Revenue in Q2'22 was $188.0 million and
Adjusted EBITDA was $22.4 million
Sierra Wireless, Inc. (NASDAQ: SWIR) (TSX: SW) reported results
for its second quarter of 2022. All results are reported in U.S.
dollars and are prepared in accordance with United States generally
accepted accounting principles ("U.S. GAAP" or "GAAP"), except as
otherwise indicated below.1
Second Quarter 2022 Compared to Second Quarter 2021
- Revenue was $188.0 million, an increase of 41.5% compared to
the second quarter of 2021. The increase was primarily due to
strong demand and the realization of investments in inventory to
combat the ongoing supply chain tightness.
- Gross margin was 33.6% as compared to 34.8% in the second
quarter of 2021. In the second quarter of 2022, gross margin was
impacted by product mix and higher component costs.
- Operating expenses were $44.6 million compared to $55.6 million
in the second quarter of 2021. Second quarter expenses included a
$9.2 million gain on sale of our Omnilink offender monitoring
business.
- Net earnings from continuing operations was $10.9 million,
compared to a net loss $10.0 million in the second quarter of
2021.
- Adjusted earnings from continuing operations* was $16.7
million, or basic adjusted earnings from continuing operations* of
$0.43 per share, as compared to a loss of $1.1 million, or loss of
$0.03 per share in the second quarter of 2021.
- Adjusted EBITDA* was $22.4 million compared to $4.3 million in
the second quarter of 2021.
- Connectivity, software, and services revenue was $31.4 million,
a decrease of 10.7% compared to the second quarter of 2021. This
decrease was primarily due to the sale of the Omnilink offender
monitoring business and the impact of the shutdown of 2G/3G
networks in the United States on our home security business.
- Monthly recurring revenue ("MRR")2, 3 was $9.1 million in June
2022 compared to $9.3 million in June 2021.
Segmented Information
IoT Solutions
Revenue from IoT Solutions increased 54.7% to $139.7 million as
compared to $90.3 million in the second quarter of 2021. The
increase was primarily due to strong demand for connected devices
globally and the realization of investments in inventory to combat
the ongoing supply chain tightness. Increase in demand includes
acceleration in IoT modules deployment across our industrial
customers. IoT Solutions gross margin was 30.1%, compared to 27.0%
in the second quarter of 2021. The increase in gross margin was
primarily due to price increases, product mix, and improved
absorption of fixed costs from increased volume.
Enterprise Solutions
Revenue from Enterprise Solutions increased 13.6% to $48.3
million as compared to $42.5 million in the second quarter of 2021.
The increase was primarily due to strong demand for routers in our
key industrial and public safety verticals, partially offset by
decline in connectivity, software, and services revenue resulting
from the sale of the Omnilink offender monitoring business and the
impact of the shutdown of 2G/3G networks in the United States on
our home security business. Enterprise Solutions gross margin was
43.9% as compared to 51.3% in the second quarter of 2021. The
decrease in gross margin was primarily due to product mix and
higher component costs.
Liquidity and Capital Resources
Cash and cash equivalents and restricted cash at the end of the
second quarter of 2022 were $127.4 million, an increase of $30.0
million from the first quarter of 2022. The increase in cash was
primarily driven by proceeds received from the sale of our Omnilink
offender monitoring business.
Acquisition by Semtech Corporation
On August 2, 2022, we entered into a definitive agreement (the
"Arrangement Agreement") with Semtech Corporation and a subsidiary
of Semtech Corporation (the "Purchaser") pursuant to which the
Purchaser will acquire all of the outstanding shares of Sierra
Wireless (the "Transaction"). Under the terms of the Transaction,
Sierra Wireless shareholders will receive $31 in cash per share (in
U.S. dollars).
The Transaction, which is not subject to any financing
conditions, will be carried out by way of a court-approved plan of
arrangement under the Canada Business Corporations Act and will
require the approval of at least (1) 66⅔% of the votes cast by
Sierra Wireless shareholders, and (2) 66⅔% of the votes cast by
Sierra Wireless security holders (comprised of shareholders,
optionholders, restricted share unit holders and performance share
unit holders), at a special meeting expected to be held to consider
the Transaction. In addition to such approval by Sierra Wireless
shareholders and security holders, the Transaction is also subject
to court approval and regulatory approvals, including approval
under the Canadian Competition Act and the United States
Hard-Scott-Rodino Antitrust Improvements Act of 1976. Subject to
the satisfaction of such conditions, the Transaction is expected to
be completed by early 2023.
