Ausdauer, it's all in the 10Q... just read further on:
RESULTS OF OPERATIONS
For the first three months of fiscal 2000, the Company reported revenues of $37,301, a 62% decrease from revenues of $98,189 for the first three months of fiscal 1999. Three customers accounted for 95% of fiscal 1999's first three months of revenues and three customers accounted for total revenue in the first three months of fiscal 2000. The loss of a customer could have a material adverse impact on the Company.
Revenue for the first three months of fiscal 2000 included product revenue of $15,062 from Lanier for the initial shipment of their product late in the quarter. These shipments are against a $3 million initial production order.
Services for the first fiscal 2000 quarter were $22,239 compared to $75,693 for the prior year's first quarter. The decrease is consistent with the reduction in Lanier activity. First quarter fiscal 2000 service revenue included $7,207 and $15,000 recognized under the Intel and Lucent development agreements, respectively.
For the three months ended June 30, 1999, the Company reported a gross profit of $7,723 as compared to a gross loss of $21,581 for the first three months of fiscal 1999. Cost of sales consisted of $14,871 of product costs and $14,707 of contract services consisting mostly of research and development labor being funded in part by the Lucent and Intel development agreements. The Company is substantially completed on the Lanier development contract. Although the Company does not anticipate any significant future contract losses, there can be no assurance the Company can attain positive gross margins in the future or with future customers.
Total operating expenses (consisting of research and related expenditures and selling and administrative expenses) for the three months ended June 30, 1999, were $381,340, as compared to $366,606 for the three months ended June 30, 1998.
Selling and administrative costs aggregated $166,618 in the first three months of fiscal 2000 compared to $220,758 in the prior period. The $54,140 decrease in selling and administrative costs resulted primarily from the inclusion of a $55,000 non-recurring equity transaction fee in the prior years first quarter.
Research and related expenditures for the three months ended June 30, 1999 were $214,722, as compared to $145,848, for the three months ended June 30, 1998. An aggregate of $14,707 of development costs were incurred for contract development work during the three months ended June 30, 1999 and are included in cost of revenues. Research and development costs are subject to significant quarterly variations depending on the use of outside services, the assignment of engineers to development projects and the availability of financial resources. The increase can be attributed to expanded engineering activities associated with the development of new technology.
The Company reported an operating loss of $373,617 for the three months ended June 30, 1999, which was comparable to the operating loss of $388,187 for the three months ended June 30, 1998. Management believes, but there can be no assurance, that investments in OEM developments with supply or royalty provisions will provide positive margins in future periods. The timing and amount of product sales and the recognition of contract service revenues impact the Company's operating losses. Accordingly, there is substantial uncertainty about future operating results and the results for the first three months are not necessarily indicative of operating results for future periods or the fiscal year.
The Company's cash interest expense for the three months ended June 30, 1999 was $21,074, a decrease from the $28,394 for the prior period resulting from reduced interest bearing debt outstanding during fiscal 2000.
The Company reported a loss for the first three months of the current fiscal year of $422,145 compared to a loss of $464,538 for the prior year's first three months.
The loss available to common stockholders for the three months ended June 30, 1999 of $668,117 includes $390,000 of imputed dividends on the issuance of warrants with the Series B stock, $5,972 of dividends and $150,000 related to the imputed discount at issuance of the Series B stock. |
