Santa Ana-based Powerwave Technologies Inc., which makes gear for wireless phone networks, is facing a riptide.
Last fall, the company warned about slowing third-quarter sales, saying it could miss Wall Street expectations by as much as 20%, coming in at $155 million to $160 million.
When results came out in November, sales actually fell closer to 30% to $145.8 million.
At the time, Powerwave Chief Executive Ronald Buschur blamed problems implementing companywide software and delays in moving manufacturing lines.
“These issues combined resulted in both delayed production and shipments, which significantly reduced our actual revenues for the quarter,” he said.
Earlier in 2006, Powerwave saw slower sales to big customer Cingular Wireless LLC, now AT & T.;
Analysts downgraded the shares on the string of downward revisions. Investors haven’t been happy: Shares have dropped like a bad cell phone signal.
Powerwave’s market value has been cut in half in the past year at about $765 million last week.
Now shareholders are showing their ire, and lawyers are more than happy to oblige.
Several suits have been filed in the past couple of weeks claiming Powerwave “misrepresented and failed to disclose numerous conditions that adversely affected the company.”
No lawsuit yet has been granted class-action status. One firm already is pushing for consolidating the litigation.
As for Powerwave, it’s been quiet lately. Fourth-quarter results are due Feb. 20. It hasn’t offered any updates on what to expect.
Newport’s Debt Deal
Irvine-based Newport Corp., a maker of industrial lasers, placed its $150 million debt offering in one day earlier this month.
With cash in hand, Newport plans to pay off what it owes Thermo Electron Corp., which sold its Spectra-Physics unit to Newport in 2004.
The move is set to save on financing costs.
“We probably wouldn’t have paid it off except for that,” Chief Financial Officer Chuck Cargile said. “We’re paying $48 million today vs. $50 million two years from now.”
The company also plans to buy back about 5% of its 42 million outstanding shares, Cargile said.
The rest of the debt offering proceeds are set to add to Newport’s $85 million in cash and securities as of Dec. 31.
More acquisitions also are possible, though nothing’s imminent, Cargile said.
Game Recap
This could be a big year for video games, as I reported in our Jan. 22 issue. Turns out, business wasn’t so bad last year, either.
Most of Orange County’s stable of game makers are privately held or are subsidiaries. So sales figures aren’t easy to come by. But the release of games was brisk last year.
Newport Beach-based game developer Foundation 9 Entertainment Inc. released 37 games in 2006.
Chief Executive Jon Goldman said the company has 30 projects slated for release later this year and into 2008.
Irvine’s Point of View Inc. released four games in 2006, including its football feature “Blitz: The League,” and plans six releases for 2007. Its first bid in the new year is a game based on the hit cable TV show “The Shield.”
Another developer, inXile Entertainment Inc. in Newport Beach had no releases in 2006 and is pinning its 2007 hopes on a couple of titles with a lot of buzz,the adventure game “Heist” and “Line Rider,” sort of an interactive Etch A Sketch meets roller coaster.
Irvine’s Blizzard Entertainment, part of France’s Vivendi SA, is emboldened by hot sales of the latest version of its “World of Warcraft” game.
Part of what makes the year so exciting for game developers is the plethora of platforms. Nintendo Co. has the Wii console and the handheld DS player. Sony Corp. recently launched PlayStation 3. And Microsoft Corp.’s Xbox 360 still is seeing strong demand.
Kingston Captures Miss America
Fountain Valley-based memory products maker Kingston Technology Co. got to rub elbows with the new Miss America. Well, sort of.
Las Vegas was the scene for the beauty pageant’s annual scholarship competition last month.
(Full disclosure: I’ve also participated in scholarship competitions. They involved writing essays and submitting transcripts, not donning a swimsuit, but I digress.)
With all those batons twirling and gleaming teeth, there’s a lot to capture on camera.
In the digital age, the pageant’s official photographer, Bruce Vartan Boyajian, selected Kingston’s CompactFlash Ultimate cards to capture the crowning moment.
“Covering the Miss America competition is an exhaustive and all-consuming process. There are the expected moments, the candids, and of course that all-important shot nabbing the expression of the new Miss America at the exact time she realizes she’s the winner,” Boyajian said.
Newly crowned Miss America Lauren Nelson, of Lawton, Okla., and her competitors received Kingston products as part of their prize package.
