EVERETT — Patrick Byrne arrived at Intermec Inc. this summer at a pivotal point.
It’s not a company in need of massive changes. He became the chief executive officer and president of a company that’s already been streamlined and restructured during the past three years by former Chief Executive Larry Brady.
“In a lot of ways, I’m showing up in a spot where the ground’s already been prepared,” Byrne said.
But that prepared ground isn’t all lush and green. In the past year, Intermec has seen sales of its mobile computers, bar code scanners and other inventory tracking technology noticeably slow. After peaking above $30 a share late last year, the company’s stock is down.
The face of Intermec’s competition also is changing, thanks to consolidation in the industry.
Byrne seems determined, not daunted, by those circumstances. The 46-year-old comes with a good reputation from his last job as senior president of Agilent Technologies’ test and measurement group, a $3.5 billion business with 12,000 employees.
“Patrick brings extensive experience in managing technology-based businesses and developing global markets,” Allen Lauer, who was named chairman of Intermec’s board of directors the same day Byrne took over, said in a written statement. “His background and knowledge are a perfect fit for Intermec.”
Raised in California’s Silicon Valley, Byrne joined Hewlett-Packard after graduating from the University of California at Berkeley, with an electrical engineering degree. He worked on integrated circuit chips for computers and printers at HP while working on a graduate degree at Stanford, then moved to the company’s test and measurement business in Colorado.
After Agilent spun off from Hewlett-Packard, Byrne moved back to Northern California and led Agilent’s wireless business division before taking over the test and measurement business for the last two years.
Byrne admits he didn’t know Intermec that well while he was at Agilent. But when he looked for places where he could become chief executive, Intermec as a company stood out, he said.
“I’m more excited now than the day I started,” he added.
Since that day in July, changes have ensued. Most notably, Steve Winter, who served as Intermec’s president and chief operating officer under Brady, has left. Analysts and investors also have expressed optimism about Byrne’s potential.
Founded locally in 1966, Intermec grew over the years with the help of numerous acquisitions into a company of thousands with operations around the world. Under the corporate parent of Unova Inc., Intermec just a few years ago was part of a company that also included a heavy machinery division.
Beginning in the early part of this decade, Brady first consolidated Unova’s industrial operations in the Midwest and Eastern states and then sold them all off by the end of 2005.
What was left was Intermec’s technology-focused operations. Brady moved the corporate headquarters from California to Everett and renamed the parent company Intermec Inc. to reflect the new focus.
During this time, the company reached $875 million in sales during 2005. Brady talked about reaching $1 billion in revenue at the start of 2006.
But halfway through last year, sales began falling. The trend has continued, with revenue for the second quarter dropping from $231 million last year to $210 million. Earnings for the quarter totaled $6.6 million, down from $10.4 million.
The bright spot: Revenue improved 17 percent from this year’s first quarter to the second quarter.
Byrne said accelerating product development and focusing on the key industries into which Intermec already sells well are among the things the company can do better. Intermec’s technology is used widely by companies in the transportation, manufacturing and distribution industries, as well as by government agencies. Its bar code scanners and other devices also are used in some retail stores as well.
“(The company’s) done a great job of taking care of its key customers,” he said, adding that holding onto and expanding that base is critical for growth. “I’m very confident Intermec has a very bright future in these target industries.”
Intermec also has a strong collection of patents related to radio-frequency identification, a technology that slowly is finding new uses. Actual sales of RFID products are still miniscule, but Byrne said Intermec is not ignoring the future potential there. “The key thing at this point is making sure we have the intellectual property patent of it and the early customer contacts. We have to make sure we have that before we can build it into a significant business,” he said.
“I think Intermec is very well positioned. It’s important to get the early wins, and we’re getting these early wins,” Byrne added.
Kevin Starke, an analyst with Connecticut-based research firm Weeden &Co., said Intermec’s languishing stock price has dimmed interest among some investors. He said he’d like to see Byrne direct the company to better control its costs and work on marketing its products more effectively.
Starke noted that Byrne’s past experience with Agilent, a company with strong involvement in the telecommunications industry, seems in sync with the direction that Intermec’s competitors are going. Last week, rival Zebra Technologies named as its new chief executive an official at Spirent Communications, a British phone maker. Intermec’s biggest competitor, Symbol Technologies, was bought out early this year by Motorola.
Byrne said he and his family, which includes three teenagers, are settling into a new house in Mukilteo. Meanwhile, Intermec’s new models have hit the marketplace after a slower-than-anticipated rollout process that helped cut into sales earlier this year. The new models include the CN3, touted as the world’s smallest handheld computer designed for rugged use.
With the transition to the company’s latest product line now mostly completed, Byrne said it’s time to shore up sales both here and abroad.
“It’s all about focus and execution,” he said. “There’s plenty of market opportunity.”
Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.
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