Intermec Reports Second Quarter 2009 Results in-Line with Guidance

* Q2`09 Revenue of $158 Million, Cash Increases to $227 Million
* Q2`09 EPS Loss of ($0.11), excluding Restructuring EPS Loss of ($0.03)

EVERETT, Wash.--(Business Wire)--
Intermec, Inc. (NYSE:IN) today announced financial results for its second
quarter, which ended June 28, 2009.

Second quarter 2009 revenues were $158 million with a net loss of ($6.5)
million, or ($0.11) per diluted share, compared to 2008 second quarter revenues
of $218 million and net earnings of $7.7 million, or $0.13 per diluted share.

"Intermec executed well in a challenging economic environment, delivering within
our quarterly guidance and generating cash," said Patrick J. Byrne, Intermec`s
president and CEO. "Our recent new product introductions, channel expansion
programs, and lower break even point position us well for market recovery."

The following table presents our GAAP (loss) earnings from operations before
taxes, net (loss) earnings, and diluted (loss) earnings per share as reported
for the second quarters of 2009 and 2008, and as adjusted by excluding the
impact of restructuring charges.

Quarter Ended June 28, 2009 Quarter Ended June 29, 2008
($ in millions, except per share amounts) (Loss) earnings from operations before taxes Net (loss) earnings Diluted (loss) earnings per share Earnings from operations before taxes Net earnings Diluted earnings per share

Earnings as Reported $ (10.3 ) $ (6.5 ) $ (0.11 ) $ 11.1 $ 7.7 $ 0.13
Restructuring charges $ 7.3 $ 4.7 $ 0.08 - - -

Earnings as Adjusted $ (3.0 ) $ (1.8 ) $ (0.03 ) $ 11.1 $ 7.7 $ 0.13

Second Quarter 2009 Operating Performance

* Total revenues of $158 million were down 28% from the prior year quarter.
Approximately 5 percentage points of the decline was due to currency
translation.
* Geographically, North American revenues declined 22% over the comparable
prior-year period. Revenues in Europe, Middle East and Africa (EMEA) were down
36% from the prior year period with approximately 12 percentage points of the
decline due to currency translation. Latin American revenues decreased 34%, and
Asia Pacific (APAC) revenues decreased 21%, both over the comparable prior-year
period.
* From a product line perspective, Systems and Solutions revenue decreased 33%
and Printer and Media revenue declined 28% both over the comparable prior-year
period. Service revenue was 9% below the prior-year period.
* Gross profit margins decreased 4.5 percentage points to 36.2%, and product
gross margins decreased 5.6 percentage points to 34.4%, both compared to the
second quarter of 2008. The gross profit margin decline was attributable to the
competitive and economic environment, reduced product volumes, product and
geographical mix and the impact of currency translation. Service gross margins
of 42.7% declined 1.3 percentage points from over the second quarter of 2008.
* Operating expenses excluding restructuring charges were $60.1 million, down
23%, compared to $77.8 million in the second quarter 2008. There were no
restructuring charges in the second quarter of 2008.
* Included in second quarter 2009 results are pre-tax restructuring charges of
$7.3 million or ($0.08) per diluted share relating to business restructuring
plans announced in 2009. Excluding these charges the non-GAAP adjusted net loss
for the second quarter of 2009 was ($1.8) million, or ($0.03) per diluted share,
as compared with the prior year second quarter`s net income of $7.7 million, or
$0.13 per diluted share, as described in the Non-GAAP (Adjusted) Financial
Measures section of this release.
* The Company`s second quarter 2009 effective tax rate was approximately 36%,
consistent with the prior-year comparable quarter.
* Operating cash flow was positive $8 million in the quarter, including the
impact of cash paid for restructuring of $4 million.
* The Company`s cash and cash equivalents increased during the quarter to $227
million. The Company has no debt.

