IDS has positive comments from the company this morning we shall see if it moves the stock.
HOUSTON, June 1 /PRNewswire/ -- Industrial Data Systems Corporation ("the Company") (Amex: IDS) today, in light of recent volatility in the trading of its stock, is issuing this press release. Since Wednesday, May 26, 1999, approximately 4,300,000 shares of the Company's Common Stock have traded at prices ranging from a high of $9.25 on Wednesday, May 26, 1999 to a low of $2.375 on Friday, May 28, 1999. The Company is not aware of any developments during this period of time that would account for this volatility and trading volume.
The Company would like to confirm that there have been no recent changes to its corporate management team or loss of contracts with key customers. In addition, the Company is not aware of any purchases or sales of its Common Stock by its officers or directors during the last two quarters of 1998 or in 1999. The Company believes it is appropriate to present the following current status of its business due to the recent volatility of its Common Stock.
Thus far in the second quarter of 1999, the Company has experienced equivalent or improved business performance in four of its five operating subsidiaries as compared to the previous quarter. These subsidiaries are Industrial Data Systems, Inc., IDS Engineering, Inc., Constant Power Manufacturing, Inc. and Thermal Corporation. As a result of this trend, the Company expects to report increased consolidated earnings from operations for the second quarter ending June 30, 1999 versus the first quarter ended March 31, 1999.
IDS Fabricated Systems, Inc., formerly known as MLC Enterprises, Inc. ("MLC"), was acquired in November 1998 as the Company's fifth subsidiary. MLC was acquired in exchange for 50,000 shares of the Company's Common Stock and has shown disappointing performance since the acquisition. The Company is currently in the process of determining the ongoing status of MLC and believes that the write-off of goodwill associated with this transaction is likely to be accelerated during the second quarter ending June 30, 1999.
The former principal of MLC has filed a lawsuit against the Company alleging breach of an employment contract in addition to other related claims. The Company does not believe that there is any merit to the claims of the plaintiff in this case and has and will continue to take steps to vigorously defend against such claims. In connection with this matter, the Company has filed a counterclaim seeking damages and rescission of the MLC transaction. The Company does not believe that this litigation is material to its ongoing business operations.
|
