Allegro New Media, Inc. Reports 466% Increase in Third Quarter 1996 Net Sales Allegro New Media, Inc. Reports 466% Increase in Third Quarter 1996 Net Sales November 8, 1996, 12:45 PM EST
FAIRFIELD, N.J., Nov. 8 /PRNewswire/ -- Allegro New Media, Inc. (Nasdaq: ANMI) today reported a 466% increase in third quarter and a 180% increase in nine month net sales for the periods ended September 30, 1996.
Third quarter net sales increased 466% to $1,687,889 in 1996 from $298,342 in the 1995 nine months. This increase reflects two months of sales provided by Allegro's Serif Inc. and Serif (Europe) Limited subsidiaries, both of which were acquired on July 31, 1996, additional product offerings and greater retail distribution.
The third quarter net loss increased to $6,629,322, equivalent to ($1.80) per share, compared to a net loss of $295,539 or ($.25) per share in the third quarter a year ago. The increase was partially due to a $3,886,000 charge for in-process research and development related to the Serif acquisitions, a $2,135,000 compensation expense related to the release of shares of common stock held in escrow and the inclusion of two months of Serif operating expenses. The weighted average number of common shares outstanding was 3,680,435 compared with 1,198,994 at September 30, 1995.
For the recent three-month period, the cost of goods sold declined as a percentage of net sales because of higher sales volume, changes in product mix and lower unit cost. Selling, general and administrative expenses increased significantly, reflecting the inclusion of Serif operating expenses, increased direct mail advertising expenses, contractual employment wage agreements and the compensation expense resulting from the September 1996 release of escrow shares. Product development costs increased as Allegro produced four new Serif products.
"Allegro is successfully implementing our plan to build an infrastructure to support higher sales, additional product offerings, multiple-format distributions and an international presence. The integration of Serif and the pending acquisition and anticipated integration of Software Publishing Corporation are each milestones in establishing Allegro as a leading developer and marketer of visual communication software for the business markets," said Barry A. Cinnamon, Chairman and Chief Executive Officer of Allegro.
For the recent nine months, the company reported net sales increased to $2,554,337 from $913,041 in the comparable 1995 period. The 1996 year-to-date period reflects two months of sales from its Serif subsidiaries as well as a wider variety of products and increased sales to certain larger customers. Excluding the Serif contributions, Allegro's sales results increased 35% from the 1995 period.
The nine month net loss increased to $8,148,482 from $926,542, equivalent to a net loss per share of $2.44 compared to a net loss of $.72 per share in the 1995 nine month period. The losses were partially due to the above- referenced Serif in-process research and development expense, escrow stock compensation expenses and the inclusion of two months of Serif operating expenses.
The weighted average number of common shares outstanding was 3,331,920 for the recent nine months and 1,498,133 in the 1995 nine month period.
Except for historical information contained herein, the matters set forth in this news release are forward-looking statements that involve certain risks and uncertainties that could cause actual results to differ from those in the forward-looking statements. Potential risks and uncertainties include such factors as the level of business and consumer spending for computer software, the amount of sales of the company's products, the competitive environment within the computer software industry, the ability of the company to integrate the Serif operations and to culminate the pending Software Publishing Corporation acquisition and integrate its operations, the level and costs incurred in connection with the company's product development efforts and the financial strength of the retail industry. Investors are also directed to consider other risks and uncertainties discussed in documents filed by the company with the Securities and Exchange Commission.
NOTE: Allegro New Media and Serif publish interactive software applications that automate traditional business tasks. Their "Business Tools for the Inter ... Active" can be found at retail outlets throughout North America and Europe and may be ordered directly by calling 888-ALLEGRO (255-3476) or through their web site www.BusinessPlus.com.
ALLEGRO NEW MEDIA, INC.
Balance Sheet Data
September 30, December 31,
1996 1995
ASSETS (Unaudited) (Audited)
Current assets:
Cash $990,516 $ 2,928,272
Accounts receivable, net 1,347,991 342,425
Inventories 421,870 225,013
Other current assets 226,039 103,380
Total current assets 2,986,416 3,599,090
Equipment, furniture and leasehold
improvements 145,737 53,150
Goodwill and other intangibles 1,376,065 --
Royalty advances and other assets 276,239 206,366
Total $ 4,784,457 $ 3,858,606
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $1,164,711 $410,818
Accrued liabilities 1,470,670 309,924
Total current liabilities 2,635,381 720,742
Stockholders' equity: $2,090,537 $3,137,864
ALLEGRO NEW MEDIA, INC.
Condensed Statements Of Operations
(Unaudited)
Three Months Ended Sept. 30, Nine Months Ended Sept. 30,
1996 1995 1996 1995
Net sales $1,687,889 $ 298,342 $2,554,937 $ 913,041
Gross profit 1,300,544 208,101 1,825,424 483,626
Net loss $<6,629,322> $<211,717> $<8,146,482> $<826,542>
Net loss
attributable to
common
stockholders $<6,629,322> $<295,539> $<8,146,482> $<1,078,008>
Loss per common share:
Net loss per
common share $ <1.80> $<.25> $<2.44> $<.72>
Weighted average
number of
common shares
outstanding 3,680,435 1,198,994 3,331,920 1,498,133 SOURCE Allegro New Media, Inc.
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