News Release Details

WI-LAN ANNOUNCES THIRD QUARTER UNAUDITED REVENUE Wi-LAN to release third-quarter results on Sept. 18

08/08/2002



CALGARY, Canada - August 8, 2002 - Wi-LAN Inc. (TSE:WIN), Wi-LAN has provided its unaudited revenue for the three months ended July 31, 2002, and modified its revenue guidance for the 2002 financial year. All financial amounts are expressed in Canadian dollars unless otherwise noted.

Financial highlights

  • Revenue for the three months ended July 31, 2002, was $5.8-million, which is $400,000 less than the $6.2-million for the prior three months ended April 30, 2002, and $1.8-million less than the $7.6-million for the same period in 2001. Year-to-date revenue is $16.8-million.
  • While Wi-LAN continues to expect to exceed its fiscal 2001 revenues of $24.8-million in the 12 months ended Oct. 31, 2002, the company is now guiding annual revenue in the range of $23.1-million to $25-million because uncertainty regarding the timing of certain external events that are beyond the company's control, such as the award of additional 3.5-gigahertz licensed spectrum in China, has introduced additional uncertainty into the timing of Wi-LAN's sales.
  • The cash balance is expected to be adequate to sustain the company's current operations until cash-flow-positive operations are achieved.


  • Wi-LAN has maintained a strong sales force that, with the added presence of growing distribution channels and original equipment manufacturer (OEM) agreements, is continuing to drive forward in the broadband wireless access market. Wi-LAN's broadband wireless access systems (BWS) products, based on Wi-LAN's patented wide-band orthogonal frequency division multiplexing (W-OFDM) technology, are now shipping to several countries including China, and sales of advanced wireless Ethernet bridge (AWE) products, VINE (versatile intelligent network environment) Internet protocol (VIP) wireless Ethernet bridge products and Til-Tek antennas continue worldwide. New product introductions, such as the Ultima3 and the T1/E1 solutions in the most recent quarter, further increase future sales potential.

    "With another two major customer contracts this quarter, including one with Motorola, Wi-LAN continues to show very significant progress in building current and future sales," said Hatim Zaghloul, chairman, president and chief executive officer, Wi-LAN Inc. "Although our sales declined marginally compared to the prior quarter, we believe that we are continuing to grow our share of the fixed wireless access market because sales of competing products have generally fared worse in recent quarters." In the second half of 2001, structural changes were put in place to improve the company's cash flow. These changes included significant staff and expenditure reductions. The fixed components of cash used in operations have been sharply reduced, while the variable components of cash used in operations going forward will only be incurred to support new sales. Fewer resources are required for product development as the main effort has shifted from development of the BWS 3000 series, based on Wi-LAN's patented W-OFDM technology, to product enhancements and cost reductions of selected products to improve gross margins and market penetration. Master service agreements and integrators have reduced the need for in-house network design.

    "Our continuing adherence to a strict cash management program has allowed Wi-LAN to thrive in a business environment that remains challenging," said Steven Bellamy, chief financial officer, Wi-LAN Inc. "With ongoing healthy sales and a focus on improving margins, Wi-LAN's finances continue to be secure."

    Operations highlights
    Several significant strategic initiatives were accomplished in the third quarter, including:

  • Motorola Contract -- on May 15, 2002, Wi-LAN announced in Stockwatch that it had signed a product supply, licence and distribution agreement with the commercial, government and industrial solutions sector (CGISS) of Motorola Inc. Under terms of the agreement, Motorola CGISS may purchase and/or license Wi-LAN's high-speed wireless data communications products and resell Wi-LAN's products through CGISS's sales channels. This agreement greatly increases the sales potential of Wi-LAN because Motorola's sales channels have Wi-LAN's full line of high-quality products at their disposal;
  • China Supply Contract -- on May 30, 2002, Wi-LAN announced in Stockwatch that it had received a 12-month purchase order for a minimum of $2.5-million ($1.65-million (U.S.)) of its new Ultima3 ER (extended range) and RD (rapid deployment) products from Wi-Comm United Communications Inc., a major reseller of Wi-LAN products to the Chinese marketplace, headquartered in Beijing. Monthly product shipments will begin in June, 2002.
  • New Product Launches
  • On May 29, 2002, Wi-LAN launched the AWE 120-58 Ultima3 fixed wireless access products based on its patented MC-DSSS (multicode direct sequence spread spectrum) technology. The Ultima3 series, the second generation of Wi-LAN's 5.8-gigahertz product line, provides improved scalability, multilayered security, automatic power control, tiered network service management, longer range coverage and a user-friendly network management interface, all in a rugged, weatherproof, single-unit design. The Ultima3 series includes rapid deployment and extended range products for point-to point applications, and access point (AP) and customer premises equipment (CPE) products for point-to-multipoint applications. The point-to-point systems can deliver a maximum of 12 megabits per second with a distance of up to 75 kilometres, and the point-to-multipoint systems can deliver a total throughput of 72 megabits per second per cell with a distance up to 16 kilometeres based on a six-sector design.
  • On July 31, 2002, Wi-LAN launched its wireless T1/E1 solutions, which convert voice channels into Internet protocol (IP) for transmission of voice messages over Wi-LAN's fixed wireless access systems. The wireless T1/E1 solutions allow transmission of up to 30 voice channels over licence-exempt frequency bands to provide a robust, reliable and cost-effective alternative to traditional leased T1 or E1 lines. The core of Wi-Lan's wireless T1/E1 solutions is the AWE, VIP and Ultima3 radios paired with the TEmux T1/E1 multiplexer. They provide easy connectivity to existing T1/E1 networks to deliver broadband wireless voice capability with a range of up to 75 kilometres.
  • Patent litigation
    On July 24, 2002, Wi-LAN announced in Stockwatch that it had commenced legal action in Canada against a private Canadian company claiming to produce a non-line-of-sight, fixed wireless device using advanced orthogonal frequency division multiplexing (OFDM) technology. It is Wi-LAN's belief that this device infringes Wi-LAN's Canadian patent No. 2,064,975.

