RELM Wireless Reports Third Quarter and Year-To-Date Results

-Sales and Profits Increase Significantly From Prior Year Periods-


WEST MELBOURNE, Fla., Nov. 10  /PRNewswire-FirstCall/ -- RELM Wireless Corporation (NYSE Amex: RWC) today announced its financial and operating results for the quarter and nine months ended September 30, 2009.

For the quarter ended September 30, 2009, sales increased $2.5 million (43.2%) to approximately $8.3 million, compared with $5.8 million for the same quarter last year.  Pretax income for the quarter increased 265.0%, or $1.1 million, to $1.5 million compared with $0.4 million for the same quarter last year.  Net income for the third quarter 2009 approximated $0.9 million, or $0.07 per diluted share, compared with $0.3 million, or $0.02 per share, for the prior year's third quarter.

Gross profit margin for the third quarter 2009 was improved to 51.1% of sales, versus 50.7% of sales for the same quarter last year.  Selling, general and administrative expenses were $2.7 million (32.8% of sales) in the third quarter 2009, compared with $2.6 million (44.1% of sales) in the third quarter 2008.

The Company had approximately $16.2 million in working capital as of September 30, 2009.  Cash and trade receivables increased almost 70% ($5.1 million) to-date in 2009 to $12.3 million, compared with $7.2 million at the start of the year.  During the nine months ended September 30, 2009, the Company reduced net inventories by approximately $3.6 million (37.1%), and repaid in its entirety the $1.5 million balance that was outstanding at the start of the year on its revolving credit facility.

RELM President and Chief Executive Officer David Storey commented, "Following our record results for the second quarter, we are encouraged with the continued strength in sales and profits relative to the same periods last year.  We were particularly pleased with the sales of our P25 digital products and new KNG products, which comprised almost 60% of our total sales.  This is a positive indicator for the KNG line and its acceptance among new customers.  Success in aggressively pursuing more sales gains with KNG products is key to our strategy for profitable growth.  Meanwhile, we are being cautious in maintaining operating expenses at the reduced levels established late last year, as business conditions gradually improve."

For the nine months ended September 30, 2009, sales increased approximately $6.5 million (41.9%) to $22.1 million, compared with $15.6 million for the same period last year.  Pretax income for the nine months ended September 30, 2009 increased $4.9 million to approximately $2.9 million, compared with a pretax loss of $2.0 million for the same period last year.  Net income for the nine months ended September 30, 2009 totaled approximately $2.0 million, or $0.15 per diluted share, compared with a net loss of $1.3 million, or $0.10 per share, for the same period last year.

Gross profit margin for the nine months ended September 30, 2009 was 48.5% of sales, versus 48.2% of sales for the same period last year.  Selling, general and administrative expenses for the nine months ended September 30, 2009 declined $1.9 million (19.4%) to approximately $7.8 million (35.2% of sales), compared with $9.7 million (62.0% of sales) for the same period last year.

Conference Call and Webcast

The Company will host a conference call and webcast for investors at 9:00 a.m. Eastern Time, Thursday, November 12, 2009.  Shareholders and other interested parties may participate in the conference call by dialing 800-860-2442 (international/local participants dial 412-858-4600) and asking to be connected to the "RELM Wireless Corporation Conference Call" a few minutes before 9:00 a.m. Eastern Time on November 12, 2009.  The call will also be webcast at http://www.relm.com/.  Please allow extra time prior to the call to visit the site and download any necessary software to listen to the Internet webcast.  An online archive of the webcast will be available on the Company's website for 30 days following the call at http://www.relm.com/.

A replay of the conference call will be available one hour after the completion of the call until November 20, 2009, by dialing 877-344-7529 (international/local participants dial 412-317-0088) and entering the conference ID 435360.

About APCO Project 25 (P25)

APCO Project 25 (P25), which requires interoperability among compliant equipment regardless of the manufacturer, was established by the Association of Public-Safety Communications Officials and is approved by the U.S. Department of Homeland Security.  The shift toward interoperability gained momentum as a result of significant communications failures during events such as the Oklahoma City bombings, the 9/11 attacks and Hurricane Katrina.  RELM was one of the first manufacturers to develop P25-compliant technology.

About RELM Wireless Corporation

As an American Manufacturer for more than 60 years, RELM Wireless Corporation has produced highspecification twoway communications equipment of unsurpassed reliability and value for use by public safety professionals and government agencies, as well as radios for use in a wide range of commercial and industrial applications.  Advances include a broad new line of leading digital twoway radios compliant with APCO Project 25 specifications.  RELM's products are manufactured and distributed worldwide under BK Radio and RELM brand names. The Company maintains its headquarters in West Melbourne, Florida and can be contacted through its web site at http://www.relm.com/ or directly at 18008212900.  The Company's common stock trades on the NYSE Amex market under the symbol "RWC".

