, 2003, Spectrum recorded sales of $4.1 million, down 28% from the prior quarter and down 35% from sales of $6.3 million in the second quarter of 2002. Wireless Systems sales were $2.2 million for the second quarter of 2003. Wireless Systems sales reflect a $1.9 million decline in legacy product sales from the first quarter. Network Solutions sales were $1.9 million for the second quarter of 2003, an increase of $1.5 million over the first quarter as a result of production volume shipments to UTStarcom.
Spectrum recorded a loss of $2.5 million, or a loss of $0.17 per share, for the quarter ended June 30, 2003, compared to breakeven earnings in the prior quarter, and net earnings of $81,000 or $0.1 per share for the second quarter of 2002.
Spectrum’s gross margin was 42% in the second quarter of 2003, compared to 62% in the prior quarter and 58% in the second quarter of 2002. The decline in gross margin was the result of product mix, and a high proportion of development system sales to new customers involving the resale of lower margin third party products. Gross margins for both Wireless Systems and Network Solutions were 42% in the second quarter of 2003. The margins for Spectrum’s internally developed products remained consistent with those realized in the first quarter.
Spectrum’s cash position at June 30, 2003 stood at $2.6 million, down from $2.8 million in the previous quarter. Given weak second quarter sales and based on internal forecasts, Spectrum expects its cash position to decline over the third quarter, but expects a positive cash balance at the end of the quarter.
“We are looking forward to improving results in the third quarter as we expect revenues in the second half of the year to strengthen. As reflected in our guidance issued July 14, 2003, annual revenues are expected to range from $23 million to $27 million,” stated Pascal Spothelfer, Spectrum’s President and CEO. “Notwithstanding our initiative to pursue strategic alternatives, we are driving our business forward and are experiencing full support from our customers, suppliers, and partners.”
Spectrum will conduct a conference call and live audio web cast on July 21, 2003 at 4:30 pm Eastern / 1:30 pm Pacific time. The call can be accessed by dialing 1.800.273.9672, or by accessing the audio web cast from Spectrum’s web site at www.spectrumsignal.com. A replay of the call will be available from July 21, 2003 to July 28, 2003 and can be accessed by dialing 1.416.695.5800 followed by the access code 1443417, or by visiting www.spectrumsignal.com.
About Spectrum Signal Processing Inc.
Spectrum Signal Processing designs, develops and markets high performance wireless signal processing and packet-voice processing subsystems for use in communications infrastructure equipment. Spectrum’s optimized hardware, software and chip technology work together to collect, compress and convert voice and data signals. Leveraging its 16 years of design expertise, Spectrum provides its customers with faster time to market and lower costs by delivering highly flexible, reliable and high-density solutions. Spectrum subsystems are targeted for use in defense communications systems, satellite hubs, cellular base stations, media gateways and next-generation voice and data switches. More information on Spectrum and its aXs and flexComm product lines is available at www.spectrumsignal.com.
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