    Product Improvements and Certifications
  • On May 1, 2002, Wi-LAN announced in Stockwatch that its VIP 110-24 product, which incorporates its patent-pending VINE technology, now features software that enables service providers to remotely manage their networks. In addition, the VIP 110-24 has recently been certified by the state regulatory radio commission of the People's Republic of China. With this certification, the VIP 110-24 is certified for use in all major telecommunications markets worldwide, having previously received certification from the U.S. Federal Communications Commission (FCC), Industry Canada (IC) and the CE mark indicating the product conforms to the standards of the European Telecommunications Standards Institute (ETSI).
  • On May 7, 2002, Wi-LAN announced in Stockwatch that its market-leading BWS 3000 series products, based on its patented W-OFDM technology, can now be upgraded to double throughput with full duplex capability. Service providers with 3.5-megahertz channel widths can now double the capacity of their available spectrum while maintaining the same coverage area.


  • Wireless standards progress
  • Wi-LAN hosted a meeting of the Institute of Electrical and Electronics Engineers (IEEE) Standards Association's 802.16 working group from May 20 to May 24, 2002, in Calgary, Canada. The group is working to finalize the universal standard for fixed broadband wireless access systems in the two-gigahertz to 11-gigahertz radio frequencies. IEEE Standard 802.16, published in March, 2002, defines a standard for broadband wireless access systems operating over 11 gigahertz. The project advanced at this meeting will enhance the physical layer (PHY) and medium access control layer (MAC) of the existing standard to optimize it for radio frequencies from two gigahertz to 11 gigahertz.


  • Quarterly consolidated results
    Wi-LAN intends to release its consolidated results for the three months ended July 31, 2002, on Sept. 18, 2002, after the markets close. A conference call to discuss the results will be held on Sept. 19 at 11 a.m. ET. Details with regard to the call will be press released and posted on Wi-LAN's Web site at www.wilan.com.

    About Wi-LAN Inc.
    Wi-LAN is a global innovator in the field of high-speed wireless data communications, specializing in high-speed Internet access, LAN/WAN extension and broadband wireless access. Wi-LAN is the Chair Company of the OFDM Forum (www.ofdm-forum.com). Wi-LAN believes its W-OFDM patent is necessary for the implementation of devices using the IEEE 802.11a, IEEE 802.11g or ETSI BRAN HiperLAN/2 standards. Wi-LAN's products are known worldwide for their high quality and industry-leading technology. Wi-LAN's common shares trade on The Toronto Stock Exchange under the symbol "WIN." Detailed information on Wi-LAN can be found at www.wilan.com.

    Forward Looking Information
    Certain statements in this release, other than statements of historical fact, are forward-looking information that involves various risks and uncertainties. These can include, without limitation, statements based on current expectations involving a number of risks and uncertainties related to all aspects of the wireless data communications industry. These risks and uncertainties include, but are not restricted to, continued increased demand for the Company's products, the Company's ability to maintain its technological leadership in the field of high-speed data communications, the Company's ability to attract and maintain key employees, the enforceability of the Company's patents, and the availability of key components.

    These uncertainties may cause actual results to differ from information contained herein. There can be no assurance that such statements will prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral forward-looking statements are based on the estimates and opinions of management on the dates they are made and expressly qualified in their entirety by this notice. The Company assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change.

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