Disposition of Offender Monitoring Business Line
On April 15, 2022, we signed a definitive agreement and closed
the sale of our Omnilink offender monitoring business to Sentinel
Advantage LLC for $37.6 million in cash, subject to customary
working capital adjustments. Sentinel continues to be an important
customer, and we are providing them with embedded modules and
connectivity services for their offender monitoring products. The
divestiture allows the Company to focus on its core businesses and
strengthen its balance sheet.
_____________________________
1 Non-GAAP financial measures referred to in this news release
are labeled as "non-GAAP measure" or designated as such with an
asterisk (*). Please see "Non-GAAP Financial Measures" for
explanations of why the Company uses these non-GAAP measures and
"Reconciliation of GAAP and Non-GAAP Results by Quarter" for
reconciliation to the most comparable GAAP financial measures.
2 MRR is defined as the monthly recurring
revenue generated from connectivity, software, and services as well
as usage fees from current customers. MRR is a key performance
metric to measure our performance and growth in our recurring
revenue, both to help investors better understand and assess the
performance of our business and also because our mix of revenue
generated from recurring sources has increased in recent years. MRR
does not have any standardized meaning and is therefore unlikely to
be comparable to similarly titled measures presented by other
companies. MRR should be viewed independently of revenue and
deferred revenue and is not intended to be combined with or to
replace either of those items. MRR is not a forecast.
3 Following the sale of our Omnilink
offender monitoring business in the second quarter of 2022 and the
decision to not develop additional products for our home security
business in light of the shutdown of 2G/3G networks in the United
States in the first quarter of 2022, revenues from these businesses
have been excluded from MRR for the current and prior periods.
4 In accordance with U.S. GAAP, the
results of operations of the Automotive Business are reported as
discontinued operations in our consolidated statements of
operations and comprehensive loss for the three and six months
ended June 30, 2022 and 2021.
Non-GAAP Financial Measures
Our consolidated financial statements are prepared in accordance
with U.S. GAAP on a basis consistent for all periods presented. In
addition to results reported in accordance with U.S. GAAP, we use
non-GAAP financial measures as supplemental indicators of our
operating performance. The term “non-GAAP financial measure” is
used to refer to a numerical measure of a company’s historical or
future financial performance, financial position or cash flows
that: (i) excludes amounts, or is subject to adjustments that have
the effect of excluding amounts, that are included in the most
directly comparable measure calculated and presented in accordance
with U.S. GAAP in a company’s statement of earnings, balance sheet
or statement of cash flows; or (ii) includes amounts, or is subject
to adjustments that have the effect of including amounts, that are
excluded from the most directly comparable measure so calculated
and presented.
Our non-GAAP financial measures included in this press release
are adjusted net earnings (loss) from continuing operations*, basic
and diluted adjusted earnings (loss) per share from continuing
operations* and adjusted EBITDA* (earnings before interest, taxes,
depreciation and amortization).
Adjusted net earnings (loss) from continuing operations*
excludes the impact of stock-based compensation expense and related
social taxes, phantom RSU expense which represents expenses related
to compensation units settled in cash based on the stock price at
vesting, restructuring costs, government grants related to COVID-19
relief, CEO retirement/search, impairment, gain on sale of
Omnilink, the ransomware incident, COVID-19 factory constraint
incremental costs, certain other non-recurring costs or recoveries,
acquisition-related amortization, the impact of foreign exchange
gains or losses on translation of certain balance sheet accounts,
unrealized foreign exchange gains or losses on forward contracts,
recognition of cumulative translation adjustments on dissolution of
subsidiaries, and certain tax adjustments.
Adjusted EBITDA* is defined as net earnings (loss) from
continuing operations plus stock-based compensation expense and
related social taxes, phantom RSU expense which represents expenses
related to compensation units settled in cash based on the stock
price at vesting, restructuring costs, government grants related to
COVID-19 relief, CEO retirement/search, impairment, gain on sale of
Omnilink, the ransomware incident, COVID-19 factory constraint
incremental costs, certain other non-recurring costs or recoveries,
amortization, interest and other income (expense), foreign exchange
gains or losses on translation of certain balance sheet accounts,
unrealized foreign exchange gains or losses on forward contracts,
recognition of cumulative translation adjustments on dissolution of
subsidiaries, and income tax expense (recovery). Adjusted EBITDA*
is a metric used by investors and analysts for valuation purposes
and is an important indicator of our operating performance and our
ability to generate liquidity through operating cash flow that will
fund future working capital needs and fund future capital
expenditures.
