NHC COMMUNICATIONS INC. ANNOUNCES THIRD QUARTER AND NINE-MONTHS RESULTS OF FISCAL
1997
MONTREAL, Canada, June 25 /CNW/ - NHC Communications Inc. (NHC) announced
today financial results for the third quarter and nine-month period ended May
2, 1997. For the third quarter, revenues were $4,802,000, an increase of 40.6%
from the same period of the previous year. The Company reported a net loss of
$435,000 compared to a break-even position in the 1996 quarter.
For the first nine months, revenues were $13,720,000, an increase of
35.5% from the same period of the previous year. The higher revenues in both
the third quarter and first nine months of the current year are mainly
attributable to an acquisition recorded at the end of fiscal year 1996.
Revenues from NHC's largest line of business, IBM Connectivity products, have
been stable.
``The third quarter loss is almost entirely due to the acceleration of
sales and marketing initiatives as well as higher research and development
expenditures, both of which are directly related to our high-growth Switching
and Fiber Optics lines of business'', stated Sylvain Abitbol, President and
Chief Executive officer. ``These increased expenses are part of our business
plan and we are proceeding despite the short-term impact on results because we
expect to see positive benefits in the near term.''
In the Switching line of business, NHC has successfully validated the
benefits of its technology through several installations with early reference
users, including BBN, one of the leading Internet Service Providers in the
United States. Several other well-known corporate users have also validated
NHC Switching products, including financial institutions, large manufacturers
and major telecommunications companies. ``In the process of proving our
technology in the marketplace, we have determined that the most effective way
to achieve the sales potential of our Switching solutions is to integrate them
with complementary products marketed by Original Equipment Manufacturers'',
explained Mr. Abitbol. ``As a direct result of our intensified sales and
marketing efforts, NHC is presently negotiating with several major OEMs who
have realized the benefits that their clients are obtaining through the
integration of out solutions with theirs. Such alliances are expected to
create a significant new sales channel for the Switching line of business and
result in new orders fairly quickly. This strategy has proven successful with
Network General which has decided to market our products after seeing the
positive reaction of their clients to NHC solutions.''
NHC is also engaged in increased sales and marketing activities in the
Fiber Optics line of business to capitalize on the fact that its products have
now been tested and validated. Among the key early adopters is Ameritech, a
leading RBOC. Additional research and development expenditures are being
incurred to adapt the products to specific customer requirements. ``The key
development in the third quarter is that two important US telecommunications
companies are now considering adopting our fiber optic technology'', said Mr.
Abitbol. Fiber optics in local and metropolitan area networks is a high-growth
sector, spurred by the worldwide trend in the deregulation of
telecommunications.
NHC is forecasting concrete results from the current sales, marketing and
R&D efforts within the next few months.
Concluded Mr. Abitbol: ``We are very encouraged by the interest in our
emerging lines of business because they represent the future of NHC. Industry
observers are unanimous in extolling the virtues of our technology,
particularly in the Switching line of business where we have a lead over our
competitors. We have stepped up our sales and marketing efforts, supported by
focused R&D work, to capitalize on our technological lead and on the clear
satisfaction of our clients.
NHC Communications Inc. (TSE symbol ``NHC'') is a leading developer of
switching products for the delivery of high-speed mixed-media networks.
Seventy-five per cent of NHC products are exported to 26 countries worldwide.
A conference call will be held at 11:00 a.m. time on June 26, 1997. To
participate, please call 1-800-898-3989. If you are unable to attend, the
post-view feature will be available for 48 hours following the conference at
1-800-408-3053, and dial password number 122413.
NHC Communications Inc.
Summary of Unaudited Consolidated Statements of Income
for the three-month period ended May 2, 1997
(in thousands of Canadian dollars, except per share amounts)
Third Quarter 1997 Third Quarter 1996
-------------------------------------------------------------------------
Revenue $4,802 $3,415
Gross profit $2,109 $1,642
Operating (loss) income $(489) $146
Net (loss) income $(435) $84
Net (loss) income per share $(0.04) $0.01
Shares used in the calculation of
the basic net (loss) income per
share 12,454,200 10,872,400
(anti-dilutive for 1996 and 1997)
NHC Communications Inc.
Summary of Unaudited Consolidated Statements of Income
for the nine-month period ended May 2, 1997
(in thousands of Canadian dollars, except per share amounts)
Nine Months 1997 Nine Months 1996
-------------------------------------------------------------------------
Revenue $13,720 $10,124
Gross profit $6,086 $4,528
Operating (loss) income $(458) $37
Net (loss) income (x) $(786) $915
Net (loss) income per share (x) $(0.06) $0.09
Shares used in the calculation
of the basic net (loss) income
per share
(1996: fully diluted net income
per share) 12,454,200 10,872,400
(x) The net loss of fiscal 1997 includes restructuring costs related to
NHC's French subsidiary of $146,900 or $0.01 basic net loss per share.
1996 net income includes after tax interest income from the long-term
balance receivable from the Co-Owners on the sale of the WireMan software of
$870,980 or $0.08 fully diluted net income per share (1997: net loss of
$42,800 or $0.00 basic net income per share).
NHC may be contacted through its web site: www.nhc.com
-30-
For further information: Sylvain Abitbol, President, C.E.O., NHC Communications Inc., 1-800-361-1965, Fax : (514) 735-8057,
Internet: pr(at)nhc.com, Web Site: www.nhc.com, or Sylvain Brossard, CA, V.P. Finance and Corporate Controller or Celeste S.
Poirier, NHC Communications Inc., 1-800-361-1965, Fax : (514) 735-8057, Internet : s.brossard(at)nhc.com |
