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Zebra Technologies Announces Record Sales for the 2014 Second Quarter

Companies mentioned in this article: Zebra Technologies Corporation

LINCOLNSHIRE, Ill., Aug. 5, 2014 /PRNewswire/ -- Zebra Technologies Corporation (NASDAQ: ZBRA) today reported record 2014 second quarter net sales of $288,421,000, up 13.9% from $253,160,000 for the second quarter of 2013. Diluted earnings per share of $0.54 for the second quarter of 2014 include $20,364,000 in acquisition expenses related to the pending acquisition of the Enterprise business of Motorola Solutions, which was announced on April 15, 2014. Diluted earnings per share for the second quarter of 2013 were $0.60 and include $618,000 of acquisition expenses.

For the second quarter of 2014, non-GAAP net income was $43,265,000, or $0.84 per diluted share, up 35.5% from $31,959,000, or $0.62 per diluted share, for the second quarter of 2013.


             Summary Financial Performance (Unaudited)
              ----------------------------------------

                  2Q14                           2Q13                  Change
                  ----                           ----                  ------

     Net
     sales
     (in
     000s)                $288,421                     $253,160                 13.9%

     Gross
     margin
     (%)                     49.3                         47.8  1.5 pts.


     GAAP
     net
     income
     (in
     000s)                 $27,557                      $30,566                (9.8)%

     GAAP
     Diluted
     EPS                     $0.54                        $0.60               (10.0)%


     Non-
     GAAP
     net
     income
     (in
     000s)                 $43,265                      $31,959                 35.4%

     Non-
     GAAP
     Diluted
     EPS                     $0.84                        $0.62                 35.5%


    (1)                A Reconciliation of Non-GAAP
                       financial information to GAAP
                       information is available in the
                       financial tables in this release.

"Zebra continued to extend its industry leadership, with effective execution on a proven business strategy," stated Anders Gustafsson, Zebra's chief executive officer. "Our singular focus of delivering products and solutions that deliver increasing levels of visibility into the operations of our customers is driving more business and greater opportunities for growth. During the second quarter, we made good progress on integration planning for the pending acquisition of Motorola's Enterprise business. We remain enthusiastic about the compelling strategy supporting the transaction. The combination of the businesses will make Zebra the industry leader in Asset Enterprise Intelligence, and position the company to increasingly benefit from important trends in mobility, cloud computing and data analytics."

As of June 28, 2014, Zebra had $528,581,000 in cash and investments, and no long-term debt. Net inventories were $126,103,000, and net accounts receivable were $165,426,000.

Discussion and Analysis - Second Quarter

    --  Net sales growth of 13.9% from the comparable quarter a year ago
        resulted from sales growth across all product categories, with notable
        increases in supplies, services, and tabletop, desktop and mobile
        printers. The increase in service revenue was modestly affected by the
        December 2013 acquisition of Hart Systems LLC, which also contributed to
        growth in North American sales. Performance in North American sales also
        reflects an increase in shipments of large enterprise deals. The Europe,
        Middle East and Africa region benefited from improved business activity,
        with notable sales to retail customers. Movement in foreign currency,
        net of hedges, increased sales by $3,523,000.
    --  Gross margin of 49.3%, versus 47.8% in 2013, reflects higher sales
        across all regions and product volumes across all product categories,
        lower product costs, and a reduction in freight costs. Favorable
        movements in foreign currency, net of hedges, increased second quarter
        gross profit by $1,867,000
    --  Operating expenses for the second quarter increased 28.9%, primarily as
        a result of increased compensation, acquisition and amortization costs
        as a result of the December 2013 acquisition of Hart Systems LLC.
        Acquisition costs consist of transactions costs and integration
        activities related to the pending acquisition of the Enterprise business
        of Motorola Solutions, which was announced in April 2014.
    --  During the second quarter, Zebra entered into forward interest rate
        swaps to hedge potential movements in interest rates associated with the
        anticipated debt funding for the acquisition of Motorola's Enterprise
        business. A decline in interest rates resulted in a $2,433,000 loss in
        the value of the hedging instruments for the quarter.
    --  Effective income tax rate of 11.1% reflects the effect of acquisition
        costs on income primarily in the U.S. These higher costs are resulting
        in a higher than normal percentage of income generated from
        jurisdictions with lower effective income tax rates.