Recent Product Introductions

* During the quarter we announced the CN4, the most lightweight, fully rugged
3.5G mobile computer in its class - designed to perform in the most demanding
work environments. With a six-foot drop specification - on all faces, sides and
corners, compact internal antenna design, and IP64 sealing - the CN4 can reduce
worker downtime and the risk of critical data or revenue loss. The CN4
integrates with a wide range of performance-optimized printers and accessories
for in-vehicle or stand-alone implementation, and leverages system software and
a wide range of accessories with Intermec`s leading CN3-series.
* We also announced the CN50 high performing 3.75G mobile computer, which is
optimally designed for "hold and carry" environments and direct customer
interactions. The CN50 enables mobile workers to run data-intensive applications
in a small, lightweight and ruggedized form factor. The CN50 features numerous
performance innovations, including a Flexible NetworkTM Radio that can be
re-provisioned to a different network as business needs or coverage options
evolve. This capability enables customers to deploy a single hardware solution
on the wireless network offering the best cost and geographic coverage.

The CN50 and CN4 are both available with an optional Enhanced Mobile Document
Imaging (eMDI) capability, providing mobile workers with a fast, reliable way to
convert full page paper documents into electronic documents at the
point-of-transaction. With eMDI-enabled devices, mobile workers now have the
ability to transmit high-quality document images, captured in all lighting
conditions, to back office applications in real-time.

* Intermec also added five new rugged mobile printers to its PB product family -
the PB21, PB22, PB31, PB32 and PB51. The new printers feature two times more
memory, print twenty to thirty percent faster than competing solutions, and are
the industry`s only "Smart" rugged mobile receipt, label and invoice printers.
The two, three, and four inch printers enable mobile workforces in route
accounting, transportation and logistics, retail and field service applications
to print high quality, graphically complex receipts. In addition, an enhanced
version of the successful PB50 is now available, including an improved label
self strip feature and media holder.

Outlook - Third Quarter 2009

Intermec announced its financial forecast for the third quarter of 2009.

* Revenues are expected to be within a range of $165 to $175 million.
* Earnings (loss) per share are expected to be within a range of ($0.08) to
($0.03) per diluted share, including the expected impact of approximately
($0.06) for the restructuring plans announced in 2009. Excluding these
restructuring charges the non-GAAP adjusted earnings (loss) per share are
expected to be within a range of ($0.02) to $0.03 per diluted share.

Conference Call Information

Intermec will hold its conference call on July, 30 2009 at 5 p.m. ET (2 p.m.
PT). The dial-in numbers for participants are 1 517-308-9090 (US and
International) 1 800-621-8495 (Toll free); Passcode: ("Intermec"). The call will
be broadcast on the Internet via a link from the investor`s Web page at
www.intermec.com/InvestorRelations.

Non-GAAP (Adjusted) Financial Measures

This press release includes non-GAAP (adjusted) financial measures for earnings
(loss) from operations before taxes, net (loss) earnings, and earnings (loss)
per diluted share. It also includes an outlook for the third quarter 2009
non-GAAP (adjusted) earnings (loss) per diluted share. Reconciliations of each
of these non-GAAP financial measures to the most directly comparable GAAP
financial measures are detailed in the Reconciliation of GAAP to Non-GAAP Net
Earnings attached to this press release.

Our non-GAAP measures should be read in conjunction with the corresponding GAAP
measures. The non-GAAP measures should be considered in addition to and not as
an alternative or substitute for the measures prepared in accordance with
generally accepted accounting principles.

We believe that excluding restructuring charges (principally related to
severance costs in connection with distinct organizational initiatives to reduce
costs and improve operational efficiency) provides supplemental information
useful to investors` and management`s understanding of the company`s core
operating results, especially when comparing those results on a consistent basis
to results for previous periods and anticipated results for future periods.

About Intermec, Inc.

Intermec Inc. (NYSE:IN) develops and integrates products, services and
technologies that identify, track and manage supply chain assets and
information. Core technologies include rugged mobile computing and data
collection systems, bar code printers, label media, and RFID. The company`s
products and services are used by customers in many industries worldwide to
improve the productivity, quality and responsiveness of business operations. For
more information about Intermec, visit www.intermec.com or call 800-347-2636.

