Andrew Reports a Loss on Tax Costs

Andrew Corp. has reported record total sales of US$599 million for its fourth quarter ended September 30, 2006, an increase of 16% compared to US$518 million in the prior year quarter. In the fourth quarter 2006, wireless infrastructure sales increased 16% versus the prior year quarter due mainly to growth for products supporting global wireless network upgrades and expansion and the inclusion of $23.7 million of sales from the acquisition of Precision Antennas in April 2006. Satellite Communications sales increased 2% versus the prior year quarter.

In the fourth quarter the company recorded a net loss of $59.7 million compared to net income of $7.5 million in the year ago quarter. The company recorded a non-cash charge in the fourth quarter to provide a full valuation allowance of $83.4 million on its US deferred tax assets.

"We believe our industry-leading product portfolio and globally diversified customer base provides the company with a strategic ability to benefit from network upgrades and expansions that are occurring in each major region around the globe, as demonstrated by record sales for the company during the fourth quarter," said Ralph Faison, president and chief executive officer, Andrew Corporation.

"Our fourth quarter financial results reflect strong execution and positive operational improvement despite the uncertainty surrounding the ADC merger agreement and its termination. We are seeing benefits from our aggressive actions, including the surcharges and/or price increases on cable products that have been implemented in all geographic regions to recover higher commodity costs."

The top 25 customers represented 68% of sales in the fourth quarter, compared to 71% in the prior quarter and 67% in the year ago quarter. Major original equipment manufacturers (OEMs) accounted for 41% of sales in the fourth quarter, compared to 38% in the prior quarter and 37% in the year ago quarter. Ericsson, Lucent Technologies, Siemens, Cingular Wireless and Nokia each represented 5% or more of total sales for the fourth quarter."

Posted to the site on 27th October 2006