RAE Systems Reports Preliminary Second Quarter 2008 Results
August 04 2008 - 4:05PM
Marketwired
SAN JOSE, CA , a leader in delivering innovative sensor
solutions to serve industrial, energy, environmental, and
government safety markets worldwide, reported preliminary financial
results and business highlights for the second quarter ended June
30, 2008. As discussed below, the Audit Committee of the Board of
Directors of the Company is conducting an independent investigation
into certain accounting and reporting matters. Although the Company
has not yet determined any changes are required to the results
discussed below, these results should be considered preliminary
until the Company files its Quarterly Report on Form 10-Q.
Second Quarter 2008 Preliminary Financial Results
For the second quarter of 2008, RAE Systems expects to report
revenue of $24.7 million, compared with revenue of $20.1 million
for the same quarter in 2007. For the second quarter of 2008,
Americas contributed 38 percent of total revenue, Asia contributed
45 percent and Europe contributed 17 percent. Gross margin for the
quarter was 54 percent, compared with 50 percent for the second
quarter of 2007. The Company expects to report operating expenses
for the quarter were of $12.9 million as compared to operating
expenses of $12.0 million in the second quarter of 2007. The
increase in operating expenses included approximately $0.7 million
relating to the internal investigation. The Company expects to
report a net loss for the second quarter of 2008 of $0.7 million,
or $0.01 per share, compared with a net loss of $2.5 million, or
$0.04 per share, for the second quarter of 2007.
First Six Months 2008 Preliminary Financial Results
For the first six months of 2008, RAE Systems expects to report
revenue of $42.5 million, compared with revenue of $38.0 million
for the same period in 2007. The Company expects to report a net
loss for the first six months of 2008 of $3.0 million, or $0.05 per
share, compared with a net loss of $4.8 million, or $0.08 per
share, for the first six months of 2007.
Robert I. Chen, president and CEO of RAE Systems, said, "Our
diversified market strategy and continued focus on cost control
delivered improved second quarter 2008 preliminary revenue, gross
margin and bottom line results. Our ongoing research and
development efforts have created strong product differentiation
points, which support our growth in the markets we serve. This
year, we have introduced eight new products including the first
solar powered, multi-sensor, gas monitoring system with Class One,
Division 2 hazardous environment safety certification. These
products -- in combination with our existing technology have won
many new customers worldwide, particularly in the rapidly growing
energy sector. In addition, by introducing our radiation and toxic
gas detection in a new form factor, we secured a key contract for
the Beijing International Airport's new terminal as part of its
preparation for the Olympic Games, which will be completed in the
third quarter. We expect that this key win will help RAE Systems
expand its global awareness."
As business conditions continue to be favorable, management
expects full year 2008 revenue to be in the range of $104 to $109
million, gross margin to be in the mid 50 percent range, and the
Company to be profitable for the full year.
Second Quarter 2008 Business Highlights:
-- Delivered 38 radiation portals and AreaRAE wireless toxic gas monitors
to the Beijing International Airport. Additional orders for gammaRAE II and
doseRAE radiation monitors and AreaRAE toxic gas monitors were received
from six additional China airports.
-- Secured a follow-on order for wireless toxic gas monitors for oil
drilling rigs and pump stations from the Liao He Oil Field.
-- Petro China purchased additional fixed and portable monitoring
systems.
-- Sold the first AreaRAE Solar Units to the Total Petroleum Refinery in
Texas to remotely monitor a Storage Tank Farm.
-- Established key wins in the United Kingdom for Wireless AreaRAE Steel
units for deployment on offshore oil platforms.
-- Secured a large order for gas detection, worker safety and personal
protective equipment from the An Steel Company in China.
-- Sold wireless AreaRAE systems to the State of Hawaii to monitor toxic
gases over a 45 mile radius around the active volcano on the Big Island.
-- Sold ppbRAE units to the Hyundai Motor Group for new car Indoor Air
Quality inspections.
-- Sold AreaRAE Steel Rapid Deployment Kits to the Department of Homeland
Security and the Federal Emergency Management Agency's Urban Search and
Rescue teams.
-- Expanded its relationship with New Zealand Fire services as they
purchased additional wireless MiniRAE 3000 wireless VOC monitors.
Internal Investigation
The Audit Committee of the Board of Directors of the Company is
conducting an independent investigation into certain accounting and
reporting matters that were discovered as a result of the Company's
internal audit processes. Based on the results of the investigation
to date, the Company has not yet determined that any changes are
required to the preliminary financial results disclosed in this
press release or to any financial results for any prior period.
However, depending on the results of the investigation, it is
possible that the Company will determine that changes are required.
Based on the matters under investigation, the results of the
investigation could lead to changes to reported revenues or
expenses or period to period adjustments. However, based upon the
results of the investigation to date, the Company does not have any
reason to believe that any such adjustments would impact the
aggregate net income or loss or cash flow.
About RAE Systems
RAE Systems is a leading global provider of rapidly deployable
sensor networks that enable customers to identify safety and
security threats in real time. Products include multi-sensor
chemical detection networks, wireless gas detection systems and
radiation monitors for energy production and refining, industrial
and environmental safety, and public and government first responder
security. RAE Systems' products are used in over 85 countries by
many of the world's leading corporations and by many U.S.
government agencies. For more information about RAE Systems, please
visit www.raesystems.com.
Safe Harbor Statement
This press release may contain "forward-looking" statements, as
that term is used in Section 21E of the Securities Exchange Act of
1934. Forward-looking statements include, without limitation:
expressions of "belief," "anticipation," or "expectations" of
management; statements as to industry trends or future results of
operations of RAE Systems and its subsidiaries; and other
statements that are not historical fact. These types of statements
address matters that are subject to risks and uncertainties, which
could cause actual results to differ materially. Factors that could
cause or contribute to such differences include, but are not
limited to, the results of the Company's internal investigation,
the general economic and industry factors and receptiveness of the
market to RAE Systems and its products. In addition, our
forward-looking statements should be considered in the context of
other risk factors discussed in our filings with the Securities and
Exchange Commission, including but not limited to our annual report
on Form 10-K and Form 10-Q filings, available online at
http://www.sec.gov. All forward-looking statements are based on
information available to the company on the date hereof, and the
company assumes no obligation to update such statements.
Add to Digg Bookmark with del.icio.us Add to Newsvine
Company Contact: Investor Relations RAE Systems 408-952-8449
investorrelations@raesystems.com IR Agency Contact:
Lippert/Heilshorn & Associates, Inc. Kirsten Chapman
415-433-3777 kchapman@lhai.com
Rae (AMEX:RAE)
Historical Stock Chart
From Sep 2024 to Oct 2024
Rae (AMEX:RAE)
Historical Stock Chart
From Oct 2023 to Oct 2024