Third Quarter Outlook

Zebra announced its financial forecast for the third quarter of 2014. Net sales are expected within a range of $285,000,000 to $295,000,000. Non-GAAP earnings per share are expected within a range of $0.81 to $0.91, excluding certain expenses including those associated with the acquisition of Motorola's Enterprise business, and assuming an income tax rate of 20.0%.

Conference Call Notification

Investors are invited to listen to a live webcast of Zebra's conference call discussing the company's financial results for the second quarter of 2014. The conference call will be held at 9:00 AM Eastern Time today. To listen to the call, visit the company's website at http://www.zebra.com.

Forward-looking Statement

This press release contains forward-looking statements, as defined by the Private Securities Litigation Reform Act of 1995, including, without limitation, the statements regarding the company's financial forecast for the third quarter of 2013 stated in the paragraph above captioned "Third Quarter Outlook." Similarly, statements herein that describe the proposed transaction between Zebra and Motorola Solutions including, its financial impact, and other statements of managements' beliefs, intentions, or goals are also forward-looking statements. Actual results may differ from those expressed or implied in the company's forward-looking statements. These statements represent estimates only as of the date they were made. Zebra undertakes no obligation, other than as may be required by law, to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason after the date of this release.

These forward-looking statements are based on current expectations, forecasts and assumptions and are subject to the risks and uncertainties inherent in Zebra's industry, market conditions, general domestic and international economic conditions, and other factors. These factors include customer acceptance of Zebra's hardware and software products and competitors' product offerings, and the potential effects of technological changes. The continued uncertainty over future global economic conditions, the availability of credit, capital markets volatility, may have adverse effects on Zebra, its suppliers and its customers. In addition, a disruption in our ability to obtain products from vendors as a result of supply chain constraints, natural disasters or other circumstances could restrict sales and negatively affect customer relationships. Profits and profitability will be affected by Zebra's ability to control manufacturing and operating costs. Because of a large investment portfolio, interest rates and financial market conditions will also have an impact on results. Foreign exchange rates will have an effect on financial results because of the large percentage of our international sales. The outcome of litigation in which Zebra may be involved is another factor. The success of integrating acquisitions, including Hart Systems, could also affect profitability, reported results and the company's competitive position in it industry. These and other factors could have an adverse effect on Zebra's sales, gross profit margins and results of operations and increase the volatility of our financial results. When used in this release and documents referenced, the words "anticipate," "believe," "estimate," and "expect" and similar expressions, as they relate to the company or its management, are intended to identify such forward-looking statements, but are not the exclusive means of identifying these statements. Descriptions of the risks, uncertainties and other factors that could affect the company's future operations and results can be found in Zebra's filings with the Securities and Exchange Commission. In particular, readers are referred to Zebra's Form 10-K for the year ended December 31, 2013.

About Zebra Technologies

A global leader in enterprise asset intelligence, Zebra Technologies Corporation (NASDAQ: ZBRA) offers solutions that give a virtual voice to an organization's assets, people and transactions, enabling organizations to unlock greater business value. The company's extensive portfolio of innovative and reliable marking and printing products, RFID and real-time location solutions, illuminates mission-critical information that help customers take smarter business actions. For more information about Zebra's solutions, visit http://www.zebra.com.

Use of Non-GAAP Financial Information

This press release contains certain non-GAAP financial measures, consisting of "EBITDA," "Adjusted EBITDA," "Non-GAAP net income" and "Non-GAAP earnings per share" in addition to measure our operating performance. Management presents these measures to focus on the on-going operations and believes it is useful to investors because they enable them to perform meaningful comparisons of past and present operating results. Reconciliations of Operating Income to EBITDA, EBITDA to Adjusted EBITDA, and GAAP net income to Non-GAAP net income are included in the financial schedules contained in this press release. These measures, however, should not be construed as an alternative to any other measure of performance determined in accordance with GAAP.


