Thanks Jean, Here's the financials...
I missed this release. I guess that they released after market close.
As for the share price, I really don't know how much lower it can go,
but I may not be willing to wait. I am really getting quite depressed
about this company. I also see that LEG has the dubious honour as
being listed as the TOP LOSER %-wise on the TSE last week. GREAT!
I suppose that one could say that this is probably the last (???)
"bad" press release and that sunnier days are ahead. I will seriously
have to re-evaluate my position in Legacy in the coming weeks (days).
If the price drops much lower I will be out because technically
speaking the chart set a new level @ $1.90 and if it breaks through
that level I really don't know where the floor will be. One slightly
good sign is that the chart did not bottom at the low, but closed
higher. There is a good chance that it will rebound next week. If not,
well lets just say I may not stick around to find out...
Good trading.
NEWS RELEASE TRANSMITTED BY CANADIAN CORPORATE NEWS
FOR: LEGACY STORAGE SYSTEMS INTERNATIONAL INC.
TSE SYMBOL: LEG
OCTOBER 30, 1996
LEGACY Storage Systems International Inc. Announces
Financial Results for the Quarter ended August 31, 1996
MARKHAM, ONTARIO--LEGACY Storage Systems International Inc.
reports financial results for the quarter ended August 31, 1996.
All results are in $US.
Revenue for the quarter was $18.8 million compared to $21.3
million in the previous quarter and up from $7.4 million in the
first quarter of fiscal 1996. The loss, before reorganization
costs, was $2.2 million down from $4.0 million in the fourth
quarter of fiscal 1996. Legacy recorded reorganization costs
totaling $7.1 million associated with the restructuring of the
Canadian business unit. This resulted in a net loss for the
quarter of $9.3 million ($0.11 per share). The restructuring is
the subject of a separate news release dated October 30, 1996.
"These results are obviously unsuitable" says David Killins
Chairman and CEO of Legacy, "Accordingly the Board has instructed
management to undertake a restructuring of the business and focus
its resources on its Longmont, Colorado subsidiary, Tecmar
Technologies, Inc." Killins noted that Tecmar today announced
that NCR Corp. signed an agreement and shipments have begun of
Tecmar's new WangDAT 3800.
For the quarter, revenue of $12.8 million was contributed by the
Tape Operations compared to $14.3 million in the fourth quarter of
fiscal 1996. Ernest H. Wassmann, President and CEO of Tecmar
Technologies, Inc. commented "The turnaround at Tecmar is a
process which will continue through the 1997 fiscal year. Our
success in the data storage markets will be founded on our proven
ability to develop proprietary technology, our distribution
capability and our demonstrated commitment to being an innovative
and reliable business partner for our customers and suppliers."
Storage One, Legacy's distribution arm, which purchases data
storage products for sale into world markets, generated $5.6
million in sales in the quarter vs $4.6 million in the fourth
quarter of fiscal 1996. Revenue from the Systems business, which
incorporates V1500. SmartARRAY and service units, was $0.4
million compared to $2.4 million in the fourth quarter of fiscal
1996.
Legacy Storage Systems International Inc. designs, develops and
manufactures tape storage technologies.
/T/
Consolidated Interim Balance Sheet - Unaudited
August 31, 1996, with comparative figures for 1995
(stated in thousands of United States dollars)
1996 1995
Assets
Current Assets:
Cash $ 2,446 $ 4,250
Accounts receivable 12,622 1,877
Inventories 8,044 5,221
Prepaid expenses and other 2,152 305
--------- ---------
25,264 11,653
Fixed assets 3,775 433
Goodwill and other intangibles - 3,006
--------- ---------
$ 29,039 $ 15,092
--------- ---------
Liabilities and Shareholders' Equity
Current Liabilities:
Bank indebtedness $ 4,703 $ -
Accounts payable and
accrued liabilities 12,338 2,647
Obligations under capital leases 215 71
--------- ---------
17,256 2,718
Shareholders' equity
Share capital 44,888 12,604
Deficit (33,105) (230)
--------- ---------
11,783 12,374
--------- ---------
$ 29,039 $ 15,092
--------- ---------
Consolidated Interim Statement of Earnings - Unaudited
Three months ended August 31, 1996,
with comparative figures for 1995
(stated in thousands of United States dollars,
except per share amounts)
1996 1995
Sales $ 18,767 $ 7,373
Cost of goods sold 16,120 6,814
--------- ---------
2,647 559
Expenses
General and administrative 1,955 346
Selling and marketing 1,730 286
Research and development 1,150 128
--------- ---------
4,835 760
--------- ---------
Loss before the following (2,188) (201)
Other income (expense)
Interest (24) 39
Amortization of goodwill - (26)
Reorganization costs (note 1) (7,137) -
--------- ---------
Net loss $ (9,349) $ (188)
--------- ---------
Net loss per common share $ (0.11) $ (0.00)
--------- ---------
Weighted average common shares
outstanding, in thousands 83,802 44,924
--------- ---------
Consolidated Interim Statement of Deficit - Unaudited
Three months ended August 31, 1996,
with comparative figures for 1995
(stated in thousands of United States dollars)
1996 1995
Deficit, beginning of period $ 23,756 $ 3,093
Net loss 9,349 188
Share issue costs - 42
Reduction of stated capital
in respect of common shares - (3,093)
--------- ---------
$ 33,105 $ 230
--------- ---------
Consolidated Interim Statement of Changes
in Financial Position - Unaudited
Three months ended August 31, 1996, with comparative
figures for 1995 (stated in thousands of
United States dollars)
1996 1995
Cash provided by (used in):
Operations:
Net loss $ (9,349) $ (188)
Items not involving cash:
Depreciation and amortization
of fixed assets 313 30
Amortization of goodwill -- 26
Reorganization costs 7,137 --
Changes in non-cash operating
working capital (3,102) (284)
--------- ---------
(5,001) (416)
Investments:
Purchase of fixed assets (213) (240)
Financing:
Issuance of common shares 61 338
Decrease in obligations under
capital leases (82) (8)
--------- ---------
(21) 330
--------- ---------
Decrease in cash (5,235) (326)
Cash, beginning of period 2,978 4,576
--------- ---------
Cash, end of period $ (2,257) $ 4,250
--------- ---------
Cash is defined as cash less bank indebtedness.
/T/
Notes to Consolidated Interim Financial Statement - Unaudited
August 31, 1996
1. Subsequent events:
Share consolidation and name change
-----------------------------------
On October 2, 1996, the shareholders approved a change in the name
of the Corporation from Legacy Storage Systems International Inc,
to Tecmar Technologies International Inc. (TSE: "TTT") Also on
that date, the shareholders approved the consolidation of the
issued and outstanding common shares and Class B Preferred shares
on a 10 for 1 basis. The Company expects to enact these changes
during the year ended May 31, 1997.
Reorganization costs -------------------
Subsequent to August 31, 1996, Legacy has decided to reorganize
the Canadian systems operation which principal business is the
manufacture and distribution of disk array subsystems, storage
servers and other data storage related products. As a result of
this decision, estimated reorganization costs have been reflected
in these financial statements, including the write-down of
inventory and fixed assets, the write-off of intangible assets and
the accrual of severance and facility costs.
2. Comparative figures:
With the acquisition of Tecmar Technologies, Inc. (formerly Rexon
Incorporated ("Rexon")) on March 4, 1996, these has been a
significant increase in the Company's activities in the United
States. These financial statements have been restated in U.S.
dollars using a translation method of convenience by which amounts
previously stated in Canadian dollars have been converted to U.S.
dollars using a rate of $.7342, without any other effects on
previous results stated in Canadian dollars. |
