This sounds like very positive news even tho their net is down, they have made significant progress...market seems to like it to...up 1/2.
rb
HDS Network Systems, Inc. Reports Operating Results
KING OF PRUSSIA, Pa., August 22, 1996 -- HDS Network Systems, Inc., a leading international supplier of network computers and
associated software designed for multivendor, multimedia networks and the Internet, today reported results for its fiscal year ended June 30,
1996.
The Company reported revenues of $20,819,444 for the year ended June 30, 1996, compared to $21,841,229 for the year ended June 30, 1995.
The Company is in a major transition as the first to deliver a new line of network computers which are cost-effective alternatives to personal
computers and are designed for network-centric environments and the Internet. Although the new line began shipping too late in the fiscal
year to contribute significant revenue, the Company believes that it provides significant opportunities for growth.
"We are pleased that we were able to remain solidly profitable in fiscal 1996 while investing significant resources to develop the world's first
line of network computers," stated Arthur R. Spector, Chairman, President and CEO of HDS Network Systems. "During this past year we
invested heavily in engineering, as we developed our new operating system for network computers - netOS - which includes technologies that
we licensed from leaders in the Internet field, including Javatm, from Sun Microsystems, and Internet browsing technology, from Spyglass.
HDS also significantly expanded its marketing and sales efforts in preparation for the launch of these important new products, increasing
expenditures on public relations and advertising and opening new sales offices in the US, the UK and Germany. In particular, our public
relations efforts are beginning to pay off, with increased awareness of HDS as a leader in the network computer field and positive reviews of
our new @workStation products. We are proud that we are the first company to deliver in this important new market, and we believe our new
line of network computers will provide strong growth opportunities for our Company."
The Company's gross margin for the year ended June 30, 1996 increased to 24.5% of revenues from 22.8% of revenues in the prior year, due to
the Company's ability to reduce the cost of components used in its products. For the year ended June 30, 1996, net income was $622,884, as
compared to $1,443,270 in fiscal 1995, reflecting significant increases in the Company's investments in both sales and marketing and research
and development related to the introduction of the network computer line. General and administrative expenses increased as well, reflecting an
increase in corporate staff and the additional expenses arising from being a public company. Earnings were $.13 per share for fiscal 1996 on
8,206,705 shares outstanding, compared to proforma earnings of $.39 on 3,747,633 shares in fiscal 1995.
"We are also excited about the recently announced formation of a new subsidiary for the purpose of acquiring companies in the network
computer services field including information technology staffing companies and client-server consulting companies," continued Spector.
"We believe that a network services company will strongly complement our network computer business, and we look forward to a significant
contribution to our growth from Jim Dixon, formerly CEO of the $1.4 billion computer reseller CompuCom Systems, who has joined our Board of
Directors and has been appointed President and CEO of this new subsidiary."
HDS Network Systems, Inc. is a leading international supplier of network computers which are cost effective solutions for the integration and
delivery of information and applications to the desktop. The Company's network computers are based on an open architecture, incorporating
industry standards to enable seamless access to multiple forms of information, including text, graphics, audio and video data, on any type of
network. (Telephone: 1-800-HDS-1551; fax: 610-275-5739; e-mail inquiries: invest@hds.com; Web site: hds.com)
HDS and @workStation are trademarks of HDS Network Systems, Inc. Javatm is a registered trademark of Sun Microsystems, Inc. Other
trademarks are the property of their respective owners. |
