CATZ Computer Access Technology (MM)

Computer Access Technology Reports Earnings Per Share of $0.02 On Revenue of $4.6 Million for Q1 2004 SANTA CLARA, Calif., April 22 /PRNewswire-FirstCall/ -- Computer Access Technology Corporation (CATC) , a communication protocols expert company, today reported financial results for the first quarter ended March 31, 2004. Revenue for the first quarter of 2004 was $4.6 million, compared to $3.3 million for the first quarter of 2003 and $4.1 million for the fourth quarter of 2003. The Company reported an operating profit of $203,000 for the first quarter of 2004 compared with an operating loss of $624,000 in the first quarter of 2003. Combined with net other income of $158,000, the resulting net profit for the first quarter of 2004 was $361,000, or $0.02 basic and diluted per share, compared to a net loss of $463,000, or $(0.02) basic and diluted per share in the first quarter of 2003. The Company's net profit includes the amortization of stock based compensation and the amortization of purchased intangibles. The Company generated $958,000 in cash flow from operations during the first quarter of 2004. For the first quarter of 2004, the Company's gross profit margin was 82.2%, compared to 79.4% in the first quarter of 2003. The Company's operating expenses totaled $3.6 million. Dan Wilnai, Chairman of the Board and Chief Executive Officer, said: "Our continuing commitment to enhance and expand our expert analysis product portfolio, along with the strong efforts of our employees to quickly, efficiently and cost-effectively develop and sell these products, converged nicely to produce a successful first quarter. We are determined to maintain this positive momentum and to continue to deliver sophisticated products that address our customers' needs for multi-protocol analysis systems that can be used throughout the lifecycle of their products, from development to production to installation and maintenance. During the quarter and in recent weeks CATC made the following corporate announcements: -- CATC filed a registration statement with the Securities and Exchange Commission for the sale of common stock owned by certain existing shareholders in a secondary offering underwritten by B. Riley & Co. CATC furthermore announced that it was not participating in, nor would it receive any proceeds from, the secondary offering. On March 17, 2004, CATC announced that 4.25 million shares of common stock were sold in connection with the secondary offering. On April 15, 2004, B. Riley & Co. exercised an over-allotment option granted by the selling shareholders to purchase an additional 637,500 shares for a total of 4,887,500 shares of common stock sold pursuant to the secondary offering. The shares sold in the secondary offering were priced at $4.60 per share. -- CATC formed an alliance with dashcourses, Inc. to offer integrated training solutions to engineers and developers including demonstrations and hands-on lab exercises featuring CATC's expert protocol analyzer and exerciser products. Together, the companies will initially deliver open enrollment training for InfiniBand(R), iSCSI, PCI Express(TM), SAS, SATA, SCSI, and USB at CATC's headquarters in Santa Clara. During the quarter CATC made the following product related announcements: -- Availability of device emulation capabilities for its USBTracer/Trainer expert analysis system, allowing users to generate USB device traffic and enabling testing of a USB hosts and device drivers' ability to handle error conditions and exceptions. USB device emulation complements the existing capabilities of CATC's USBTrainer exerciser module, creating a comprehensive system design and debug environment. -- Release of its SASTrainer -- a 3 Gbps traffic generator and bus exerciser option for its SAS and SATA expert analysis system. The SASTracer/Trainer v1.1 protocol analyzer/exerciser system is designed to address both SAS and pure Serial ATA development environments making it a flexible and cost-effective solution for end-to-end SAS and SATA test and analysis. -- Selection by Mellanox(R) Technologies Ltd., of the CATC PETracer ML, PCI Express(TM) protocol analyzer for use in the design and debug of its third generation InfiniBand Host Channel Adapters (HCA), the InfiniHost III Ex. -- Release of version 1.1 of its SASTracer expert analysis software allowing comprehensive Serial ATA recording and analysis for up to four 1.5 or 3 Gbps SATA links, the addition of full SATA and STP capabilities, and other improvements. With the release of the version 1.1 software, the SASTracer is well suited for 4-wide SAS or 4 port SATA verification tasks and for testing SAS, SATA and mixed SAS/SATA single and multi-link environments. Conference Call, Webcast CATC has scheduled a conference call for analysts and investors