This press release contains certain forward-looking statements that are made pursuant to the "Safe Harbor" provisions of the Private Securities Litigation Reform Act Of 1995.  These forward-looking statements concern the Company's operations, economic performance and financial condition and are based largely on the Company's beliefs and expectations.  These statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  Such factors and risks include, among others, the following: risks relating to the current financial crisis and adverse economic conditions; reliance on contract manufacturers; heavy reliance on sales to the U.S. Government; federal, state and local budget deficits and spending limitations; limitations in available radio spectrum for use by land mobile radios; general economic and business conditions amid the financial crisis; changes in customer preferences; competition; changes in technology; changes in business strategy; the debt and inventory levels of the Company; quality of management, business abilities and judgment of the Company's personnel; and the availability, terms and deployment of capital.  Certain of these factors and risks, as well as other risks and uncertainties, are stated in more detail in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2008 and in the Company's subsequent filings with the SEC.  These forward-looking statements are made as of the date of this press release, and the Company assumes no obligation to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.

  (Financial Tables to Follow)


                          RELM WIRELESS CORPORATION
               Condensed Consolidated Statements of Operations
                  (In Thousands, Except Per Share Amounts)


                                Three Months Ended     Nine Months Ended
                                ------------------     -----------------
                                    (Unaudited)           (Unaudited)
                                    -----------           -----------
                               9/30/2009  9/30/2008  9/30/2009  9/30/2008
                               ---------  ---------  ---------  ---------

  Sales, net                      $8,292     $5,790    $22,141    $15,599

  Expenses:
  Cost of products                 4,058      2,852     11,398      8,077
  Selling, general and
   administrative expenses         2,718      2,553      7,802      9,676
                                   -----      -----      -----      -----
  Total expenses                   6,776      5,405     19,200     17,753

  Operating income (loss)          1,516        385      2,941     (2,154)

  Other income (expense):
  Interest (expense) income           (5)        29        (41)       134
  Other expense                       (7)        (2)        (4)        (9)
                                     ---        ---        ---        ---

  Pretax income (loss)             1,504        412      2,896     (2,029)

  Income tax (expense) benefit      (577)       (75)      (881)       749
                                    ----        ---       ----        ---

  Net income (loss)                 $927       $337     $2,015    $(1,280)
                                    ====       ====     ======    =======


  Income (loss) per share -
   basic                           $0.07      $0.03      $0.15     $(0.10)
                                   =====      =====      =====     ======
  Income (loss) per share -
   diluted                         $0.07      $0.02      $0.15     $(0.10)
                                   =====      =====      =====     ======

  Weighted average common
   shares outstanding, basic      13,411     13,405     13,411     13,400
  Weighted average common
   shares outstanding, diluted    13,726     13,528     13,520     13,400



                          RELM WIRELESS CORPORATION
                    Condensed Consolidated Balance Sheets
                (In Thousands, Except Share Data) (Unaudited)

                                                       Sept. 30,   Dec. 31,
                                                         2009        2008
                                                         ----        ----
  ASSETS
  ------
  Current assets:
    Cash & cash equivalents                             $8,068      $5,475
    Trade accounts receivable, net                       4,227       1,769
    Inventories, net                                     6,146       9,774
    Deferred tax assets, net                               707       1,562
    Prepaid expenses & other current assets                476         931
                                                           ---         ---
  Total current assets                                  19,624      19,511

  Property, plant and equipment, net                     1,400       1,386
  Deferred tax assets, net                               7,638       7,638
  Capitalized software, net                              2,672       1,732
  Other assets                                             377         355
                                                           ---         ---

  Total assets                                         $31,711     $30,622
                                                       =======     =======

  LIABILITIES AND STOCKHOLDERS' EQUITY
  ------------------------------------
  Current liabilities:
    Accounts payable                                    $1,748      $1,849
    Accrued compensation and related taxes               1,117         617
    Accrued warranty expense                               224         302
    Accrued other expenses and other current
     liabilities                                           320         110
                                                           ---         ---
  Total current liabilities                              3,409       2,878

  Long-term debt                                             -       1,500

  Commitments and contingencies

  Stockholders' equity:
    Preferred stock; $1.00 par value; 1,000,000
     authorized shares, none issued or outstanding.          -           -
    Common stock; $0.60 par value; 20,000,000
     authorized shares, 13,410,871 issued and
     outstanding shares at September 30, 2009 and
     December 31, 2008, respectively.                    8,046       8,046
    Additional paid-in capital                          24,063      24,020
    Accumulated deficit                                 (3,807)     (5,822)
                                                        ------      ------
  Total stockholders' equity                            28,302      26,244
                                                        ------      ------

  Total liabilities and stockholders' equity           $31,711     $30,622
                                                       =======     =======


DATASOURCE: RELM Wireless Corporation



CONTACT:  William Kelly, EVP & CFO, RELM Wireless Corporation,

[phone]; or Investor Relations: R Jerry Falkner, CFA, R J Falkner &

Company, Inc., [phone]



Web Site:  http://www.relm.com/ 

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