    Contact:

    Investors:                         Media:
    ----------                         ------

    Douglas A. Fox, CFA                Robb Kristopher

    Vice President, Investor Relations Director, Corporate Communications

    and Treasurer                      and Public Relations

    + 1 847 793 6735                   + 1 847 793 5514

    dfox@zebra.com                     rkristopher@zebra.com




                                          ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

                                                    CONSOLIDATED BALANCE SHEETS

                                                      (Amounts in thousands)




                                                               June 28,                   December 31,
                                                                                2014                         2013
                                                                                ----                         ----

    ASSETS                                                   (Unaudited)

    Current assets:

    Cash and cash equivalents                                                $70,349                      $62,827

    Investments and marketable
     securities                                                              455,644                      350,380

    Accounts receivable, net                                                 165,426                      176,917

    Inventories, net                                                         126,103                      121,023

    Deferred income taxes                                                     19,810                       19,810

    Income tax receivable                                                      8,860                        7,622

    Prepaid expenses and other
     current assets                                                           13,055                       15,524

    Total current assets                                                     859,247                      754,103
                                                                             -------                      -------


    Property and equipment at cost,
     less accumulated depreciation
     and amortization                                                        107,115                      109,588

    Goodwill                                                                 155,800                      155,800

    Other intangibles, net                                                    63,629                       68,968

    Other assets                                                              33,178                       31,353
                                                                              ------                       ------

                       Total assets                                       $1,218,969                   $1,119,812
                                                                          ==========                   ==========


    LIABILITIES AND STOCKHOLDERS' EQUITY


    Current liabilities:

    Accounts payable                                                         $31,752                      $34,688

    Accrued liabilities                                                       65,518                       61,962

    Deferred revenue                                                          16,896                       15,506

    Income taxes payable                                                       9,112                        6,898

    Total current liabilities                                                123,278                      119,054

    Long-term deferred tax liability                                          28,471                       25,492

    Deferred rent                                                              1,484                        1,131

    Other long-term liabilities                                               17,674                       15,477
                                                                              ------                       ------

                       Total liabilities                                     170,907                      161,154
                                                                             -------                      -------


    Stockholders' equity:

    Class A Common Stock                                                         722                          722

    Additional paid-in capital                                               149,475                      143,295

    Treasury stock                                                         (666,084)                   (678,456)

    Retained earnings                                                      1,572,041                    1,502,878

    Accumulated other comprehensive
     loss                                                                    (8,092)                     (9,781)
                                                                              ------                       ------

               Total stockholders' equity                                  1,048,062                      958,658
                                                                           ---------                      -------

                  Total liabilities and
                   stockholders' equity                                   $1,218,969                   $1,119,812
                                                                          ==========                   ==========




                                                           ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

                                                                 CONSOLIDATED STATEMENTS OF EARNINGS

                                                            (Amounts in thousands, except per share data)

                                                                             (Unaudited)




                                Three Months Ended                      Six Months Ended
                                ------------------                      ----------------

                                     June 28,                               June 29,                       June 28,          June 29,
                                                      2014                                     2013                     2014              2013
                                                      ----                                     ----                     ----              ----

    Net sales:

      Net sales of tangible
       products                                   $270,049                                 $239,909                 $531,941          $465,030

      Revenue from services
       and software                                 18,372                                   13,251                   44,748            25,067
                                                    ------                                   ------                   ------            ------

    Total net sales                                288,421                                  253,160                  576,689           490,097
                                                   -------                                  -------                  -------           -------


    Cost of sales:

      Cost of sales of
       tangible products                           136,962                                  125,664                  267,411           242,775

      Cost of services and
       software                                      9,290                                    6,589                   19,171            13,350
                                                     -----                                    -----                   ------            ------

    Total cost of sales                            146,252                                  132,253                  286,582           256,125
                                                   -------                                  -------                  -------           -------


    Gross profit                                   142,169                                  120,907                  290,107           233,972
                                                   -------                                  -------                  -------           -------


    Operating expenses:

       Selling and marketing                        35,755                                   33,830                   71,171            67,345

       Research and
        development                                 23,710                                   23,201                   46,567            45,059

       General and
        administrative                              26,321                                   24,053                   54,712            49,329

       Amortization of
        intangible assets                            2,667                                    1,863                    5,339             3,726

       Acquisition costs                            20,364                                      618                   25,291             1,100

       Exit and
        restructuring costs                            287                                    1,101                      554             2,996

    Total operating
     expenses                                      109,104                                   84,666                  203,634           169,555
                                                   -------                                   ------                  -------           -------


    Operating income                                33,065                                   36,241                   86,473            64,417
                                                    ------                                   ------                   ------            ------


    Other income (expense):