to discuss our quarterly results at 8:00 a.m. PDT on Thursday, April 22, 2004. Open to the public, a live Webcast of the conference call will be accessible from the "Investor Relations" section of CATC's website ( http://www.catc.com/investor/ ). Following the live Webcast, an archived version of the Webcast will be available on the CATC website through May 31, 2004. About CATC CATC, a communication protocol expert company, provides advanced verification systems and connectivity products for existing and emerging digital communications standards such as Bluetooth, Ethernet, Fibre Channel, IEEE 1394, InfiniBand, PCI Express, SCSI, Serial ATA, Serial Attached SCSI (SAS) and USB. CATC products are used by semiconductor, device, system and software companies at each phase of their products' lifecycles from development through production and market deployment. CATC's expert protocol analysis systems allow customers to monitor communications traffic, diagnose design and operational problems and confirm interoperability and standards compliance. Technicians also use CATC's test and analysis products on production lines and for maintenance of deployed systems and networks. CATC was founded in 1992 and is headquartered in Santa Clara, California. For more information regarding CATC and its products, please visit http://www.catc.com/ . Regarding Forward-Looking Statements This press release may contain forward-looking statements based on CATC's current expectations, such as availability of product, market acceptance and competition, management capability and experience, levels of growth, profitability and shareholder value. These forward-looking statements involve risks and uncertainties. A number of important factors could cause actual results to differ materially from those in the forward-looking statements, such as CATC's production of new products, market acceptance of its products, competitive pressures, management performance, success of growth, profitability and increased shareholder value. These factors, as well as other factors that could cause actual results to differ materially, are discussed in more detail in CATC's Annual Report on Form 10-K, filed February 20, 2004, as amended by its Form 10-K/A filed on March 3, 2004, and subsequent filings CATC may make with the SEC, as amended, which can be viewed at the Securities and Exchange Commission's website at http://www.sec.gov/ . NOTE: CATC, Computer Access Technology Corporation, PETracer ML, SASTracer, SASTracer/Trainer, SASTrainer, USB Tracer/Trainer, and USBTrainer are proprietary marks of Computer Access Technology Corporation. All other company names and marks may be trademarks of the respective companies with which they are associated. COMPUTER ACCESS TECHNOLOGY CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited, in thousands) March 31, December 31, 2004 2003 ASSETS Current assets: Cash and cash equivalents $23,161 $34,116 Short-term investments 630 1,055 Trade accounts receivable, net 2,884 3,180 Inventories 1,059 907 Other current assets 582 675 Total current assets 28,316 39,933 Long-term investments 21,760 9,367 Property and equipment, net 793 768 Purchased intangibles 133 167 Other assets 128 114 $51,130 $50,349 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $326 $393 Accrued expenses 2,969 2,919 Accrued restructuring 23 29 Deferred revenue 607 535 Total current liabilities 3,925 3,876 Deferred rent 8 2 Total liabilities 3,933 3,878 Stockholders' equity: Common stock 20 19 Additional paid-in capital 52,901 52,595 Deferred stock-based compensation -- (32) Unrealized gain on investments 26 -- Accumulated deficit (5,750) (6,111) Total stockholders' equity 47,197 46,471 $51,130 $50,349 COMPUTER ACCESS TECHNOLOGY CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited, in thousands, except per share amounts) Three Month Periods Ended March 31, 2004 2003 Revenue $4,645 $3,262 Cost of revenue 816 664 Amortization of acquired developed technology 8 9 Gross profit 3,821 2,589 Operating expenses: Research and development 1,603 1,308 Sales and marketing 1,281 1,144 General and administrative 682 676 Amortization of purchased intangibles 26 26 Amortization of deferred stock-based compensation 26 59 Total operating expenses 3,618 3,213 Income (loss) from operations 203 (624) Other income, net 158 161 Income (loss) before provision for (benefit from) income taxes 361 (463) Provision for (benefit from) income taxes -- -- Net income (loss) $361 $(463) Net income (loss) per share: Basic and diluted $0.02 $(0.02) Weighted average shares outstanding: Basic 19,479 19,443 Diluted 20,643 19,443 DATASOURCE: Computer Access Technology Corporation CONTACT: Computer Access Technology Corporation, +1-408-486-7786, or Web site: http://www.catc.com/

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