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To: akmike who wrote (797)4/18/2001 10:10:29 AM
From: akmike
   of 6936
 
IMO the timing of this financing announcement signals the likelihood of no negative surprises from the upcoming earnings and cc. For one, I will not consider it negative for R & D to have been ramped considerably, whereas it would be negative for revenues to slide.

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To: akmike who wrote (798)4/19/2001 8:03:29 AM
From: Roy F
   of 6936
 
KVH Reports 43 Percent First Quarter Revenue Growth

Company Reiterates Expected Strong 2001 Revenue Growth

MIDDLETOWN, R.I.--(BUSINESS WIRE)--April 19, 2001--KVH Industries, Inc. (Nasdaq: KVHI - news), a leading provider of innovative high-bandwidth communications products, today reported that revenue for the first quarter ended March 31, 2001, grew 43 percent to $8.1 million from $5.7 million in the first quarter of 2000. In addition, KVH reported a net loss per share for the first quarter of $.18 versus $.12 in the prior year. The net loss reflects an expansion of research investments in photonic fiber and mobile broadband technologies, and changes in the company's tax rate. The operating loss for the period was $1.5 million compared to a loss of $1.1 million in 2000, while the net loss for the first quarter 2001 was $1.5 million compared to $0.9 million in 2000. The company's net loss for the first quarter of 2000 was positively impacted by the use of $0.5 million in income tax benefits.

``Our three-fold increase in fiber optic sales and a four-fold increase in tactical navigation sales resulted in an extremely strong start to our year,'' said Martin Kits van Heyningen, president and CEO. ``The 43 percent increase in first quarter revenues demonstrates that our business fundamentals are continuing to improve. We also raised a total of $15 million through private equity placements since December 2000. Our board has also authorized the sale of up to $5 million of additional shares and the company is continuing discussions with institutional investors. With our financing efforts essentially completed, we are able to accelerate our photonic fiber and mobile broadband research initiatives. Both projects are on schedule, and we are pleased with our progress to date. The progress we've made with our photonic fiber modulator development was recently acknowledged at the Optical Fiber Conference in Anaheim, California where Light Reading magazine named our technology one of its ''10 Hot Products`` out of thousands of products presented by 975 exhibitors attending the conference.''

Richard Forsyth, chief financial officer, commented, ``The margin improvements we experienced during 2000 in our core business have continued in 2001. Our success in sustaining manufacturing efficiencies while driving down product costs resulted in gross margin improvement of 500 basis points from last year's first quarter. Our net loss for the quarter increased by $0.6 million or $.07 per share as a result of fully reserving our quarterly income tax benefit. Last year's first quarter tax benefit reduced our loss by $0.5 million or approximately $.07 per share.''

Mr. Kits van Heyningen concluded, ``Looking ahead, we are facing a changing economic environment, and we expect our satellite communications sales to continue to grow, though perhaps at a slower pace than in prior years. Nevertheless, we remain optimistic about our markets and reaffirm the guidance we provided in February that we believe this year's revenue growth will be in the 30% to 35% range. Our goal is to set KVH on a long-term course of significant growth and our photonic fiber and mobile broadband initiatives are the vehicles to achieve this objective.''

First-quarter Highlights:

On April 18, 2001 KVH Industries announced the completion of a private placement of 1,538,461 common shares priced at $6.50, bringing our total funds raised since December to $15 million. In addition, our board has authorized the sale of up to $5 million of additional shares, and the company is continuing discussions with institutional investors.
On March 19, 2001, KVH Industries unveiled its new ActiveFiber technology, with which the company is creating next-generation optical networking components directly within individual strands of optical fiber. KVH Industries also introduced its E-Core® polarization-maintaining fiber. E-Core fiber offers numerous advantages, including high polarization-maintaining ability (greater than 40 dB-m) and low sensitivity to stress and temperature. In addition, the company revealed the preliminary specifications for its new 40-gigabit-per-second photonic fiber optical modulator.
On March 6, 2001, KVH Industries announced that a contract manufacturer had placed a $1.75 million order for C80 compass sensors, to be integrated into the ProLink System, a golf cart-mounted, Global Positioning System (GPS)-based navigational and tracking system being assembled on behalf of ProLink.
On January 8, 2001, KVH Industries announced that it received a $3.2 million contract to supply KVH's TACNAV(TM) tactical navigation system to General Motors (GM) Defense for use aboard the Australian Army's Light Armored Vehicle (ASLAV) fleet. TACNAV will be incorporated as a retrofit into the existing fleet of Australian ASLAVs, as well as be integrated into new production vehicles.
On January 2, 2001, KVH Industries announced the completion of a private placement of 800,000 common shares priced at $6.25 per share. The State of Wisconsin Investment Board, a current KVH shareholder, purchased the entire placement. The proceeds from this placement will be used to fund the current Photonic Fiber and Mobile Broadband R&D projects.
KVH is webcasting its first quarter 2001 conference call live at 11:30 a.m. Eastern Time today through the company's web site at kvh.com. The audio also will be archived at the company's web site within three hours after the call's completion.

