NASDAQ: SWIR

VANCOUVER, April 30 /CNW/ - Sierra Wireless, Inc. (NASDAQ: SWIR, TSX: SW) is reporting first quarter 2009 results.

Our results are reported in U.S. dollars and are prepared in accordance with United States generally accepted accounting principles.

"In the first quarter of 2009, we posted better than expected financial results, introduced and launched several market leading products and completed our acquisition of Wavecom," said Jason Cohenour, President and Chief Executive Officer. "Our first quarter revenue, non-GAAP earnings and cash flow from operations were all better than expected. We launched the world's first HSPA+ products with Telstra in Australia and CSL in Hong Kong, while also introducing new embedded module solutions and launching important high volume successor products with key customers.

While executing on our business, we were also able to complete our acquisition of Wavecom and acquire the voting rights required to implement the squeeze out of the remaining shareholders. We built strong momentum with our integration activities and demonstrated the power of our combination at the CTIA conference in April and with key customers. We firmly believe that this combination will establish Sierra Wireless as a uniquely positioned global leader in wireless for mobile computing and M2M.

As we look forward, we are focused on continued strong business execution in a challenging environment and a successful integration with Wavecom. We remain confident that when the business cycle strengthens, we will be well positioned with a broad and diversified product line, a long list of blue chip customers and partners, a strong global presence and an excellent team."

Q1 2009 Financial Results - GAAP

Our revenue for the first quarter of 2009 amounted to $111.4 million, gross margin was $30.7 million, or 27.6% of revenue, operating expenses were $41.0 million, loss from operations was $10.3 million and our net loss was $23.7 million, or loss per share of $0.76.

Q1 2009 Financial Results - Non-GAAP

Our non-GAAP results exclude the results of Wavecom from the date of acquisition until March 31, 2009, transaction costs related to Wavecom, restructuring costs, integration costs, stock based compensation expense, acquisition related amortization, and foreign exchange gains and losses and interest expense related to the Wavecom acquisition. Adjusting for these amounts, our non-GAAP results for Q1 2009 are as follows:

(in millions of U.S. dollars) Q1 09 Q1 08

----- -----

Revenue - GAAP...................................... $ 111.4 $ 141.9

Wavecom revenue from March 1, 2009 to

March 31, 2009................................... (11.0) -

--------- ---------

Revenue - Non-GAAP.................................. $ 100.4 $ 141.9

--------- ---------

Gross margin - GAAP $ 30.7 $ 39.3

Wavecom gross margin from March 1, 2009 to

March 31, 2009................................... (3.5) -

Stock-based compensation.......................... 0.1 0.1

--------- ---------

Gross margin - Non-GAAP............................. $ 27.3 $ 39.4

--------- ---------

Earnings (loss) from operations - GAAP.............. $ (10.3) $ 11.4

Wavecom loss from operations from March 1, 2009 to

March 31, 2009................................... 3.0 -

Transaction costs................................. 6.5 -

Restructuring costs............................... 1.1 -

Integration costs................................. 0.3 -

Stock-based compensation.......................... 2.0 1.6

Acquisition related amortization.................. 2.2 1.0

--------- ---------

Earnings from operations - Non-GAAP................. $ 4.8 $ 14.0

--------- ---------

Net earnings (loss) - GAAP.......................... $ (23.7) $ 9.7

Wavecom net loss from March 1, 2009 to

March 31, 2009................................... 3.0 -

Transaction, restructuring, integration, stock-based

compensation and acquisition amortization costs, net

of tax........................................... 11.9 1.8

Unrealized foreign exchange loss.................. 9.1 -

Interest expense.................................. 4.3 -

Non-controlling interest.......................... (0.3) -

--------- ---------

Net earnings - Non-GAAP............................. $ 4.3 $ 11.5

--------- ---------

Diluted earnings (loss) per share - GAAP............ $ (0.76) $ 0.31

Diluted earnings per share - Non-GAAP............... 0.14 0.37

On a non-GAAP basis, results for the first quarter of 2009, relative to guidance provided on February 10, 2009 are as follows:

First quarter revenue for 2009 of $100.4 million was better than our

guidance of $93.0 million. Our earnings from operations were

$4.8 million, better than our guidance of a loss from operations of

$0.5 million. Our net earnings of $4.3 million, or diluted earnings per

share of $0.14, were better than our guidance of net earnings and diluted

earnings per share of nil.