We use the above-noted non-GAAP financial measures for planning
purposes and to allow us to assess the performance of our business
before including the impacts of the items noted above as they
affect the comparability of our financial results. These non-GAAP
measures are reviewed regularly by management and the Board of
Directors as part of the ongoing internal assessment of our
operating performance.
We disclose these non-GAAP financial measures as we believe they
provide useful information to investors and analysts to assist them
in their evaluation of our operating results and to assist in
comparisons from one period to another. Readers are cautioned that
non-GAAP financial measures do not have any standardized meaning
prescribed by U.S. GAAP and therefore may not be comparable to
similar measures presented by other companies.
Cautionary Note Regarding Forward-Looking Statements
This press release contains certain statements and information
that are not based on historical facts and constitute
forward-looking statements or forward-looking information within
the meaning of the U.S. Private Securities Litigation Reform Act of
1995 and Canadian securities laws (collectively, “forward-looking
statements”) and may include statements and information relating
to, among others, the consummation of the proposed transaction and
the expected timing thereof, the synergies and other benefits to be
realized if the proposed transaction is consummated; our
expectations regarding customer demand, our supply chain,
manufacturing capacity (including manufacturing shutdowns or
slowdowns) and the potential impact of COVID-19 in these areas; our
ability to meet customer demand and our financial results;
expectations regarding post-COVID-19 recovery; expectations
regarding the Company's cost savings initiatives; statements
regarding our strategy, plans, goals, objectives, expectations and
future operating performance; the Company's liquidity and capital
resources; the Company's financial and operating objectives and
strategies to achieve them; our work to review and evaluate
additional security measures and the ability that they will have to
protect our IT systems; general economic conditions; estimates of
our expenses, future revenues, financial results and capital
requirements; our expectations regarding the legal proceedings we
are involved in; statements with respect to the Company's estimated
working capital; expectations with respect to the adoption of
Internet of Things ("IoT") solutions; expectations regarding trends
and growth in the IoT market and wireless module market;
expectations regarding product and price competition from other
wireless device manufacturers and solution providers; our ability
to implement effective control procedures; and expectations
regarding the launch of fifth generation cellular embedded modules
and gateways. Forward-looking statements are provided to help you
understand our views of our short and long term plans, expectations
and prospects. We caution you that forward-looking statements may
not be appropriate for other purposes.
Forward-looking statements:
- Typically include words and phrases about the future such as
"outlook", "guidance", "will", "may", “expects”, “is expected”,
“anticipates”, “believes”, “plans”, “projects”, “estimates”,
“assumes”, “intends”, “strategy”, “goals”, “objectives”,
“potential”, “possible”, or variations thereof.
- Are not promises or guarantees of future performance. They
represent our current views and may change significantly.
- Are based on a number of material assumptions, including, but
not limited to, those listed below, which could prove to be
significantly incorrect:
- the scope and duration of the COVID-19 pandemic and its impact
on our business;
- our ability to return to normal operations after the COVID-19
pandemic has subsided globally;
- expected constraints on component supply and manufacturing
capacity;
- constraints impacting our ability to receive supply from our
suppliers and deliver product to our customers;
- customer demand and our ability to continue to sell our
products and services in the expected quantities at the expected
prices and expected times;
- our operations not being adversely disrupted by further
ransomware or cyber security attacks;
- our ability to effect and to realize the anticipated benefits
of our business transformation and restructuring initiatives, and
the timing thereof;
- our ability to develop, manufacture, and sell new products and
services that meet the needs of our customers and gain commercial
acceptance;
- expected macro-economic business conditions;
- expected cost of sales;
- our ability to win new business;
- our ability to integrate acquired businesses and realize
expected benefits;
- our ability to renew or obtain credit facilities when
required;
- expected deployment of next generation networks by wireless
network operators;
- our operations not being adversely disrupted by other
developments, operating, cyber security, litigation, or regulatory
risks; and
- expected tax and foreign exchange rates.
- Are based on our management's current expectations and we
caution investors that forward-looking statements, particularly
those that relate to longer periods of time, are subject to
substantial known and unknown material risks and uncertainties.
