JMAR Industries Reports Record Revenues and Earnings for 1997; 1997
Net Income Increased 130 Percent to 11 Cents Per Share
SAN DIEGO (March 5) BUSINESS WIRE -March 5, 1998--JMAR Industries Inc.
(NASDAQ NM:JMAR) Thursday announced all-time record annual earnings and
revenues for the year ended Dec. 31, 1997.
Net income for 1997 increased more than 130 percent to $1,795,285, or
11 cents per share, compared with $779,569, or 5 cents per share for
1996. Operating income for the year improved more than 200 percent to
$1,526,942 compared with $503,967 from a year ago.
Included in 1997 operating income is a non-recurring gain of $589,969
primarily related to the company's reorganization of its Cal ASIC
semiconductor division. Revenues for 1997 increased 31 percent to $21,
461,627 from $16,331,090 in 1996.
Net income for the fourth quarter of 1997, including the non-recurring
items, improved to a new quarterly high of $1,108,753, or 6 cents per
share. This compares with net income of $1,031,211, or 6 cents per
share for the fourth quarter of last year which included a
non-recurring gain of $400,000 that resulted from a transaction
unrelated to the company's operations.
Revenues for the fourth quarter of 1997 were $5,063,909 compared with
$5,262,222 in the final quarter of 1996.
JMAR attributed a significant portion of its annual revenue gain to
heightened and growing demand for its core disk drive manufacturing
equipment. Management believes this growth to be the result of
on-going expansion of the global market for high-performance hard disk
drives, particularly those incorporating advanced magneto-resistive
(MR) recording head technology.
Demand for the company's Mirage family of tabletop test and measurement
systems increased as the microelectronics industry, including makers of
ion beam manufacturing equipment, discovered several new ways to
utilize JMAR's products to improve their manufacturing yields.
In addition, the revenues generated by the company's DARPA-funded X-ray
lithography source development program increased approximately 40
percent over the prior year. JMAR Chairman and Chief Executive
Officer, John S. Martinez commented, "1997 was JMAR's third consecutive
year of record profits and revenues.
"We believe this trend demonstrates the viability of our strategy to
profitably expand our Core Product offerings into larger, rapidly
growing markets while simultaneously continuing to move new high-impact
emerging products closer to the commercial marketplace.
"One of these emerging products, our Britelight(tm) all-solid-state
laser technology is now transitioning into product engineering programs
for entry into the commercial marketplace later this year," Martinez
said.
"Our X-ray lithography program, which utilizes these same Britelight
laser light sources, also advanced during 1997," Martinez continued.
"At present, we are continuing to scale-up our system to higher power
and efficiency levels with a target of attaining those commensurate
with commercially viable semiconductor manufacturing throughput.
"Once we achieve this, we look to reach the next milestone of the
program, which is the integration of our X-ray source with an X-ray
stepper to create a functional X-ray lithography workstation that can
be used by semiconductor manufacturers to develop their advanced
manufacturing processes. Subsequent milestones include further scaling
to higher production rates in future years.
At present, the pace at which this program advances will be determined
by the continued success of our current scale-up activities and the
rate at which contract funding is received from the U.S. Government's
Defense Advanced Research Projects Agency.
"In addition to the success of our Core products and advances in our
research and development programs, we were also pleased with the
resurgence of our California ASIC semiconductor manufacturing division
following its reorganization toward the end of 1997," Martinez noted.
"Prior to that reorganization, we conducted an extensive, in-depth
evaluation of Cal ASIC's assets, capabilities, and market orientation
which revealed a wealth of chip design and foundry management expertise
that was not being adequately utilized under the original business
plan.
"We also determined that constraints in internal production capacity
unnecessarily restricted the operation's profitability. That formed
the basis for the warranty claim settlement which we reached with the
former owners of Cal ASIC. Since that settlement was in excess of
JMAR's original Cal ASIC purchase price there was no negative impact on
JMAR's bottom line from Cal ASIC in 1997.
"Under the direction of its new President, Mr. Marv Sepe, Cal ASIC
management negotiated a series of foundry arrangements with other
semiconductor manufacturers that gave it the means for production
without the volume constraints posed by reliance on its existing
fabrication facilities.
"Today, in its new role as a 'fab-less' supplier of custom
semiconductors and a provider of foundry management services for other
organizations, Cal ASIC has the ability to address a much broader
segment of the semiconductor market and offer a far wider range of
high-performance chips without those volume constraints.
"Based on initial responses from the marketplace, we are encouraged
that this will enable Cal ASIC to mirror the strategic and financial
success already achieved by our other divisions," Martinez said.
Martinez added, "Although JMAR's overall product line priorities remain
unchanged, we are optimistic about the future of Cal ASIC and believe
that it will contribute positively to JMAR's performance starting in
1998."
JMAR Industries Inc. develops, manufactures and markets precision
measurement, process control and manufacturing systems and laser and
semiconductor products for the microelectronics and medical industries
and is a leading developer of advanced lithography sources for
production of higher performance semiconductors.
Pursuant to the Private Securities Litigation Reform Act of 1995: "The
statements regarding JMAR's future sales or profit growth, competitive
position or projects, or processes currently under development and the
ability of the company to successfully apply or otherwise transfer
those projects or processes to alternate applications are
forward-looking statements based on current expectations that involve
risks and uncertainties that could cause actual results to differ
materially from those set forth in the forward-looking statements,
including delays in shipment or cancellation of orders, concentration
of sales to certain markets and customers, timing of future orders,
customer reorganizations, fluctuations in demand, delays in
development, introduction and acceptance of new products, changing
business and economic conditions in various geographic regions, natural
events such as earthquakes, flood and fire and the other risks detailed
from time-to-time in the company's reports which are filed with the
Securities and Exchange Commission."
JMAR INDUSTRIES INC.
FINANCIAL DATA
CONSOLIDATED STATEMENTS OF INCOME
Year Ended Quarter Ended
Dec. 31 Dec. 31
1997 1996 1997 1996
Net Sales $21,461,627 $16,331,090 $5,063,909 $5,262,222
Gross Profit 8,830,316 6,692,136 2,284,810 2,412,061
Income From
Operations 1,526,942 503,967 938,531 500,414
Net Income 1,795,285 779,569 1,108,753 1,031,211
Net Income Per
Share - Basic .11 .05 .06 .06
Net Income Per Share -
Diluted .10 .05 .06 .06
SELECTED BALANCE SHEET DATA
Year Ended Dec. 31
Item 1997 1996
Assets 17,268,878 15,395,518
Cash 3,644,117 2,629,286
Working Capital 9,634,526 5,743,747
Current Ratio 3.49 2.07
Long-Term Debt 907,235 667,310
Shareholder Equity 12,488,212 9,368,905
Net Tangible Equity 12,100,147 8,257,015
-0- AJE/la* JP/la
CONTACT: JMAR Industries Inc., San Diego
Dennis E. Valentine, 619/535-1706
jmar.com
or
Silverman Heller Associates
Eugene Heller/Glenn Schoenfeld, 310/208-2550
KEYWORD: CALIFORNIA
INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS COMED MEDICINE EARNINGS
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