Revenues for the six months ended June 30, 2001 were $72.2 million, up 12% from the $64.4 million posted for the same period in 2000.
Net income for the second quarter of 2001 was $0.7 million compared to $3.6 million for the second quarter of 2000. Net income from operations for the six months ended June 30, 2001, was $3.8 million compared to $16.5 million for the same period in 2000.
Basic and fully diluted earnings per share in the second quarter were $0.03 (on 20.5 and 20.6 million shares, respectively) compared to basic earnings per share of $0.18 (on 20.4 million shares) and fully diluted earnings per share of $0.16 (on 22.7 million shares) for the second quarter of last year. Earnings per share for the six months ended June 30, 2001, were $0.18 per basic and fully diluted share (on 20.5 million shares and 20.9 million shares respectively) compared to $0.81 per basic share and $0.72 per fully diluted share (on 20.3 million shares and 22.7 million shares respectively) for the same period in the prior year.
C. Thomas Faulders III, chairman and chief executive officer said, In a time when our industry is experiencing slow downs related to equipment delays and tight capital markets coupled with, in our own case, the wind down of our XM Satellite Radio contract, our number one priority is to be profitable and generate positive cash flow. We are pleased to report higher than anticipated profitability and positive cash flow from operations.
The Company experienced several gains and charges in the second quarter that are detailed in the attached management’s discussions and analysis. These include a $4.9 million recovery from Pocket Communications that the Company took a charge for in 1997, a revised estimate to complete on a fixed price contract in Egypt, employee-related tax adjustments, severance costs and bad debt expenses.
Mr. Faulders continued by saying, One of the larger adjustments we faced during the quarter was to Click-Vodafone of Egypt. Due to network and certain regulatory considerations experienced by Click, the number of sites we were given to build in the quarter was reduced. From discussions with the client, we expect this to be a temporary slowdown and are now seeing site counts return to normal levels. Unfortunately this resulted in both a reduction of quarterly revenues from the client as well as the need to increase our cost estimates to complete this part of the contract.
As previously stated, the Company anticipates revenues for the year 2001 will be between $125 and $130 million with earnings per share between $0.09 and $0.11 excluding adjustments. The Company expects that revenue in the third and fourth quarters will decline compared to the second quarter as a result of the continued wind down of the Company’s XM Satellite Radio contract, the soft fixed wireless sector/market and 3G market delays.
Mr. Faulders concluded, Although we still expect the second half of the year to represent a continued reduction in revenues and profit due to market pressures, we are seeing catalysts that indicate early 2002 as the beginning of the rebound for the wireless infrastructure sector. Until that time, however, we are aggressively targeting those wireless carriers who are continuing to expand and upgrade their networks with new and innovative solutions.