Many factors could cause our actual results, achievements and
developments in our business to differ significantly from those
expressed or implied by our forward-looking statements, including
without limitation, the following factors. These risk factors and
others are discussed in our Annual Information Form which may be
found on SEDAR at www.sedar.com and on EDGAR at www.sec.gov and in
our other regulatory filings with the Securities and Exchange
Commission in the United States and the provincial securities
commissions in Canada:
- the failure to satisfy the conditions to the closing of the
proposed transaction;
- the failure of the purchaser to obtain financing required to
close the proposed transaction;
- the occurrence of any event, change or other circumstances that
could give rise to the termination of the arrangement agreement,
including the payment of a termination fee;
- the risk that the proposed transaction will not be consummated
within the expected time period, or at all;
- the effect of the proposed transaction on our management,
ability to retain and hire key personnel and maintain business
relationships with customers, suppliers and others with whom they
each do business;
- the effect of the proposed transaction on our ability to
conduct certain activities in the ordinary course of business;
- the failure to obtain regulatory approvals required for the
closing of the proposed transaction, including the approval of the
Supreme Court of British Columbia;
- the effect of the proposed transaction on our ability to pursue
alternative transactions on favourable terms;
- negative impact from COVID-19 could be prolonged and natural
catastrophes could impact our capacity to continue critical
operations;
- our ability to comply with all terms under our credit
facilities;
- competition from new or established competitors or from those
with greater resources;
- our reliance on third party suppliers for certain components
used in our products;
- our dependence on a limited number of third party
manufacturers;
- cyber-attacks or other breaches of our and our vendors'
information technology security;
- the loss of, or significant demand fluctuations from, any of
our significant customers;
- our financial results being subject to fluctuations;
- our business transformation initiatives, including investments
and partnerships, may result in disruptions to our business and may
not achieve the anticipated benefits;
- our ability to respond to changing technology, industry
standards, and customer requirements;
- failures of our products or services due to design flaws and
errors, component quality issues, manufacturing defects, network
service interruptions, cyber-security vulnerabilities or other
quality issues;
- deterioration in macro-economic conditions could adversely
affect our operating results and financial conditions;
- unanticipated costs associated with litigation or
settlements;
- our ability to retain, hire and transition in a timely manner
experienced and qualified additional executive officers and key
employees as needed to achieve our business objectives;
- risks related to the transmission, use and disclosure of user
data and personal information;
- disruption of, and demands on, our ongoing business and
diversion of management's time and attention in connection with
acquisitions or divestitures;
- risks related to infringement on intellectual property rights
of others and our ability to obtain necessary rights to use
software or components supplied by third parties;
- our ability to enforce our intellectual property rights;
- our dependence on mobile network operators to promote and offer
acceptable wireless data services;
- risks related to contractual disputes with counterparties;
- risks related to governmental regulation;
- risks inherent in foreign jurisdictions; and
- risks related to tariffs or other trade restrictions.
About Sierra Wireless
Sierra Wireless (NASDAQ: SWIR) (TSX: SW) is a leading IoT
solutions provider that combines devices, network services, and
software to unlock value in the connected economy. Companies
globally are adopting 4G, 5G, and LPWA solutions to improve
operational efficiency, create better customer experiences, improve
their business models, and create new revenue streams. Sierra
Wireless works with its customers to develop the right
industry-specific solution for their IoT deployments, whether this
is an integrated solution to help connect edge devices to the
cloud, a software/API service to manage processes with billions of
connected assets, or a platform to extract real-time data to
improve business decisions. With more than 25 years of cellular IoT
experience, Sierra Wireless is the global partner customers trust
to deliver them their next IoT solution. For more information,
visit www.sierrawireless.com.
“Sierra Wireless” is a registered trademark of Sierra Wireless.
Other product or service names mentioned herein may be the
trademarks of their respective owners.