KVH Industries, Inc. is a leading provider of innovative high-bandwidth communications products. Using proprietary fiber-optic and satellite antenna technology, the company is developing next-generation systems with greater precision, durability, and versatility for communications, navigation, and industrial applications. An ISO 9001-registered company, KVH has headquarters in Middletown, Rhode Island, with a fiber optic manufacturing facility in Illinois, and a European sales, marketing and support office in Hoersholm, Denmark.


KVH INDUSTRIES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS


March 31, December 31,
2001 2000
(Unaudited) (Audited)
Assets:
Current assets:
Cash and cash equivalents $ 5,982,024 5,411,460
Accounts receivable, net 4,751,712 6,553,976
Costs and estimated earnings
In excess of billings on
uncompleted contracts 318,685 419,145
Inventories 4,091,628 3,600,660
Prepaid expenses and other
deposits 544,626 346,518
Deferred income taxes 637,799 637,799

Total current assets 16,326,474 16,969,558

Property and equipment, net 6,682,950 6,580,375
Other assets, less accumulated
amortization 673,317 706,473
Deferred income taxes 2,238,430 2,238,430

Total assets $25,921,171 26,494,836

Liabilities and stockholders' equity:
Current liabilities:
Bank line of credit $ -- 598,865
Current portion long term debt 81,111 81,111
Accounts payable 2,456,844 1,478,198
Accrued expenses 1,792,371 1,164,790
Customer deposits 1,187,379 1,195,091

Total current liabilities 5,517,705 4,518,055

Long term debt 2,766,384 2,784,121

Total liabilities 8,284,089 7,302,176

Stockholders' equity:
Common stock 86,442 86,191
Additional paid-in capital 21,167,996 21,186,459
Accumulated deficit (3,617,355 (2,079,990

Total stockholders' equity 17,637,083 19,192,660

Total liabilities and
stockholders' equity $25,921,171 26,494,836




KVH INDUSTRIES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

Three months ended
March 31,
2001 2000

Net sales $ 8,132,671 5,696,515
Cost of sales 5,009,173 3,818,276
Gross profit 3,123,498 1,878,239

Operating expenses:
Research and development 1,744,205 1,074,442
Sales and marketing 2,248,332 1,418,388
General and administrative 638,252 527,734

Loss from operations (1,507,291) (1,142,325)

Other expense (income):
Other expense 22,335 127,787
Interest expense, net 7,741 2,763
Foreign currency loss -- 76,991
Loss before income tax benefit (1,537,365) (1,349,866)

Income tax benefit -- 483,619
Net loss (1,537,365) (866,247)

Per share information:

Loss per share:
Basic $ (0.18) (0.12)
Diluted $ (0.18) (0.12)

Number of shares used in
per-share calculation:
Basic 8,626,470 7,435,915
Diluted 8,626,470 7,435,915


This press release may contain certain forward-looking statements that involve risks and uncertainties. The actual results realized by the Company could differ materially from the statements made herein. Factors that might cause such differences include, but are not limited to: failure to develop and market fiber optic products; lack of reliable vendors, service providers and outside products; continued poor military sales cycles; unforeseen changes in competing technologies and products; worldwide economic variances; and poor or delayed research and development results. Additional factors are discussed in the company's Annual Report on Form 10K filed with the Securities and Exchange Commission on February 8, 2001. Copies are available through the company's Investor Relations Department or web site.


--------------------------------------------------------------------------------
Contact:
KVH Industries Contact:
Richard Forsyth, Chief Financial Officer
401-847-3327
or
Investor Relations Contact:
Morgen-Walke Associates
Kristian Svindland or Jolinda Taylor
617-747-3600
or
Financial Media Contact:
Morgen-Walke Associates
Ron Heckmann
415-296-7383

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To: david james who started this subject4/19/2001 2:51:29 PM
From: Roy F
   of 6936
 
8-K on financing:
<snip>
On April 2, 2001 and April 17, 2001, we issued and sold an aggregate of 1,230,770 shares of our common stock at a purchase price of $6.50 per share to Special Situations Fund III, L.P., Special Situations Cayman Fund, L.P., Special Situations Private Equity Fund, L.P. and Special Situations Technology Fund, L.P. pursuant to a Common Stock Purchase Agreement dated March 30, 2001. A copy of the Common Stock Purchase Agreement is attached as Exhibit 10.40 to this Current Report on Form 8-K.

