Aura Releases Message to Shareholders
EL SEGUNDO, Calif.--(BUSINESS WIRE)--Oct. 18, 2002--Aura Systems, Inc. (OTCBB:AURA) has made available a message to the shareholders from Neal Meehan, Chairman and CEO, regarding the second quarter results of Fiscal 2003.
Dear Shareholders:
I would like to begin by thanking our employees, customers, suppliers,
and you, our shareholders, for all of the support I have received
since my appointment as Aura Systems' Chairman of the Board and Chief
Executive Officer. I look forward to working with all of you so that
together we can make Aura a growing, profitable and successful
company. We have an outstanding product, dedicated employees,
committed strategic suppliers and a supportive customer base.
The downward quarterly revenue trend of Fiscal 2002 has been reversed.
We are now headed in a positive direction. Net revenues for the first
and second quarters of Fiscal 2003 were approximately $200,000 and
$300,000, respectively. Sales to our major distributors were low as
they continue to reduce their inventory levels. We now believe that we
will see reordering from them in the upcoming quarters. We also
anticipate a sales increase in the remaining quarters of Fiscal 2003
and into Fiscal 2004.
While growing the revenues, the Aura team is focused on reducing the
cost structure of the Company so that we can more rapidly attain
profitability and a positive cash flow. Operating expenses in the
second quarter of Fiscal 2003 continue to be greatly reduced as
compared to the same period in Fiscal 2002 as a result of cost control
actions taken this year and balance sheet changes which occurred last
year. Total operating expenses were reduced 48% to $3.0 million in the
second quarter compared to the prior year second quarter after
eliminating the $2.3 million charge we recognized for the impairment
on the real estate. The operating expenses in the upcoming quarters
will reflect a base level of spending below the first and second
quarters of this year. Due to Aura's focus on growing its revenues,
there will be some increased spending for sales and marketing
activities. As a result of the reduced debt, net interest charges
continued to decrease as compared to the same period in the prior
year.
The Aura team has made significant strides in implementing key
strategies to increase revenues. Aura has appointed a new Vice
President of Sales and Marketing. In addition, the Company has
expanded its sales and marketing team through the hiring of three new
Regional Sales Managers, as well as a Director of Marketing. The
Company continues to forge strategic alliances and focus its resources
towards efforts that will result in increased future revenues. This
past quarter we announced the following:
-- Stewart & Stevenson will offer the AuraGen(R) VIPER on their
Family of Medium Tactical Vehicles (FMTV). Both companies will
jointly market the mobile power option to the military. This
teaming approach is important because the AuraGen(R) could become
the mobile power system of choice over the five year award period.
-- The AUSA (Association of the United States Army) annual meeting
to be held in Washington, D.C. October 21-23 will feature three
premiere defense companies using the AuraGen(R) as its mobile power
system of choice. This exposure will allow the AuraGen(R) to be
directly marketed by General Motors, Raytheon and Stewart &
Stevenson to the Army's civilian and military leadership. Both
Raytheon and Stewart & Stevenson will have VIPER equipped
demonstration vehicles at the show.
-- To further its efforts, the Company has continued to utilize the
expert services of Burdeshaw Associates, Ltd. These activities
continue to legitimize the VIPER mobile power solution for the
military.
-- We have met with key congressional leadership resulting in
increased exposure of the capabilities that the VIPER can lend to
the U.S. military in an effort to accelerate deployment of the
VIPER in support of Enduring Freedom Operations.
-- Ford's Modified Vehicle Engineering group approved the
AuraGen(R)for use on its Super Duty F-Series trucks. This approval
now allows any Ford commercial truck dealer worldwide to order the
AuraGen(R) installed through the Louisville Truck Equipment
facility or the Fort Wayne Fleet Equipment Company.
-- Luverne Fire Apparatus, a wholly owned subsidiary of Spartan
Motors, began offering the AuraGen(R) mobile power-generating
system as an option on all its fire trucks and rescue vehicles.
Finally, just as I welcome suggestions and new innovations from my
staff and employees, I welcome your input as well. Thanks again to
you, our shareholders, employees, customers and suppliers.
Very truly yours,
Neal F. Meehan
Chairman and Chief Executive Officer |
