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California Amplifier Reports FY 2005 First Quarter Results

07/13/04
* Q1 Revenues up 140% from Prior Year to $45 Million * Q1 Net Income Improves $2.4 Million from Prior Year

OXNARD, Calif., Jul 13, 2004 /PRNewswire-FirstCall via COMTEX/ -- California Amplifier, Inc. (Nasdaq: CAMP) today reported results for its first quarter ended May 31, 2004.

Revenue for the first quarter of fiscal 2005 was $45.0 million, compared to $18.6 million for the first quarter of the prior year. The period over period increase in revenue is due primarily to the improvement in the satellite product sales which began late in the Company's fiscal 2004 second quarter. Net income for the first quarter was $1.3 million, or $0.07 per diluted share, compared to a net loss of $1.1 million, or $0.07 per diluted share for the first quarter of fiscal year 2004.

Fred Sturm, President and Chief Executive Officer, commented, "CalAmp is in the early stages of re-defining the Company beyond its historical set of customers and markets. Integration of the Vytek business is well underway and we are actively pursuing opportunities which will capitalize on our combined strengths in RF and embedded software design, development and manufacturing to provide a complete content delivery or communication solution. The newly formed Solutions Division had revenues of $4.5 million for the seven week period included in this quarter. The Solutions Division experienced a loss of approximately $1.5 million during this period including pre-tax charges arising from the acquisition for writing off in-process research and development of $471,000 and an intangible asset amortization expense of $234,000. We anticipate that with the major elements of the integration effort being concluded during the second quarter we will begin to see improving operational contribution from this segment of our business during the second half of our fiscal year. I am also pleased to report that the consolidation of Vytek's product manufacturing operation into CalAmp's Ventura County facility is substantially ahead of plan and expected to be completed in July which should further help to reduce costs going forward."

Mr. Sturm added, "During the quarter we continued to make progress in two key product developments. Beta testing of our "Directed AP" product for the enterprise WiFi Access Point market is expected to begin during August. Also, customer testing is underway of our satellite product targeted to support improved Digital Video Recorder market penetration by one of our major customers. This product, which substantially reduces the cost and complexity of installation of Digital Video Recorders, is undergoing set top box compatibility and stress testing. These tests are expected to be complete in August, with production starting in our fiscal third quarter."

Mr. Sturm also noted, "Based on our current visibility, we estimate fiscal 2005 second quarter revenues in the range of $48 to $55 million and earnings in the range of $0.05 to $0.09 cents per diluted share. Included in these estimates are charges of $434,000 for amortization of intangible assets."

About CalAmp

CalAmp is a leading provider of wired and wireless communication solutions with comprehensive capabilities ranging from product design and consulting services through high volume manufacturing and support. CalAmp is a trusted partner delivering cost-effective, high quality solutions to a broad array of customers and markets including direct broadcast satellite (DBS), digital multimedia content delivery, health care, retailing, public safety, and both residential and enterprise connectivity. The Company is headquartered in Ventura County, California and has approximately 800 employees. Founded in 1981, CalAmp has been publicly traded since 1983 as NASDAQ: CAMP.

Forward Looking Statement

Statements in this press release that are not historical in nature are forward-looking statements, which involve known and unknown risks and uncertainties. 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. Actual results could differ materially from those implied by such forward-looking statements due to a variety of factors, including, general and industry economic conditions, competition, development factors, operating costs, the Company's ability to integrate the Vytek acquisition successfully and other risks and uncertainties that are detailed from time to time in the Company's filings with the Securities and Exchange Commission. 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.

     For more information, contact:
     Crocker Coulson
     Partner
     CCG Investor Relations
     (818) 789-0100
     crocker.coulson@ccgir.com

     Rick Vitelle
     Chief Financial Officer
     CalAmp
     (805) 987-9000


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

                                                       Three Months Ended
                                                             May 31,
                                                      2004              2003

     Revenue                                        $44,997           $18,566

     Cost of revenue                                 36,696            17,260

     Gross profit                                     8,301             1,306

     Operating expenses:
       Research and development                       1,807             1,362
       Selling                                        1,072               494
       General and administrative                     2,445               844
       Intangible asset amoritization                   260                --
       In-process research and development              471                --
                                                      6,055             2,700

     Operating income (loss)                          2,246            (1,394)

     Non-operating expense, net                         (64)              (53)

     Income (loss) before income taxes                2,182            (1,447)

     Income tax (provision) benefit                    (873)              345

     Net income (loss)                               $1,309           $(1,102)

     Net income (loss) per share:
       Basic                                          $0.07            $(0.07)
       Diluted                                        $0.07            $(0.07)

     Shares used in per share
      calculations:
       Basic                                         18,755            14,745
       Diluted                                       19,750            14,745

     Business Segment Revenue Information (1)

                                                       Three Months Ended
                                                             May 31,
                                                      2004              2003
       Products Division                            $40,499           $18,566
       Solutions Division                             4,498                --

         Total sales                                $44,997           $18,566


     (1)  Effective with the acquisition of Vytek Corporation on April 12,
          2004, California Amplifier realigned its operations into a
          divisional structure in which CalAmp's existing Satellite and
          Wireless Access businesses were combined, together with Vytek's
          products manufacturing business, into a new Products Division.  The
          remainder of Vytek's operations, consisting principally of revenues
          generated by professional engineering services and the development
          of software applications, comprise the new Solutions Division.


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

                                                     May 31,      February 28,
                                                      2004           2004
                                                  (unaudited)

     Current assets:
       Cash and cash equivalents                     $23,640        $22,885
       Accounts receivable, net                       20,931         18,579
       Inventories                                    23,408         20,253
       Deferred income tax assets                      3,018          2,404
       Prepaid expenses and other current
        assets                                         5,130          3,244

            Total current assets                      76,127         67,365

     Equipment and improvements, net                   5,309          4,381

     Deferred income tax assets, less
      current portion                                  2,936          4,359

     Goodwill                                        100,562         20,938

     Other intangible assets, net                      5,261            200

     Other assets                                      2,455            399

                                                    $192,650        $97,642

     Current liabilities:
       Current portion of long-term debt              $3,774         $3,603
       Accounts payable                               20,570         17,395
       Accrued payroll and employee benefits           3,403          1,513
       Other current liabilities                       4,517          2,078
       Deferred revenue                                1,075             --

           Total current liabilities                  33,339         24,589

     Long-term debt, less current portion              9,077          7,690

     Stockholders' equity:
       Common stock                                      231            149
       Additional paid-in capital                    137,539         44,486
       Common stock held in escrow                    (9,594)            --
       Retained earnings                              22,859         21,550
       Accumulated other comprehensive
        loss                                            (801)         (822)

          Total stockholders' equity                 150,234         65,363

                                                    $192,650        $97,642

SOURCE California Amplifier, Inc.

Crocker Coulson of CCG Investor Relations, +1-818-789-0100,
crocker.coulson@ccgir.com, for California Amplifier, Inc.; or Rick Vitelle,
Chief Financial Officer of California Amplifier, Inc., +1-805-987-9000
http://www.calamp.com
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