SIERRA WIRELESS, INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(In thousands of U.S. dollars,
except where otherwise stated)
(unaudited)
Three months ended June 30,
Six months ended June 30,
2022
2021
2022
2021
Revenue
IoT Solutions
$
139,678
$
90,309
$
273,386
$
164,887
Enterprise Solutions
48,273
42,476
87,522
75,960
187,951
132,785
360,908
240,847
Cost of sales
IoT Solutions
97,665
65,884
190,848
118,376
Enterprise Solutions
27,104
20,670
51,815
38,513
124,769
86,554
242,663
156,889
Gross margin
63,182
46,231
118,245
83,958
Expenses
Sales and marketing
18,115
21,423
36,132
41,244
Research and development
17,296
16,930
35,631
34,414
Administration
11,733
11,097
21,849
27,405
Restructuring
3,715
1,720
7,719
4,294
Impairment
—
—
10,299
—
Gain on sale of Omnilink
(9,179
)
—
(9,179
)
—
Amortization
2,900
4,389
6,720
9,013
44,580
55,559
109,171
116,370
Earnings (loss) from operations
18,602
(9,328
)
9,074
(32,412
)
Foreign exchange (loss) gain
(5,355
)
1,143
(7,633
)
(3,116
)
Other expense
(650
)
(1,246
)
(1,733
)
(1,889
)
Earnings (loss) before income
taxes
12,597
(9,431
)
(292
)
(37,417
)
Income tax expense
1,691
605
2,712
1,157
Net earnings (loss) from continuing
operations
$
10,906
$
(10,036
)
$
(3,004
)
$
(38,574
)
Net earnings (loss) from discontinued
operations
793
85
2,024
(1,237
)
Net earnings (loss)
$
11,699
$
(9,951
)
$
(980
)
$
(39,811
)
Other comprehensive income (loss):
Foreign currency translation adjustments,
net of taxes of $nil
(1,914
)
1,233
(2,340
)
(1,667
)
Comprehensive income (loss)
$
9,785
$
(8,718
)
$
(3,320
)
$
(41,478
)
Basic and diluted net earnings (loss) per
share (in dollars)
Continuing operations
$
0.28
$
(0.27
)
$
(0.08
)
$
(1.05
)
Discontinued operations
0.02
—
0.05
(0.03
)
$
0.30
$
(0.27
)
$
(0.03
)
$
(1.08
)
Weighted average number of shares
outstanding
(in thousands)
Basic
38,770
36,992
38,439
36,865
Diluted
39,079
36,992
38,439
36,865
SIERRA WIRELESS, INC.
CONSOLIDATED BALANCE
SHEETS
(In thousands of U.S. dollars,
except where otherwise stated)
(unaudited)
June 30, 2022
December 31, 2021
Assets
Current assets
Cash and cash equivalents
$
127,343
$
76,784
Restricted cash
77
100
Accounts receivable
104,442
85,310
Inventories
92,357
82,177
Prepaids and other
52,252
27,372
376,471
271,743
Property and equipment, net
25,757
31,134
Operating lease right-of-use assets
11,163
14,348
Intangible assets, net
34,064
54,708
Goodwill
147,646
167,379
Deferred income taxes
1,186
1,268
Other assets
4,154
6,473
$
600,441
$
547,053
Liabilities
Current liabilities
Accounts payable and accrued
liabilities
192,984
183,529
Deferred revenue
12,320
11,770
Current portion of long-term debt
971
494
206,275
195,793
Long-term obligations
38,257
42,808
Operating lease liabilities
13,159
15,033
Long-term debt
55,452
9,394
Deferred income taxes
6,022
6,371
319,165
269,399
Equity
Shareholders’ equity
Common stock: no par value; unlimited
shares authorized; issued and outstanding: 38,940,753 shares
(December 31, 2021 - 37,774,800 shares)
476,011
460,331
Preferred stock: no par value; unlimited
shares authorized;
issued and outstanding: nil shares
—
—
Treasury stock: at cost; 1,026 shares
(December 31, 2021 – 119,761 shares)
(22
)
(2,128
)
Additional paid-in capital
39,678
48,747
Retained deficit
(223,319
)
(220,564
)
Accumulated other comprehensive loss
(11,072
)
(8,732
)
281,276
277,654
$
600,441
$
547,053
SIERRA WIRELESS, INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(In thousands of U.S.