       Investment income                               379                                      473                      800             1,150

       Foreign exchange
        income (loss)                                   43                                    (462)                   (249)            (560)

       Loss on interest rate
        swaps                                      (2,433)                                       0                  (2,433)                0

       Other, net                                     (57)                                   1,464                     (49)            1,473
                                                       ---                                    -----                      ---             -----

    Total other income                             (2,068)                                   1,475                  (1,931)            2,063
                                                    ------                                    -----                   ------             -----


    Income from
     continuing
     operations before
     income taxes                                   30,997                                   37,716                   84,542            66,480

    Income taxes                                     3,440                                    7,158                   15,379            12,380
                                                     -----                                    -----                   ------            ------


    Income from
     continuing
     operations                                     27,557                                   30,558                   69,163            54,100

    Income from
     discontinued
     operations, net of
     tax                                                 0                                        8                        0                 8
                                                       ---                                      ---                      ---               ---

    Net income                                     $27,557                                  $30,566                  $69,163           $54,108
                                                   =======                                  =======                  =======           =======


    Basic earnings per share:

       Income from
        continuing
        operations                                   $0.54                                    $0.60                    $1.37             $1.06

       Income from
        discontinued
        operations                                    0.00                                     0.00                     0.00              0.00
                                                      ----                                     ----                     ----              ----

          Net income                                 $0.54                                    $0.60                    $1.37             $1.06
                                                     =====                                    =====                    =====             =====

    Diluted earnings per share:

       Income from
        continuing
        operations                                   $0.54                                    $0.60                    $1.35             $1.05

       Income from
        discontinued
        operations                                    0.00                                     0.00                     0.00              0.00
                                                      ----                                     ----                     ----              ----

          Net income                                 $0.54                                    $0.60                    $1.35             $1.05
                                                     =====                                    =====                    =====             =====


    Basic weighted
     average shares
     outstanding                                    50,606                                   50,900                   50,509            50,929

    Diluted weighted
     average and
     equivalent shares
     outstanding                                    51,278                                   51,283                   51,129            51,310




                                                                  ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

                                                                  CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

                                                                              (Amounts in thousands)

                                                                                    (Unaudited)




                                       Three Months Ended                        Six Months Ended
                                       ------------------                        ----------------

                                         June 28, 2014                             June 29, 2013                  June 28, 2014         June 29, 2013
                                         -------------                             -------------                  -------------         -------------


    Net income                                            $27,557                                    $30,566                    $69,163               $54,108


    Other comprehensive income (loss):

       Unrealized gains (losses)
        on hedging transactions,
        net of income taxes                                   776                                      (391)                     1,389                 1,352

       Unrealized holding gains
        (losses) on investments,
        net of income taxes                                   348                                      (867)                       496                 (939)

       Foreign currency
        translation adjustment                               (29)                                       223                      (196)                  317


    Comprehensive income                                  $28,652                                    $29,531                    $70,852               $54,838
                                                          =======                                    =======                    =======               =======




                                           ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

                                                CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                        (Amounts in thousands)

                                                             (Unaudited)




                                                                        Six Months Ended
                                                                        ----------------

                                                                         June 28, 2014        June 29, 2013
                                                                         -------------        -------------

    Cash flows from operating activities:

            Net income                                                                $69,163               $54,108

            Adjustments to reconcile net income to net cash
             provided by (used in)

            operating activities:

                    Depreciation and
                     amortization                                                      18,096                15,412

                    Share-based compensation                                            7,110                 6,504

                    Excess tax benefit from
                     share-based compensation                                         (3,947)              (3,727)

                    Loss on sale of property
                     and equipment                                                         49                   182

                    Deferred income taxes                                               2,979                 4,439

                    Loss on forward interest
                     rate swaps                                                         2,433                     0

                    Changes in assets and liabilities:

                            Accounts receivable, net                                   11,359               (1,976)

                            Inventories, net                                          (5,061)               14,190

                            Other assets                                                2,583                 1,313

                            Accounts payable                                          (5,336)                3,263

                            Accrued liabilities                                         3,535               (6,094)

                            Deferred revenue                                              502                 1,585

                            Income taxes                                                4,706                   476

                            Other operating activities                                  1,742                 1,381

                                    Net cash provided by
                                     operating activities                             109,913                91,056
                                                                                      -------                ------