On April 17, 2001, we issued and sold an aggregate of 307,692 shares of our Common Stock at a purchase price of $6.50 per share to the State of Wisconsin Investment Board pursuant to a Common Stock Purchase Agreement dated April 16, 2001. The Common Stock Purchase Agreement is attached as Exhibit 10.41 to this Current Report on Form 8-K.

The Common Stock Purchase Agreements described above provide, among other matters, that, in the event we sell additional shares of common stock at a price that is less than $6.50 per share (subject to certain exceptions) within ninety (90) days after the sale of the shares of common stock described above, the purchasers will be entitled to receive from us an amount in cash equal to the number of shares of common stock purchased by each purchaser multiplied by the difference between $6.50 and the sale price of the additional shares.




ragingbull.lycos.com

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To: Roy F who wrote (800)4/19/2001 8:49:48 PM
From: robert b furman
   of 6936
 
Hi Roy,

Just wanted to say thank you for your guidance last week.

It was your (as usual) clear logic that prompted me to snag another 5,000 shares at 6.40.It was something like " this gives us an opportunity to buy KVHI at below mutual fund pricings " that really made a lot of sense.

Just like when Wisc. bot in before - They were soon above water.


This stock is really going to be exciting to hold over the next 12-18 months at least.ggggg


Thanks again


Bob

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To: robert b furman who wrote (801)4/20/2001 7:27:02 AM
From: Roy F
   of 6936
 
Hey Bob,

Kudos and congrats on your additional shares. I expect we'll be seeing a SEC 13 filing from you in the not too distant future. >G<

I assume you listened to the CC. Any thoughts you'd care to share?

Regards,

Roy

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To: Roy F who wrote (802)4/20/2001 8:27:57 AM
From: robert b furman
   of 6936
 
Hi Roy,

Just returned from being on the road "buying cars".Must listen to the call and will get back to you.

Thanks

Bob

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To: robert b furman who wrote (803)4/21/2001 12:55:52 PM
From: Sector Investor
   of 6936
 
From Yahoo! A KEY part of the Q&A is highlighted. Good job!

messages.yahoo.com

AND I added a comment also

post.messages.yahoo.com

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To: Sector Investor who wrote (804)4/23/2001 4:32:45 AM
From: Pink Minion
   of 6936
 
Anybody hear when they think they might be profitable?

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To: Pink Minion who wrote (805)4/23/2001 9:26:53 AM
From: Sector Investor
   of 6936
 
<<Anybody hear when they think they might be profitable? >>

The rapid rise in R&D is temporary, as they have elected to use consultants. Martin said the bulk of that will be in the first half of 2001, after which they concentrate on getting ready for production of the new products..

Martin reaffirmed at least $39 million in revenue in 2001. They did $8 million in Q1, leaving $31 million. Since Q2 and Q4 are the strongest quarters, this will probably breakdown as something like $10+M, $9M, $11+M, the rest of this year. The problem is a quick calculation shows that during this temporary high R&D and S&M period they need about $12 million to break even, whereas they were profitable in Q4 2000 at $8+ million.

That higher breakeven number should drop back next year, and revenue should rise significantly next year, as Martin said that the new modulator, the new ultra low profile antenna, and the current sensor ALL will be in production for revenue in January 2002.

So, probably two-three more quarters of small losses. They will have entered two MULTI-BILLION DOLLAR markets, using only a total of $15 million funding, and not all of that is likely to be spent. Some people might be thinking of waiting to buy here, but I don't think the price will be this low later in the year.

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To: Sector Investor who wrote (804)4/24/2001 7:29:53 PM
From: hamsandwich
   of 6936
 
Hey Sector (or thread),

Thanks, as usual, for the links.

I have a question re: reliability of the polymers used by KVH. A fairly insightful poster on another thread suggested cause for concern as far as the long term reliability of electro-optic polymers, specifically as reliability is necessary to meet the needs of the telcos. I have been meaning to do some research myself but the job has kept me from doing much digging (I really have to ditch my day job!).

Do you have a link/site/other suggestion as to a resource I might look at regarding reliability of polymers?

Thanks in advance.

ham

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