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Motorola Reports First-Quarter 2004 Financial Results
- First-quarter 2004 sales of $8.6 billion, up 42 percent versus first-quarter 2003 sales of $6.0 billion.
- First-quarter 2004 GAAP earnings of $609 million, or $.25 per share, versus first-quarter 2003 GAAP earnings of $169 million, or $.07 per share, an increase of 257 percent in earnings per share.
- First-quarter 2004 sales and GAAP earnings also increased sequentially versus fourth-quarter 2003.
- First-quarter 2004 GAAP earnings include: (1) income of $171 million pre-tax, or $.04 per share after-tax, relating to gains on the sales of investments, (2) income of $52 million pre-tax, or $.02 per share after-tax, for the reversal of reserves for previously received incentives, and (3) income of $15 million pre-tax, or one-half of one cent per share after-tax, relating to the reversal of reorganization of business accruals no longer needed. As previously reported in Motorola's 2003 first-quarter earnings release, first-quarter 2003 GAAP earnings included special-item income of $225 million pre-tax, or $.06 per share after-tax, as detailed in that earnings release.
- First-quarter 2004 positive operating cash flow of $858 million, combined with cash proceeds on the sales of investments, enabled the company to complete the quarter with net cash of $902 million, compared with net debt of $41 million at the end of 2003.
SCHAUMBURG, Ill. - 20 April 2004 -- Motorola, Inc. (NYSE: MOT) today reported sales of $8.6 billion in first-quarter 2004. This represents a 42 percent increase from sales of $6.0 billion in first-quarter 2003.
Motorola also reported net earnings of $609 million, or $.25 per share, in first-quarter 2004, presented in accordance with generally accepted accounting principles (GAAP), an increase of 257 percent in earnings per share versus the year-ago quarter.
Motorola Chairman and Chief Executive Officer Ed Zander said, "We are very pleased with the strong financial performance of the first quarter. Sales and earnings exceeded our start-of-the-quarter guidance, the result of strengthening customer demand, improved execution in delivering new products, and growing market share in some areas. We are making steady progress in boosting our financial performance and creating value for our stockholders. I also believe these results reflect increasing momentum for our evolving vision of seamless mobility. Our growing portfolio of products, seamlessly connected, will bring voice, media, and data-rich services to people wherever they are: at home, at work, in the auto or out in the world."
"We also continued to strengthen our balance sheet - a key objective for Motorola for the past several years. We generated positive operating cash flow of $858 million in the first quarter, the thirteenth consecutive quarter of positive cash flow. Combined with cash proceeds from the sale of investments, this enabled Motorola to end the quarter with a net cash position of $902 million. This represents a major milestone for Motorola, as it is the first time in more than 35 years that we have ended a quarter in an overall net cash position. During the quarter, in addition to moving from a net debt position of $41 million to a net cash position of $902 million, we reduced gross debt by $544 million."
Personal Communications Segment sales were $4.1 billion, up 67 percent compared with the year-ago quarter. Operating earnings were $398 million, compared with operating earnings of $114 million in the year-ago quarter. The increases in sales and operating earnings were due to the success of new products introduced in the second half of 2003. During the quarter, the segment shipped 25.3 million handsets, up 51 percent from the year-ago quarter, and improved its market share, particularly in Europe. The segment also announced 25 new handsets, 24 featuring color displays and 16 featuring integrated cameras.
Global Telecom Solutions Segment sales were $1.3 billion, up 38 percent compared with the year-ago quarter. The segment reported operating earnings of $119 million, compared with $29 million in the year-ago quarter.
Commercial, Government and Industrial Solutions Segment sales were $1.0 billion, up 18 percent compared with the year-ago quarter .The segment reported operating earnings of $178 million, compared with operating earnings of $62 million in the year-ago quarter.
Integrated Electronic Systems Segment sales were $654 million, up 26 percent compared with the year-ago quarter, and the segment reported operating earnings of $43 million, compared with $25 million in the year-ago quarter.
Broadband Communications Segment sales were $488 million, up 16 percent compared with the year-ago quarter. Operating earnings increased to $24 million, compared with $13 million in the year-ago quarter.
Guidance for Second-Quarter 2004
The company's guidance for second-quarter 2004 is sales of between $8.2 and $8.6 billion and GAAP earnings per share in the range of $.14 to $.18 .
About Motorola
Motorola, Inc. (NYSE: MOT) is a global leader in wireless, broadband and automotive communications technologies that help make life smarter, safer, simpler, synchronized and fun. Sales in 2003 were $27.1 billion. Motorola creates innovative technological solutions that benefit people at home, at work and on the move. The company also is a progressive corporate citizen dedicated to operating ethically, protecting the environment and supporting the communities in which it does business. For more information:www.motorola.com.
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