(Forward-looking Statements)

Statements made in this release and related statements that express Intermec`s
or our management`s intentions, hopes, indications, beliefs, expectations,
guidance, estimates, forecasts or predictions of the future constitute
forward-looking statements, as defined by the Private Securities Litigation
Reform Act of 1995, and relate to matters that are not historical facts. They
include, without limitation, statements regarding: our cost reduction plans; our
view of general economic and market conditions; and our revenue, expense,
earnings or financial outlook for the third quarter of 2009 or any current or
future period.They also include statements about our ability to develop,
produce, market or sell our products, either directly or through third parties,
reduce expenses, improve efficiency, realign resources, continue operational
improvement and year-over-year growth, and about the applicability of accounting
policies used in our financial reporting. These statements represent beliefs and
expectations only as of the date they were made. We may elect to update
forward-looking statements but we expressly disclaim any obligation to do so,
even if our beliefs and expectations change. Actual results may differ from
those expressed or implied in our forward-looking statements. Such
forward-looking statements involve and are subject to certain risks and
uncertainties. These include, but are not limited to, risks and uncertainties
described more fully in our reports filed or to be filed with the Securities and
Exchange Commission including, but not limited to, our annual reports on Form
10-K and quarterly reports on Form 10-Q.

INTERMEC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands except per share amounts)
(Unaudited)

Three Months Ended Six Months Ended
June June June June
28, 2009 29, 2008 28, 2009 29, 2008

Revenues
Product $ 123,339 $ 180,455 $ 252,002 $ 360,028
Service 34,376 37,806 68,286 75,011
Total revenues 157,715 218,261 320,288 435,039

Costs and Expenses
Cost of product revenues 80,927 108,189 164,293 215,894
Cost of service revenues 19,714 21,154 39,851 42,859
Research and development 15,375 17,822 31,288 35,015
Selling, general and administrative 44,711 58,828 95,719 116,793
Restructuring charges 7,345 - 15,927 -
Flood related charge - 1,122 - 1,122
Total costs and expenses 168,072 207,115 347,078 411,683

Operating (loss) profit (10,357 ) 11,146 (26,790 ) 23,356
Interest income 261 1,171 602 2,846
Interest expense (227 ) (345 ) (452 ) (2,135 )
(Loss) earnings before taxes (10,323 ) 11,972 (26,640 ) 24,067
Income tax (benefit) expense (3,781 ) 4,250 (9,698 ) 8,639
Net (loss) earnings $ (6,542 ) $ 7,722 $ (16,942 ) $ 15,428

Basic (loss) earnings per share $ (0.11 ) $ 0.13 $ (0.28 ) $ 0.25

Diluted (loss) earnings per share $ (0.11 ) $ 0.13 $ (0.28 ) $ 0.25

Shares used in computing basic (loss) earnings per share 61,606 61,103 61,532 61,030
Shares used in computing diluted (loss) earnings per share 61,606 61,611 61,532 61,543

INTERMEC, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)

June December
28, 2009 31, 2008
ASSETS

Current assets:
Cash and cash equivalents $ 227,075 $ 221,335
Short-term investments 132 156
Accounts receivable, net of allowance for doubtful accounts and sales returns of $8,188 and $10,789 106,260 138,549
Inventories 92,348 116,949
Net current deferred tax assets 66,568 56,295
Other current assets 18,041 14,405
Total current assets 510,424 547,689

Property, plant and equipment, net 38,924 41,348
Intangibles, net 3,006 3,521
Net deferred tax assets 153,428 167,834
Other assets 31,137 29,503
Total assets $ 736,919 $ 789,895

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 78,964 $ 112,772
Payroll and related expenses 31,924 24,799
Deferred revenues 41,280 38,712
Total current liabilities 152,168 176,283

Long-term deferred revenues 22,219 25,980
Pension liability 53,158 92,129
Other long-term liabilities 12,478 13,747

Commitments

Shareholders' equity:
Common stock (250,000 shares authorized, 62,038 and 61,766 shares issued and outstanding) 620 618
Additional paid-in-capital 698,789 694,296
Accumulated deficit (179,344 ) (162,402 )
Accumulated other comprehensive loss (23,169 ) (50,756 )
Total shareholders' equity 496,896 481,756
Total liabilities and shareholders' equity $ 736,919 $ 789,895

INTERMEC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Six months ended
June 28 June 29
2009 2008

Cash and cash equivalents at beginning of the period $ 221,335 $ 237,247

Cash flows from operating activities:
Net (loss) earnings (16,942 ) 15,428
Adjustments to reconcile net (loss) earnings to net cash provided by operating activities:
Depreciation and amortization 7,846 7,842
Deferred taxes (10,634 ) 7,295
Excess tax shortfall (benefit) from stock-based payment arrangements 547 (1,340 )
Change in operating assets and liabilities:
Accounts receivable 32,289 31,823
Inventories 24,516 (27,481 )
Accounts payable and accrued expenses (34,968 ) (21,754 )
Payroll and related expenses 7,125 (3,192 )
Other operating activities (1,970 ) 13,795
Net cash provided by operating activities 7,809 22,416