    Cash flows from investing activities:

            Purchases of property and
             equipment                                                                (7,962)              (8,547)

            Acquisition of intangible
             assets                                                                         0                 (500)

            Purchase of long-term
             investments                                                              (1,213)                (604)

            Purchase of investments and
             marketable securities                                                  (276,400)            (231,174)

            Maturities of investments
             and marketable securities                                                 20,852                19,188

            Proceeds from sales of
             investments and marketable
             securities                                                               150,781               142,230

                                    Net cash used in investing
                                     activities                                     (113,942)             (79,407)
                                                                                     --------               -------


    Cash flows from financing activities:

            Purchase of treasury stock                                                      0              (28,563)

            Proceeds from exercise of
             stock options and stock
             purchase plan purchases                                                    7,711                 4,104

            Excess tax benefit from
             share-based compensation                                                   3,947                 3,727

                                    Net cash provided by (used
                                     in) financing activities                          11,658              (20,732)
                                                                                       ------               -------


    Effect of exchange rate
     changes on cash                                                                    (107)                  229
                                                                                         ----                   ---


    Net increase (decrease) in
     cash and cash equivalents                                                          7,522               (8,854)

    Cash and cash equivalents
     at beginning of period                                                            62,827                64,740
                                                                                       ------                ------

    Cash and cash equivalents
     at end of period                                                                 $70,349               $55,886
                                                                                      =======               =======


    Supplemental disclosures of cash flow information:

     Income taxes paid, net                                                            $7,627                $5,346




                                                    ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

                                                            SUPPLEMENTAL SALES INFORMATION

                                                                (Amounts in thousands)

                                                                      (Unaudited)


                                                          SALES BY PRODUCT CATEGORY


                 Three Months Ended
                 ------------------

                      June 28,        June 29,                              Percent                 Percent of            Percent of

    Product
     Category                    2014              2013                        Change               Net Sales 2014        Net Sales 2013
    ---------                    ----              ----                        ------               --------------        --------------

    Hardware                 $203,215          $178,938                                  13.6                        70.5                  70.8

    Supplies                   65,279            59,618                                   9.5                        22.6                  23.5

    Service and
     software                  18,372            13,251                                  38.6                         6.4                   5.2
                               ------            ------                                                              ---                   ---

       Subtotal
        products              286,866           251,807                                  13.9                        99.5                  99.5

    Shipping and
     handling                   1,555             1,353                                  14.9                         0.5                   0.5

       Total net
        sales                $288,421          $253,160                                  13.9                       100.0                 100.0
                             ========          ========                                                            =====                 =====


                          Six Months Ended
                          ----------------

                              June 28,         June 29,          Percent         Percent of              Percent of

    Product Category                      2014              2013    Change      Net Sales - 2014        Net Sales - 2013
    ----------------                      ----              ----    ------      ----------------        ----------------

    Hardware                          $399,432          $345,630           15.6                    69.3                    70.6

    Supplies                           128,783           116,741           10.3                    22.3                    23.8

    Service and software                44,748            25,067           78.5                     7.8                     5.1
                                        ------            ------                                   ---                     ---

       Subtotal products               572,963           487,438           17.5                    99.4                    99.5

    Shipping and handling                3,726             2,659           40.1                     0.6                     0.5

       Total net sales                $576,689          $490,097           17.7                   100.0                   100.0
                                      ========          ========                                 =====                   =====


                                                                      SALES BY GEOGRAPHIC REGION


                                   Three Months Ended
                                   ------------------

                                        June 28,         June 29,                              Percent        Percent of            Percent of

    Geographic Region                               2014              2013                        Change      Net Sales 2014        Net Sales 2013
    -----------------                               ----              ----                        ------      --------------        --------------

    Europe, Middle East and Africa               $94,200           $80,913                               16.4                  32.7                  32.0

    Latin America                                 25,204            24,322                                3.6                   8.7                   9.6

    Asia-Pacific                                  40,334            36,973                                9.1                  14.0                  14.6
                                                  ------            ------                                                    ----                  ----

       Total International                       159,738           142,208                               12.3                  55.4                  56.2

    North America                                128,683           110,952                               16.0                  44.6                  43.8
                                                 -------           -------                                                    ----                  ----

       Total net sales                          $288,421          $253,160                               13.9                 100.0                 100.0
                                                ========          ========                                                   =====                 =====