On a non-GAAP basis, results for the first quarter of 2009, compared to the first quarter of 2008 are as follows:

First quarter revenue decreased by 29% to $100.4 million in 2009,

compared to $141.9 million for the same period in 2008. Gross margin for

the first quarter of 2009 was 27.2% of revenue, compared to 27.8% for the

same period in 2008. Operating expenses were $22.4 million and earnings

from operations were $4.8 million in the first quarter of 2009, compared

to $25.5 million and $14.0 million, respectively, in the same period of

2008. Net earnings for the first quarter of 2009 were $4.3 million, or

diluted earnings per share of $0.14, compared to net earnings of

$11.5 million, or diluted earnings per share of $0.37, in the same period

of 2008. Our weighted average shares outstanding used in calculating

earnings per share decreased to 31.0 million in the first quarter of 2009

from 31.4 million in the prior year because our options outstanding did

not have any dilutive impact and we had repurchased shares under our

normal course issuer bid.

On a non-GAAP basis, results for the first quarter of 2009, compared to the fourth quarter of 2008 are as follows:

Revenue for the first quarter of 2009 decreased by 24% to $100.4 million,

compared to $132.9 million in the fourth quarter of 2008. Gross margin

was 27.2% of revenue in the first quarter of 2009, compared to 27.5% in

the fourth quarter of 2008. Operating expenses were $22.4 million and

earnings from operations were $4.8 million in the first quarter of 2009,

compared to $25.5 million and $11.1 million, respectively, in the fourth

quarter of 2008. Net earnings for the first quarter of 2009 were

$4.3 million, or diluted earnings per share of $0.14, compared to net

earnings of $11.2 million, or diluted earnings per share of $0.36, in the

fourth quarter of 2008.

Our balance sheet remains strong, with $145.1 million of cash, cash equivalents and short-term investments at March 31, 2009. Of the $145.1 million, $29.5 million is restricted cash that provides security for the letter of credit issued in connection with the acquisition of Wavecom. In the first quarter of 2009, we generated $10.5 million of cash from operations on a GAAP basis. On a non- GAAP basis, we generated approximately $4.5 million of cash from operations.

First Quarter and Recent Highlights Included:

- We launched our USB 598 modem for EV-DO Rev A networks with Sprint for

use on the Sprint Mobile Broadband Network.

- We announced that our USB 598 is available for use on the Verizon

Wireless network, following successful completion of testing under the

operator's Open Development Initiative.

- We introduced our USB 306 and USB 307, the world's first mobile

broadband USB modems for HSPA+ networks. The new modems nearly triple

the speed of other mobile broadband devices, with peak download speeds

of 21 megabits per second (Mbps), making them the fastest mobile

broadband devices available.

- Our new USB modem for HSPA+ networks became commercially available in

Telstra's retail stores. The Next G Turbo 21 modem, also known as the

Sierra Wireless USB 306, is the world's first commercially available

HSPA+ mobile broadband modem.

- CSL Limited, a mobile network operator in Hong Kong, selected two

Sierra Wireless USB modems to provide high-speed wireless connectivity

for notebook computer users on the CSL network. The 1010 Next G

Express 7, an HSPA USB modem also known as the Compass 889, is

currently available and the 1010 Next G Express 21, an HSPA+ USB modem

also known as the USB 306, is expected to be available in April

through CSL's retail brands and enterprise channels.

- In February, we collaborated with Telefnica to demonstrate HSPA+

mobile broadband technology at Mobile World Congress in Barcelona,

using the new Sierra Wireless USB 306.

- We introduced our AirCard 402 for EV-DO Rev A networks, a 2- in-1

mobile broadband card designed to fit both PC card and ExpressCard

slots, ensuring compatibility for future notebook upgrades. Our

AirCard 402 commenced commercial shipments in Q1 and was launched by

Sprint early in Q2.

- We introduced our new embedded module for HSPA+ networks, the MC8700,

that allows OEMs to take advantage of the fastest mobile broadband

speed available worldwide. Our MC8700 offers downlink speeds of up to

21 Mbps and uplink speeds of up to 5.76 Mbps.

- Magneti Marelli, a broad range automotive supplier, selected our

mobile broadband embedded modules with EMConnect(TM) firmware features

for integration into its telematics products for safety, entertainment

and satellite navigation applications.

- We introduced our new AirLink Helix line of integrated 3G wireless

routers that provide critical business continuity and remote site

connectivity with onboard intelligence, extensive routing features and

comprehensive remote management capabilities.

- We announced that our AirLink line of intelligent Mobile and M2M

(machine-to-machine) gateways, initially the PinPoint X and the Raven

X, are expected to be available in Australia in the second quarter of

2009.