(MCTL) ANNOUNCEMENT: (BSNS WIRE) Despite Second Quarter Loss, MicroTel Reports Positive Cash
Despite Second Quarter Loss, MicroTel Reports Positive Cash Flow From
Operations for the First Half of 1999
Business Editors
ONTARIO, Calif.--(BUSINESS WIRE)--Aug. 16, 1999--
Cash Flow From Operations Improved by Over $2.5 Million
in the First Half of 1999 Compared to 1998
MicroTel International Inc. (OTC BB:MCTL) (the "company") today
reported that for the three months ended June 30, 1999 it recorded a
net loss of $914,000 or $.06 per share, compared with a net loss of
$218,000 or $.02 per share for the second quarter of 1998.
For the first six months of 1999, the company reported a net loss
of $1,889,000 or $.12 per share compared with a net loss of $1,165,000
or $.10 per share in the same period of 1998.
Despite the year-to-date loss, the company's cash flow produced
by operations for the first six months of 1999 was $328,000, in stark
contrast to the cash used in operations of $(2,260,000) for the first
six months of 1998. The positive cash flow from operations for the
first half of 1999 was the result of the company recording several
non-cash charges during this period, including second quarter 1999
non-cash charges of approximately $540,000 to reserve for a note
receivable and potential warranty claims from a subsidiary that was
disposed of at the end of the first quarter of 1999.
Commenting on second quarter operating results, the company's
Chairman and CEO, Carmine T. Oliva said, "We are not discouraged by
the loss in the second quarter because we have taken aggressive steps
to return the company to profitability through the recently announced
restructuring of our CXR Telcom subsidiary and additional
infrastructure cost reductions at XIT which together approach $1.4
million in annualized expense reductions. We are also encouraged by
the positive cash flow from operations for the first six months which
represents a very significant turnaround from the first half of 1998."
The statements in this news release relating to matters that are
not historical are forward-looking statements which involve risks and
uncertainties including, without limitation, economic and competitive
conditions in the markets served by the company affecting the demand
for the company's products, product pricing, market acceptance, access
to distribution channels and other risks detailed from time to time in
the company's Securities and Exchange Commission filings. These risks
could cause actual results to differ materially from those anticipated
or described herein.
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MicroTel International Inc. and Subsidiaries
Consolidated Condensed Statements of Operations
(Unaudited)
Three months ended Six months ended
June 30, June 30,
1999 1998 1999 1998
(in thousands, except per share amounts)
Net sales $ 6,801 $ 8,971 $14,311 $18,713
Cost of sales 4,411 5,555 9,314 13,061
Gross profit 2,390 3,416 4,997 5,652
Operating expenses:
Selling, general
and administrative 2,890 2,796 6,607 5,914
Engineering and
product development 477 574 1,035 1,145
Income (loss) from operations (977) 46 (2,645) (1,407)
Other expense (income)
Interest expense 83 177 202 344
Loss (gain) on sale
of subsidiary -- 90 (331) (580)
Equity in earnings of
unconsolidated
affiliates (191) -- (727) (16)
Other 40 (25) 87 (27)
Loss before income taxes (909) (196) (1,876) (1,128)
Income taxes expense 5 22 13 37
Net loss (914) (218) (1,889) (1,165)
Other comprehensive loss:
Foreign currency
translation adjustment (161) (54) (424) (19)
Total comprehensive loss $(1,074) $ (272) $(2,313) $(1,184)
Basic and diluted loss
per share $ (0.06) $ (0.02) $ (0.12) $ (0.10)
Selected Balance Sheet Items
(Unaudited)
(dollars in thousands)
June 30, 1999 Dec. 31, 1998
Total Current Assets $12,375 $15,552
Total Assets $18,539 $21,242
Total Current Liabilities $ 9,623 $ 9,623
Long Term Debt $ 1,532 $ 2,235
Stockholders' Equity $ 6,907 $ 5,482
Total Liabilities & Equity $18,539 $21,242
*T
--30--JV/np* JP/np
CONTACT: MicroTel International Inc., Ontario
James P. Butler, 909/456-4321
Web site: microtelinternational.com
KEYWORD: CALIFORNIA
INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS COMED TELECOMMUNICATIONS
EARNINGS
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