dollars)
(unaudited)
Three months ended June 30,
Six months ended June 30,
2022
2021
2022
2021
Cash flows provided by (used
in):
Operating activities
Net earnings (loss)
$
11,699
$
(9,951
)
$
(980
)
$
(39,811
)
Items not requiring (providing) cash
Amortization
4,741
7,267
11,425
14,575
Stock-based compensation
3,753
3,722
6,819
12,237
Capitalized interest expense
674
—
1,584
—
Impairment
—
—
10,299
—
Gain on sale of Omnilink
(9,179
)
—
(9,179
)
—
Deferred income taxes
1
(3
)
1
(3
)
Unrealized foreign exchange loss
(gain)
5,878
(867
)
7,245
4,161
Recognition of cumulative translation
adjustments on dissolution of subsidiaries
817
—
817
—
Other
27
317
445
337
Changes in non-cash working capital
Accounts receivable
(18,228
)
3,548
(23,954
)
(7,196
)
Inventories
(4,357
)
(12,703
)
(10,852
)
(14,235
)
Prepaids and other
(6,338
)
5,150
(23,278
)
(11,084
)
Accounts payable and accrued
liabilities
13,812
18,541
10,799
5,495
Deferred revenue and other
(687
)
235
(2,323
)
396
Cash flows provided by (used in) operating
activities
2,613
15,256
(21,132
)
(35,128
)
Investing activities
Additions to property and equipment
(5,280
)
(3,972
)
(7,729
)
(8,681
)
Additions to intangible assets
(202
)
(2,502
)
(875
)
(2,922
)
Proceeds from sale of property and
equipment
12
25
23
39
Proceeds from sale of Omnilink, net of
transaction costs and cash sold
34,959
—
34,959
—
Acquisition of M2M New Zealand, net of
cash acquired
—
(319
)
—
(319
)
Cash flows provided by (used in) investing
activities
29,489
(6,768
)
26,378
(11,883
)
Financing activities
Issuance of common shares, net of issuance
cost
1,687
799
2,565
3,601
Purchase of treasury shares for RSU
distribution
(2,443
)
(3,530
)
(2,443
)
(7,463
)
Taxes paid related to net settlement of
equity awards
—
(111
)
—
(1,057
)
Decrease in other long-term
obligations
(35
)
(66
)
(40
)
(102
)
Proceeds from long-term debt, net of
issuance cost
(50
)
—
45,732
—
Cash flows (used in) provided by financing
activities
(841
)
(2,908
)
45,814
(5,021
)
Effect of foreign exchange rate changes on
cash and cash equivalents
(1,282
)
672
(524
)
(906
)
Cash, cash equivalents and restricted
cash, increase (decrease) in the period
29,979
6,252
50,536
(52,938
)
Cash, cash equivalents and restricted
cash, beginning of period
97,441
112,234
76,884
171,424
Cash, cash equivalents and restricted
cash, end of period
$
127,420
$
118,486
$
127,420
$
118,486
SIERRA WIRELESS, INC.
RECONCILIATION OF GAAP AND
NON-GAAP RESULTS BY QUARTER
(in thousands of U.S. dollars, except
where otherwise stated)
2022
2021
2020
Q2
Q1
Q4
Q3
Q2
Q1
Q4
Q3
Net earnings (loss) from continuing
operations - GAAP
$
10,906
$
(13,910
)
$
(11,752
)
$
(38,406
)
$
(10,036
)
$
(28,538
)
$
(11,167
)
$
(14,483
)
Stock-based compensation and related
social taxes
3,758
3,281
5,832
1,820
3,807
7,928
6,461
5,085
Phantom RSU expense (recovery)
157
(202
)
393
(69
)
569
206
691
261
Restructuring
3,715
4,004
7,592
369
1,720
2,574
4,800
3,089
COVID-19 government relief
(22
)
(11
)
(5,557
)
(168
)
(1,016
)
(2,049
)
(954
)
(6,298
)
CEO retirement/search
—
—
44
42
400
1,655
—
—
Impairment
—
10,299
741
11,544
—
—
—
—
Gain on sale of Omnilink
(9,179
)
—
—
—
—
—
—
—
Ransomware incident
(1,089
)
(59
)
(959
)
271
1,135
533
—
—
COVID-19 factory constraint incremental
costs
—
1,096
22
1,135
—
—
—
—
Other non-recurring costs
682
99
978
323
593
508
445
439
Amortization
4,741
6,684
6,935
7,208
7,267
7,308
7,054
8,030
