Cognitronics Reports Fourth Quarter Income Equal to 30 Cents Vs 28 Cents
DANBURY, Conn., March 5 /PRNewswire/ -- Cognitronics Corporation (Amex: CGN - news) today reported income for the fourth quarter of 1998 equal to $.30 per diluted share, up from $.28 per diluted share, excluding a provision for the settlement of class-action litigation, a year ago.
For the quarter ended December 31, 1998, net income was $1,190,000 versus $563,000, or $.14 per diluted share, for the same quarter in 1997. The 1997 quarter includes a one-time pre-tax charge of $915,000 (net of tax - $572,000 or $.14 per diluted share) in connection with the settlement of class-action litigation.
Sales for the fourth quarter were $7.3 million in 1998, up from $7.1 million in 1997.
The company said that the increase in fourth quarter 1998 sales from the comparable 1997 quarter was attributable to a $2 million volume sale of McIAS(TM) 1623/IP voice information systems installed in the Mexican telecommunications network, offset by lower domestic sales to OEM customers and lower sales of distributorship products in the United Kingdom. However, based on sales order bookings to date in the 1999 first quarter, the company anticipates that domestic sales to OEM customers will return to a normal level in the first quarter 1999.
For the year ended December 31, 1998, the company reported record net income of $4.7 million, or $1.17 per diluted share, compared to $3.7 million, or $.93 per diluted share in 1997. The 1997 year includes pre-tax charges of $956,000 (net of tax - $598,000 or $.15 per diluted share) in connection with the settlement of litigation. Sales for year were $28.9 million in 1998 versus $29.5 million in 1997.
''The year 1998 continued with a strong performance in both the company's domestic operations and its UK distributorship operations,'' said Brian J. Kelley, president and chief executive officer of Cognitronics. In addition to record earnings, the company's financial condition was substantially improved. Working capital increased 40% to $18 million, including $11 million in cash and marketable securities.
''New product development continues and investment in research and development is expected to continue to increase in 1999. We believe that the telecommunications market will require an enhanced intelligent peripheral for use in the Advanced Intelligent Network (AIN). To meet this need, we have substantially completed development of a new, all VME-based platform utilizing the Solaris® operating system and our new multi-resource line interface technology, and recently installed a pre-production unit in the laboratory of a major nationwide telecommunications provider for testing. This new platform, together with new software, provides greater capacity and advance functionality, including ISDN Primary Rate interface capability. We believe that this new platform will offer to our customers reliable, cost effective solutions for their voice processing requirements in the Advanced Intelligent Network.''
Statements contained herein which are not historical facts are forward-looking statements. The forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve a number of risks and uncertainties including, but not limited to, variability of sales volume quarter to quarter, product demand, market acceptance, litigation, risk of dependence on significant customers, third party suppliers and intellectual property rights, risks in product and technology development and other risk factors detailed in the company's Securities and Exchange Commission filings. Cognitronics is a leading manufacturer and supplier of voice processing equipment, including telephone network and call management products, to telephone operating companies, original equipment manufacturers. |
