No sleep for me :)
Ancor Reports Second Quarter Results
MINNEAPOLIS, July 22 /PRNewswire/ -- Ancor Communications, Inc.
(Nasdaq: ANCR) today reported a net loss of $1,646,000, or $.07 per diluted
share, on revenues of $3,599,000 for the second quarter ended June 30, 1998.
In the comparable 1998 period, the company reported a net loss of $7,301,000
or $.63 per diluted share, on revenues of $137,000. Financial results for the
company's 1998 second quarter included a charge of $4,432,000 for addition to
reserves for inventory.
For the six months ended June 30, 1999, Ancor reported a net loss of
$3,808,000, or $.16 per diluted share on revenues of $5,118,000 compared to
a net loss of $10,066,000, or $.88 per diluted share, on revenues of
$1,179,000 for the comparable 1998 period.
Ancor's 1999 second quarter revenues included sales of approximately
$1.4 million to original equipment manufacturers (OEMs) for storage area
networking applications. Revenues from Ancor's recently announced OEM
agreement with Sun Microsystems are not expected to materialize until the
company's fourth quarter.
Shipments of Ancor's fibre channel switches to Boeing accounted for
approximately $1.6 million of second quarter revenues and second quarter gross
margins benefited from this mix of business. The company has now completed
all shipments to Boeing under existing customer orders and any future sales
would be at significantly lower levels than in the 1999 second quarter.
The company's 1999 second quarter operating expenses were approximately
$3.8 million, up from $3.0 million in the 1998 second quarter. The company
said the increase reflects its investment in the infrastructure and resources
needed to service and support its OEM customers and that it expects operating
expenses to continue to trend upward.
During the 1999 second quarter, INRANGE Technologies, with whom Ancor
previously entered into a technology licensing agreement, purchased
500,000 Ancor common shares under a warrant to purchase up to 750,000 common
shares. After the close of the 1999 second quarter, INRANGE exercised its
warrant to purchase the remaining 250,000 Ancor common shares. In total, the
exercise of the warrants generated net proceeds of $4.4 million for Ancor.
In addition, as of June 30, 1999, all of the company's preferred stock had
been converted into common stock.
Ancor also announced that it has amended its Shareholder Rights Plan to
increase the exercise price of the rights traded with the company's common
stock from $20.00 to $200.00. The amendment was adopted in order to increase
the effectiveness of the plan adopted by the company in November 1998.
About Ancor Communications
Ancor Communications, Inc. (Nasdaq: ANCR) provides GigWorks(TM) high
performance Fibre Channel switches for storage and data-intensive network
solutions including storage-area networks (SANs). The company was the first
to deliver a Fibre Channel switch and the first to top the one-gigabit
performance level. Ancor is a member of the Fibre Channel Association, the
Storage Networking Industry Alliance, the Fibre Channel Community, the ANSI
Standards Committee and the University of New Hampshire Fibre Channel
Consortium to promote the advancement of Fibre Channel standards and
interoperability. Information about Ancor is available on the World Wide Web
at ancor.com .
Forward-looking statements as defined by the Private Securities Litigation
Reform Act of 1995 are qualified by the risk factors outlined in the documents
Ancor Communications, Inc. files with the Securities and Exchange Commission.
Statements contained in this news release regarding Sun Microsystems'
future purchases of Ancor's products and expected operating expense trends are
forward-looking statements. We cannot guarantee the timing or amounts of
purchases of our products by Sun Microsystems, if any, nor the level of future
operating expenses. Factors which may affect Ancor's ability to achieve the
results implied by such forward-looking statements include whether, as the
Fibre Channel market matures, Ancor is able to continue to provide the
technology and features required by the SAN market, or whether our products
will ultimately meet our customers' needs.
ANCOR COMMUNICATIONS, INCORPORATED
STATEMENT OF OPERATIONS
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
1999 1998 1999 1998
Net sales $3,598,655 $137,036 $5,118,369 $1,179,263
Cost of goods sold 1,549,038 4,506,911 2,213,843 5,206,519
Gross profit 2,049,617 (4,369,875) 2,904,526 (4,027,256)
Operating expenses
Selling, general
and administrative 2,058,695 1,802,684 3,810,528 3,513,801
Research
and development 1,692,650 1,219,870 3,019,237 2,669,076
Total operating
expenses 3,751,345 3,022,554 6,829,765 6,182,877
Operating loss (1,701,728) (7,392,429) (3,925,239) (10,210,133)
Nonoperating income (expense)
Interest expense (4,640) (7,126) (10,824) (20,182)
Other, primarily
interest income 60,394 98,923 127,829 164,662
Net loss (1,645,974) (7,300,632) (3,808,234) (10,065,653)
Accretion on
convertible
preferred stock (4,330) (273,425) (12,011) (424,712)
Net loss
attributable to common
shareholders $(1,650,304) $(7,574,057) $(3,820,245)$(10,490,365)
Basic and diluted
net loss per
common share $ (0.07) $ (0.63) $ (0.16) $ (0.88)
Weighted average common shares
outstanding 24,196,636 11,949,093 24,099,902 11,916,736
ANCOR COMMUNICATIONS, INCORPORATED
BALANCE SHEETS
June 30, December 31,
1999 1998
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 191,662 $ 3,477,236
Short-term investments 7,922,994 3,970,137
Accounts receivable,
less allowances of $39,492
and $39,492, respectively 1,747,587 442,600
Inventories 2,118,548 1,288,868
Prepaid expenses
and other current assets 488,141 110,398
Total current assets 12,468,932 9,289,239
Equipment,
net of accumulated depreciation 3,014,882 3,120,618
Patents, prepaid royalties,
and other assets,
net of accumulated amortization 208,363 195,668
Capitalized software development costs
net of accumulated amortization 31,655 132,568
TOTAL ASSETS $ 15,723,832 $ 12,738,093
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term debt $ 94,000 $ 139,791
Accounts payable 913,995 448,383
Accrued liabilities 779,748 955,676
Unearned revenue, current 2,798,856 2,146,936
Total current liabilities 4,586,599 3,690,786
Long-term unearned revenue,
less current 6,067,886 3,727,919
Long-term debt, less current maturities 86,183 110,997
Shareholders' Equity
Capital Stock 248,891 232,660
Additional paid-in capital 50,133,162 46,566,386
Accumulated deficit (45,398,889) (41,590,655)
Total shareholders' equity 4,983,164 5,208,391
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY $ 15,723,832 $ 12,738,093
SOURCE Ancor Communications, Inc.
CO: Ancor Communications, Inc.; INRANGE Technologies
ST: Minnesota
IN: TLS
SU: ERN |