Interest and other expense, net
922
1,142
307
192
111
110
564
988
Foreign exchange loss (gain), net of
realized gain/loss on hedge contracts
5,317
2,326
1,927
2,693
(821
)
4,816
(2,804
)
(3,572
)
Recognition of cumulative translation
adjustments on dissolution of subsidiaries
817
—
—
—
—
—
—
—
Income tax expense (recovery)
1,691
1,021
761
(1,912
)
605
552
(7,984
)
(633
)
Adjusted EBITDA*
$
22,416
$
15,770
$
7,264
$
(14,958
)
$
4,334
$
(4,397
)
$
(2,894
)
$
(7,094
)
Net earnings (loss) from continuing
operations - GAAP
$
10,906
$
(13,910
)
$
(11,752
)
$
(38,406
)
$
(10,036
)
$
(28,538
)
$
(11,167
)
$
(14,483
)
Stock-based compensation and related
social taxes
3,758
3,281
5,832
1,820
3,807
7,928
6,461
5,085
Phantom RSU expense (recovery)
157
(202
)
393
(69
)
569
206
691
261
Restructuring
3,715
4,004
7,592
369
1,720
2,574
4,800
3,089
COVID-19 government relief
(22
)
(11
)
(5,557
)
(168
)
(1,016
)
(2,049
)
(954
)
(6,298
)
CEO retirement/search
—
—
44
42
400
1,655
—
—
Impairment
—
10,299
741
11,544
—
—
—
—
Gain on sale of Omnilink
(9,179
)
—
—
—
—
—
—
—
Ransomware incident
(1,089
)
(59
)
(959
)
271
1,135
533
—
—
COVID-19 factory constraint incremental
costs
—
1,096
22
1,135
—
—
—
—
Other non-recurring costs
682
99
978
323
593
508
445
439
Acquisition-related amortization
1,558
2,152
2,254
2,776
2,890
3,135
3,306
3,555
Foreign exchange loss (gain), net of
realized gain/loss on hedge contracts
5,317
2,326
1,927
2,693
(821
)
4,816
(2,804
)
(3,572
)
Recognition of cumulative translation
adjustments on dissolution of subsidiaries
817
—
—
—
—
—
—
—
Income tax expense (recovery)
adjustment
126
(500
)
(441
)
(3,008
)
(357
)
(393
)
(7,784
)
200
Adjusted earnings (loss) from
continuing operations*
$
16,746
$
8,575
$
1,074
$
(20,678
)
$
(1,116
)
$
(9,625
)
$
(7,006
)
$
(11,724
)
Weighted average number of shares
outstanding (in thousands)
Basic
38,770
37,974
37,541
37,196
36,992
36,736
36,534
36,417
Diluted
39,079
37,974
37,541
37,196
36,992
36,736
36,534
36,417
Basic and diluted adjusted earnings
(loss) per share from continuing operations (in dollars)*
$
0.43
$
0.23
$
0.03
$
(0.56
)
$
(0.03
)
$
(0.26
)
$
(0.19
)
$
(0.32
)
SIERRA WIRELESS, INC.
SEGMENTED RESULTS
(In thousands of U.S. dollars, except
where otherwise indicated)
2022
2021
Q2
Q1
Total
Q4
Q3
Q2
Q1
IoT Solutions
Revenue
$
139,678
$
133,708
$
323,075
$
104,531
$
53,657
$
90,309
$
74,578
Gross margin
$
42,013
$
40,525
$
83,765
$
26,578
$
10,676
$
24,425
$
22,086
Gross margin %
30.1
%
30.3
%
25.9
%
25.4
%
19.9
%
27.0
%
29.6
%
Enterprise Solutions
Revenue
$
48,273
$
39,249
$
150,134
$
45,381
$
28,793
$
42,476
$
33,484
Gross margin
$
21,169
$
14,538
$
73,034
$
22,114
$
13,473
$
21,806
$
15,641
Gross margin %
43.9
%
37.0
%
48.6
%
48.7
%
46.8
%
51.3
%
46.7
%
Total
Revenue
$
187,951
$
172,957
$
473,209
$
149,912
$
82,450
$
132,785
$
108,062
Gross margin
$
63,182
$
55,063
$
156,799
$
48,692
$
24,149
$
46,231
$
37,727
Gross margin %
33.6
%
31.8
%
33.1
%
32.5
%
29.3
%
34.8
%
34.9
%
Revenue by Type:
Product
$
156,538
$
138,052
$
332,810
$
113,619
$
47,207
$
97,595
$
74,389
Connectivity, software, and services
$
31,413
$
34,905
$
140,399
$
36,293
$
35,243
$
35,190
$
33,673
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220809006123/en/
Media Contact: Louise Matich pr@sierrawireless.com
Investor Contact: Sean Fallis
investor@sierrawireless.com
Sierra Wireless (TSX:SW)
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