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California Amplifier Reports FY 2004 Third Quarter Results


* Company generates record sales of $44.2 million in latest quarter

* Q3 diluted EPS of 22 cents, up from 6 cents a year ago

CAMARILLO, Calif., Dec. 23 /PRNewswire-FirstCall/ -- California Amplifier, Inc. (Nasdaq: CAMP) today reported results for its third quarter ended November 30, 2003.

Sales for the third quarter of fiscal 2004 were $44.2 million, compared to $24.2 million for the immediately preceding quarter and $24.0 million for the third quarter of the prior year. Net income for the third quarter was $3.5 million, or $0.22 per diluted share, compared to net income of $391,000, or $0.03 per diluted share in the immediately preceding quarter, and net income of $905,000, or $0.06 per diluted share, in the third quarter of last year.

"We are pleased with our overall performance during the third quarter, during which we successfully responded to the substantial increase in market demand for our satellite television reception products," stated Fred Sturm, President and Chief Executive Officer. "Our third quarter revenue, which increased over 80% on both a sequential quarter and prior year basis, represents a record level for our Company, greatly surpassing the previous record for quarterly revenue of $32.8 million set two years ago. The performance in the latest quarter was made possible by the outstanding efforts of our employees and our supply chain partners."

Mr. Sturm continued, "In addition to increased market demand, our record revenues in the third quarter were the result of higher average selling prices on our latest generation satellite television products. We remain encouraged by the continued growth in subscriber base by the U.S. satellite television providers, and we are continuing our efforts to support their product requirements."

For the nine months ended November 30, 2003 sales were $87.0 million, compared to $74.0 million in the prior year. Net income for the first nine months of fiscal year 2004 was $2.7 million, or $0.18 per diluted share, compared to net income of $4.2 million, or $0.28 per diluted share, in the first nine months of fiscal year 2003. Net income for the latest nine month period is down from the prior year because of manufacturing inefficiencies associated with substantial quarter-to-quarter changes in customer demand and production volume, material expedite costs associated with the significant ramp-up in production volume beginning in the second quarter, and increased competitive pricing pressures in the Satellite products business.

Mr. Sturm also noted, "Based on our current visibility, we estimate fourth quarter sales in the range of $40 to $48 million and earnings in the range of $0.18 to $0.24 per diluted share."

As separately announced today, the Company has entered into an agreement to acquire Vytek Corporation, a privately-held company engaged in providing software and hardware solutions and services that enable wired and wireless access to information.

Conference Call

The Company will conduct a conference call to discuss its third quarter results and the planned acquisition of Vytek, Inc. on Tuesday, December 23, 2003 at 1:30 p.m., Pacific Time that will be available as a live audio webcast at Company's web site, , or on the web site under the Multimedia News section. Both links require listeners to install either RealPlayer or Windows Media Player to access the event. A replay of the audio broadcast will be available for 14 days after the call's completion.

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 .

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
     CCG Investor Relations
     (818) 789-0100

     Rick Vitelle
     Chief Financial Officer
     California Amplifier, Inc.
     (805) 987-9000

                               [TABLES FOLLOW]

                            CALIFORNIA AMPLIFIER, INC.
                (Unaudited, in thousands except per share amounts)

                                    Three Months Ended      Nine Months Ended
                                       November 30,            November 30,
                                       2003      2002         2003     2002
    Sales                            $44,248   $23,965      $87,011   $73,973
    Cost of goods sold                37,514    19,587       75,771    57,396
    Gross profit                       6,734     4,378       11,240    16,577
    Operating expenses:
      Research and development         1,338     1,391        3,936     4,815
      Selling                            627       469        1,670     1,943
      General and administrative         925       902        2,638     3,004
                                       2,890     2,762        8,244     9,762

    Operating income                   3,844     1,616        2,996     6,815
    Non-operating expense, net           (12)      (79)        (194)     (159)
    Income before income taxes         3,832     1,537        2,802     6,656
    Income tax provision                (380)     (632)         (62)   (2,467)
    Net income                        $3,452      $905       $2,740    $4,189
    Net income per share:
      Basic                            $0.23     $0.06        $0.19     $0.29
      Diluted                          $0.22     $0.06        $0.18     $0.28

    Shares used in per share
      Basic                           14,788    14,720       14,760    14,605
      Diluted                         15,555    14,850       15,128    14,840

    Business Segment Sales Information:

                                    Three Months Ended      Nine Months Ended
                                       November 30,            November 30,
                                       2003      2002         2003      2002
      Satellite Products             $42,607   $20,443      $81,250   $64,557
      Wireless Access Products         1,641     3,522        5,761     9,416
        Total sales                  $44,248   $23,965      $87,011   $73,973

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

                                            November 30,      February 28,
                                                2003              2003
    Current assets:
      Cash and cash equivalents               $25,286           $21,947
      Accounts receivable, net                 17,399            16,053
      Inventories                              13,875            12,862
      Deferred income tax assets                2,576             1,130
      Prepaid expenses and other current
       assets                                     935             1,100
           Total current assets                60,071            53,092
    Property, plant and equipment, net          7,887             9,322
    Deferred income tax assets, less
     current portion                            4,098             5,400
    Goodwill, net                              20,938            20,938
    Other assets                                  668               845
                                              $93,662           $89,597

    Current liabilities:
      Current portion of long-term debt        $3,375            $3,005
      Accounts payable                         15,671            11,553
      Accrued payroll and employee
       benefits                                 1,311             1,649
      Other accrued liabilities                 1,488             2,198
           Total current liabilities           21,845            18,405
    Long-term debt, less current portion        9,874            12,569

    Stockholders' equity:
      Common stock                                148               147
      Additional paid-in capital               44,024            43,441
      Retained earnings                        18,576            15,836
      Accumulated other comprehensive
        loss                                     (805)             (801)
           Total stockholders' equity          61,943            58,623
                                              $93,662           $89,597

SOURCE California Amplifier, Inc.

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