Wescam revenues drop in first quarter

3/8/01

Burlington, Ont. - Mobile camera manufacturer Wescam says first quarter revenues are down over $5 million from the year before.

Consolidated net revenue was $29.1 million for the first quarter of fiscal 2001, compared with $34.5 million for the first quarter of fiscal 2000.

The company blamed the lower numbers to timing of deliveries and contract awards for certain government system programs, and lower commercial systems service revenue due to the absence of periodic events such as the America's Cup which occurred in the first quarter of fiscal 2000.

Gross profit as a percentage of revenue improved to 33.8 in the first quarter of fiscal 2001 from 30.0 in the same quarter for fiscal 2000. EBITDA (earnings before interest, taxes, depreciation and amortization) for the first quarter of fiscal 2001 was $2.1 million versus EBITDA for the prior year's first quarter of $3.1 million.

"Our first quarter results are in line with our historical seasonality, and we continue to expect strong performance in the second half of the year. We anticipate revenue growth in the 15 per cent range and net earnings growth in the 20 per cent range for fiscal 2001," said Mark Chamberlain, president and CEO, Wescam.

During the quarter, Wescam was awarded its first contract for its new digital wireless transmission system from FOX Sports Production, Inc. The company's Commercial Systems Division, through its broadcast sports subsidiary, signed a three-year $14 million contract to provide its new proprietary mobile digital wireless technology and in-car cameras to capture and transmit video images in real-time at 34 NASCAR racing events each year. FOX will exclusively use Wescam technology and has options for additional coverage. The total potential revenue, if all options were exercised, is $17 million.

Wescam's new wireless system was successfully introduced at the Daytona 500 in February 2001 and it believes that the system will create more demand for mobile digital wireless video technology in other sports applications.






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