Cash flows from investing activities:
Capital expenditures (4,720 ) (5,779 )
Proceeds from sale of property 1,867 5,497
Purchases of investments - (760 )
Sale of investments - 28,515
Capitalized patent legal fees (2,321 ) (778 )
Net cash (used in) provided by investing activities (5,174 ) 26,695

Cash flows from financing activities:
Repayment of debt - (100,000 )
Excess tax (shortfall) benefit from stock-based payment arrangements (547 ) 1,340
Stock options exercised 218 3,595
Other financing activities 652 1,559
Net cash provided by (used in) financing activities 323 (93,506 )

Effect of exchange rate changes on cash and cash equivalents 2,782 6,162

Resulting increase (decrease) in cash and cash equivalents 5,740 (38,233 )

Cash and cash equivalents at end of the period $ 227,075 $ 199,014

INTERMEC, INC.
RECONCILIATION OF GAAP TO NON-GAAP NET EARNINGS
(Unaudited, amounts in thousands except per share amounts)

Three Months Ended Six Months Ended
June Non GAAP Adjusted June June Non GAAP Adjusted June
28, 2009 Adjustments June 28, 2009 29, 2008 28, 2009 Adjustments June 28, 2009 29, 2008

Revenues
Product $ 123,339 $ 123,339 $ 180,455 $ 252,002 $ 252,002 $ 360,028
Service 34,376 34,376 37,806 68,286 68,286 75,011
Total revenues 157,715 157,715 218,261 320,288 320,288 435,039

Costs and Expenses
Cost of product revenues 80,927 80,927 108,189 164,293 164,293 215,894
Cost of service revenues 19,714 19,714 21,154 39,851 39,851 42,859
Research and development 15,375 15,375 17,822 31,288 31,288 35,015
Selling, general and administrative 44,711 44,711 58,828 95,719 95,719 116,793
Flood related charge - - 1,122 - - 1,122
Restructuring 7,345 (7,345 ) - - 15,927 (15,927 ) - -
Total costs and expenses 168,072 (7,345 ) 160,727 207,115 347,078 (15,927 ) 331,151 411,683
- -
Operating (loss) profit (10,357 ) 7,345 (3,012 ) 11,146 (26,790 ) 15,927 (10,863 ) 23,356
Interest income 261 261 1,171 602 602 2,846
Interest expense (227 ) (227 ) (345 ) (452 ) (452 ) (2,135 )
(Loss) earnings before taxes (10,323 ) 7,345 (2,978 ) 11,972 (26,640 ) 15,927 (10,713 ) 24,067
Income tax (benefit) expense (3,781 ) 2,701 (1,080 ) 4,250 (9,698 ) 5,770 (3,928 ) 8,639
Net (loss) earnings (6,542 ) 4,644 (1,898 ) 7,722 (16,942 ) 10,157 (6,785 ) 15,428

Basic (loss) earnings per share $ (0.11 ) $ 0.08 $ (0.03 ) $ 0.13 $ (0.28 ) $ 0.16 $ (0.11 ) $ 0.25

Diluted (loss) earnings per share $ (0.11 ) $ 0.08 $ (0.03 ) $ 0.13 $ (0.28 ) $ 0.16 $ (0.11 ) $ 0.25

Shares used in computing basic (loss) earnings per share 61,606 61,606 61,606 61,103 61,532 61,606 61,606 61,030
Shares used in computing diluted (loss) earnings per share 61,606 61,606 61,606 61,611 61,532 61,606 61,606 61,543

INTERMEC, INC.
RECONCILIATION OF GAAP TO NON-GAAP OUTLOOK FOR THE QUARTER ENDED SEPTEMBER 27, 2009
(Unaudited)

Diluted (loss)
earnings per
share

As Reported $ (0.08) to (0.03 )
Restructuring charge $ 0.06

As Adjusted $ (0.02) to 0.03

Intermec, Inc.
Kevin P. McCarty, Director, Investor Relations, 425-265-2472
kevin.mccarty@intermec.com

Copyright Business Wire 2009

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