UTStarcom reported Q1 net sales of $901.8 million, an increase of 44.9% over net sales of $622.3 million reported in Q1 of 2004.
The UTStarcom Personal Communications Division, formerly Audiovox Communications, which was acquired in November 2004, contributed $315.6 million of sales in the quarter and the Company recorded $268.6 million of sales related to contracts with Japan Telecom, which were awarded last summer.
First quarter gross profit margin was 26.4% of sales as compared to gross profit margin of 28.3 percent of sales in the first quarter of 2004. Gross profit margin for the Company excluding the Personal Communications Division was 38.3% of sales. Gross profit margin for the Personal Communications Division business was 4.3% of sales.
GAAP net income for the first quarter of 2005 was $38.0 million, or $0.29 diluted earnings per share.
The company said nearly 75% percent of total revenue in Q1 came from outside of China, compared to approximately 9% at the same time last year. UTStarcom also warned that this year’s decline in its PAS business in China will be more significant than it had initially expected due to the maturation of the market and uncertainty around timing of 3G license awards. The company now expects the decline to be in the range of 40 to 50% from 2004 revenue levels of approximately U.S. $2.0 billion, rather than its originally anticipated decrease of 30%. http://www.utstarcom.com