                                   Six Months Ended
                                   ----------------

                                       June 28,         June 29,          Percent         Percent of              Percent of

    Geographic Region                              2014              2013    Change      Net Sales - 2014        Net Sales - 2013
    -----------------                              ----              ----    ------      ----------------        ----------------

    Europe, Middle East and Africa             $185,639          $158,586           17.1                    32.2                    32.4

    Latin America                                50,844            47,454            7.1                     8.8                     9.7

    Asia-Pacific                                 78,301            69,882           12.0                    13.6                    14.3
                                                 ------            ------                                  ----                    ----

       Total International                      314,784           275,922           14.1                    54.6                    56.4

    North America                               261,905           214,175           22.3                    45.4                    43.6
                                                -------           -------                                  ----                    ----

       Total net sales                         $576,689          $490,097           17.7                   100.0                   100.0
                                               ========          ========                                 =====                   =====




                                                            ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

                                                             RECONCILIATION OF GAAP TO NON-GAAP NET INCOME

                                                             (Amounts in thousands, except per-share data)

                                                                              (Unaudited)




                                   Three Months Ended                 Six Months Ended
                                   ------------------

                                      June 28, 2014                     June 29, 2013                       June 28,           June 29,
                                                                                                                      2014              2013
                                                                                                                                         ----


    Net income (GAAP)                               $27,557                            $30,566                         $69,163           $54,108


            Acquisition costs                       $20,364                               $618                         $25,291            $1,100

            Exit and
             restructuring
             costs                                      287                              1,101                             554             2,996

            Loss on interest
             rate swaps                               2,433                                  0                           2,433                 0

            Effect on income
             taxes                                  (7,376)                             (326)                        (5,144)            (763)
                                                     ------                               ----                          ------              ----

    Total adjustments                               $15,708                             $1,393                         $23,134            $3,333
                                                    -------                             ------                         -------            ------

    Net income (Non-
     GAAP)                                          $43,265                            $31,959                         $92,297           $57,441
                                                    =======                            =======                         =======           =======


    GAAP net income per share

           Basic                                      $0.54                              $0.60                           $1.37             $1.06
                                                      =====                              =====                           =====             =====

           Diluted                                    $0.54                              $0.60                           $1.35             $1.05
                                                      =====                              =====                           =====             =====

    Non-GAAP  net income per share

           Basic                                      $0.85                              $0.63                           $1.83             $1.13
                                                      =====                              =====                           =====             =====

           Diluted                                    $0.84                              $0.62                           $1.81             $1.12
                                                      =====                              =====                           =====             =====


    Basic weighted
     average shares
     outstanding                                     50,606                             50,900                          50,509            50,929

    Diluted weighted
     average and
     equivalent
     shares
     outstanding                                     51,278                             51,283                          51,129            51,310




                                                              ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

                                                                      GAAP to NON-GAAP RECONCILIATION

                                                               (Amounts in thousands, except per-share data)

                                                                                (Unaudited)




                                                   Three Months Ended                           Six Months Ended
                                                   ------------------                           ----------------

                                                      June 28, 2014                               June 29, 2013          June 28,          June 29,
                                                                                                                                  2014              2013
                                                                                                                                                     ----

    Operating Income to EBITDA and Adjusted EBITDA

    Operating income
     (GAAP)                                                         $33,065                                      $36,241           $86,473           $64,417

            Depreciation                                              6,427                                        6,178            12,757            11,687

            Amortization of
             intangible assets                                        2,667                                        1,863             5,339             3,726
                                                                      -----                                        -----             -----             -----

                    EBITDA (Non-GAAP)                               $42,159                                      $44,282          $104,569           $79,830
                                                                    -------                                      -------          --------           -------


            Acquisition costs                                        20,364                                          618            25,291             1,100

            Exit and restructuring
             costs                                                      287                                        1,101               554             2,996

            Stock-based
             compensation expense                                     4,144                                        4,358             7,110             6,504

            Loss on interest rate
             swaps                                                    2,433                                            0             2,433                 0
                                                                      -----                                          ---             -----               ---

                    Adjusted EBITDA (Non-
                     GAAP)                                          $69,387                                      $50,359          $139,957           $90,430
                                                                    =======                                      =======          ========           =======

SOURCE Zebra Technologies Corporation