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California Amplifier Reports FY 2004 Second Quarter Results

10/02/03

* Sales increase 30% from preceding quarter

* Company returns to profitability in fiscal second quarter

CAMARILLO, Calif., Oct. 2 /PRNewswire-FirstCall/ -- California Amplifier, Inc. (Nasdaq: CAMP) today reported results for its second quarter ended August 31, 2003.

Sales for the second quarter of fiscal 2004 were $24.2 million, compared to $18.6 million for the first quarter of fiscal year 2004 and $27.5 million for the second quarter of the prior year. Net income for the second quarter was $390,000, or $0.03 per diluted share, compared to a net loss of $1.1 million, or ($0.07) per diluted share in the previous quarter, and net income of $1.8 million, or $0.12 per diluted share, in the second quarter of last year.

For the six months ended August 31, 2003 sales were $42.8 million, compared to $50.0 million in the prior year. The net loss during the first six months of fiscal year 2004 was $712,000, or ($0.05) per diluted share, compared to net income of $3.3 million, or $0.22 per diluted share, in the first six months of fiscal year 2003.

Fred Sturm, President and Chief Executive Officer commented, "Our Satellite Products business has experienced a dramatic improvement in recent months. Market activity with our key customers has increased substantially, driven primarily by their promotional programs and seasonal demand entering the holiday season. In order to satisfy our customers' higher volume requirements, we are rapidly ramping up our production capability, thereby reversing the contraction which occurred in the first quarter. However, we are incurring additional costs as a result of this ramp-up, principally due to the expedited procurement of materials."

Mr. Sturm continued, "In our Wireless Access business the development of Ecco(TM), our PCS repeater product, is progressing well. A small number of pre-production units have already been supplied to a major wireless service provider for testing and evaluation purposes. We are also in discussion with other prospective customers who have expressed interest in the potential of our economical, integrated repeater design to improve in-building wireless coverage and increase subscriber satisfaction."

Mr. Sturm also noted, "Based on our current visibility, we estimate third quarter sales in the range of $30 to $36 million and earnings in the range of $0.07 to $0.12 per diluted share. The range of expectations reflects the fact that results for the third quarter will depend to a large degree on the Company's ability to economically procure materials in sufficient quantities to fulfill existing orders."

About California Amplifier, Inc.

California Amplifier designs, manufactures and markets a broad line of integrated microwave equipment used primarily in conjunction with satellite television and terrestrial wireless broadband and video applications. The Company's Satellite business unit designs and markets outdoor reception equipment for the U.S. Direct Broadcast Satellite (DBS) television market as well as a broad line of consumer and commercial satellite products for video and data reception. The Wireless Access business unit designs and markets integrated reception and two-way transmission fixed wireless equipment for broadband data and video applications. California Amplifier is an ISO 9001 certified company. For additional information, visit California Amplifier's web site at www.calamp.com.

Statements in this release about the Company's future financial performance, customer relationships, initiatives to develop innovative wireless solutions, and the market potential of new products are forward-looking statements and are subject to risks and uncertainties that could cause actual results to differ materially from expectations. Words such as "may," "will," "expects," "intends," "plans," "believes," "seeks," "could," "estimate" and variations of these words and similar expressions are intended to identify forward-looking statements. Factors that could impact California Amplifier's future results include changes in product demand and market growth rates, the effect of competition, pricing pressures, supplier constraints, manufacturing yields, market acceptance of new products and the viability and market acceptance of new technologies. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be attained. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. More information about California Amplifier's risks is available in the Company's annual report on Form 10-K and other filings made from time to time with the Securities and Exchange Commission.

     For more information, contact:
     Crocker Coulson                    Rick Vitelle
     Partner                            Chief Financial Officer
     CCG Investor Relations             California Amplifier, Inc.
     (818) 789-0100                     (805) 987-9000
     crocker.coulson@ccgir.com


                            CALIFORNIA AMPLIFIER, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                (Unaudited, in thousands except per share amounts)

                                         Three Months Ended  Six Months Ended
                                              August 31,        August 31,
                                            2003     2002     2003     2002

    Sales                                 $24,197  $27,526  $42,763  $50,008

    Cost of goods sold                     20,997   21,171   38,257   37,809

    Gross profit                            3,200    6,355    4,506   12,199

    Operating expenses:
      Research and development              1,236    1,723    2,598    3,424
      Selling                                 549      744    1,043    1,474
      General and administrative              869    1,052    1,713    2,102
                                            2,654    3,519    5,354    7,000

    Operating income (loss)                   546    2,836     (848)   5,199

    Non-operating expense, net               (129)     (79)    (182)     (80)

    Income (loss) before income taxes         417    2,757   (1,030)   5,119

    Income tax (provision) benefit            (27)    (939)     318   (1,835)

    Net income (loss)                        $390   $1,818    $(712)  $3,284

    Net income (loss) per share:
      Basic                                 $0.03    $0.12   $(0.05)   $0.23
      Diluted                               $0.03    $0.12   $(0.05)   $0.22

    Shares used in per share calculations:
      Basic                                14,747   14,720   14,746   14,547
      Diluted                              14,916   14,914   14,746   14,835


    Business Segment Sales Information:
                                        Three Months Ended  Six Months Ended
                                              August 31,        August 31,
                                            2003     2002     2003     2002
      Satellite Products                  $22,022  $24,640  $38,643  $44,114
      Wireless Access Products              2,175    2,886    4,120    5,894

        Total sales                       $24,197  $27,526  $42,763  $50,008


                           CALIFORNIA AMPLIFIER, INC.
                           CONSOLIDATED BALANCE SHEETS
                                 (In thousands)

                                             August 31,        February 28,
                                                2003               2003
                                            (unaudited)

    Current assets:
      Cash and cash equivalents                $23,080           $21,947
      Accounts receivable, net                  12,884            16,053
      Inventories                               11,700            12,862
      Deferred income tax assets                 2,846             1,130
      Prepaid expenses and other current
       assets                                    1,387             1,100

           Total current assets                 51,897            53,092

    Property, plant and equipment, net           7,550             9,322

    Deferred income tax assets, less
     current portion                             3,973             5,400

    Goodwill, net                               20,938            20,938

    Other assets                                   980               845

                                               $85,338           $89,597

    Current liabilities:
      Current portion of long-term debt         $3,438            $3,005
      Accounts payable                          11,105            11,553
      Accrued payroll and employee
       benefits                                    823             1,649
      Other accrued liabilities                  1,238             2,198

          Total current liabilities             16,604            18,405

    Long-term debt, less current portion        10,835            12,569

    Stockholders' equity:
      Common stock                                 147               147
      Additional paid-in capital                43,453            43,441
      Retained earnings                         15,124            15,836
      Accumulated other comprehensive
       loss                                       (825)             (801)

          Total stockholders' equity            57,899            58,623

                                               $85,338           $89,597


SOURCE California Amplifier, Inc.

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