TLNT Earnings:
LAKE FOREST, Calif.--(BUSINESS WIRE)--Aug. 16, 1999--Telenetics Corporation (OTC BB:TLNT), a leader in the
design and manufacture of proprietary data-communications solutions for utility and industrial automation applications, traffic
management and intelligent transportation systems, today reported financial results for the three- and six-month period ended
June 30, 1999.
For the three-month period, the Company reported net sales of $3.8 million as compared with net sales of $376,000 for the
three-month period ended June 30, 1998. The Company reported operating income of $24,000 and a net loss of $(129,000),
or $(0.01) per share, for the three-month period ended June 30, 1999, as compared with an operating loss of $(290,000) and
a net loss of $(324,000), or $(0.04) per share, for the three-month period ended June 30, 1998.
For the six-month period, the Company reported net sales of $7.6 million as compared with net sales of $1.3 million for the
six-month period ended June 30, 1998. The Company reported operating income of $478,000 and net income of $271,000,
or $0.03 per share, for the six-month period ended June 30, 1999, as compared with an operating loss of $(155,000) and a
net loss of $(278,000), or $(0.03) per share, for the six-month period ended June 30, 1998.
The Company's operating and net income for the period ended June 30, 1999, were adversely effected by unusually high
professional and other expenses for the period. The significant increase in expenses resulted primarily from professional service
expenses associated with the Company's switch to a national auditing firm, its efforts to bring its filing requirements under the
Securities and Exchange Act of 1934 and its accompanying procedures up-to-date, its effort to establish relationship with the
financial community and expenses related to debt termination costs. The Company also absorbed certain costs for the inclusion
of one month of expenses from Sunnyvale GDI (GDI), which the Company acquired on June 1, 1999. Had it not been for
theses unusually high expenses, the Company would have reported higher operating profit and positive net income for the
period.
Commenting on the financial results of second quarter, Michael A. Armani, Chairman and CEO of Telenetics, stated, ``We've
made substantive progress in the last quarter as we continue to broaden our customer base and open new markets. We are
beginning to reap the benefits of the growing acceptance of our new product offerings. As we reach the final stages of
delivering the last portions of $7.5 million automatic meter reading (AMR) project in Pittsburgh for Duquesne Light Company,
increasing number of other utilities across the country are showing interest in our Omega(TM) and AirWave(TM) AMR
solutions. We now have test sites in Florida, Maryland, Pennsylvania, Alabama, Illinois and Michigan. Our expansion in the
traffic management, which culminated with the acquisition GDI has strengthen our presence in the growing traffic management
market. The cost of the growth, however, was reflected in higher operating expenses. We strongly believe that these expenses
are investment in our future and the infrastructure necessary to support our significant growth. We continue to meet the
majority of the operational challenges associated with our growth and expansion. As we grow, we have also managed to
improve our gross profit margins.
``The second quarter was an exceptionally busy quarter as it relates to new product releases and acquisitions, including:
-- Release of AirWave(TM), patent pending wireless communication
module,
-- Acquisition of Airlink(TM) wireless technology from Greenland
Corporation, and
-- Acquisition of GDI, expanding our traffic management presence,
-- Successful negotiations in acquiring assets and microwave
technology of Sierra Digital Communications, Inc., which we
subsequently closed in July 1999.
``These milestones have established Telenetics as a leader in the AMR market, enhanced our presence in the transportation
and traffic management industries and expanded our wireless communications solutions to include cellular and microwave
technologies. The accomplishments of last quarter will make substantial contributions toward positioning Telenetics for future
growth.'
Telenetics is a leader in the design and manufacture of proprietary data-communications solutions for utility and industrial
automation applications, traffic management, intelligent transportation systems and oil and gas industry.
Forward Looking Statement Disclosure: Certain of the statements contained in this press release are ``forward-looking
statements' that involve risks and uncertainties. Actual future results could differ materially from these statements. Factors that
could cause or contribute to such differences include but are not limited to, increased competition within the utility and
industrial automation markets, the inability of the Company to fund its expected continued growth and those discussed in the
Company's Form 10-KSB for the year ended December 31, 1998 and the Form 10-QSB for the six months ended June 30,
1999.
FINANCIAL HIGHLIGHTS
Three Months Ended Three Months Ended
June 30, 1999 June 30, 1998
------------------ ------------------
Revenues $ 3,788,000 $ 376,000
Net Income (Loss)
from Operations 24,000 (290,000)
Net Income (Loss) (129,000) (342,000)
Income (Loss) Per Share
Basic (0.01) (0.04)
Diluted (0.01) (0.04)
Weighted Average
Shares Outstanding
Basic 9,578,498 7,849,732
Diluted 10,468,785 8,949,732
Six Months Ended Six Months Ended
June 30, 1999 June 30, 1998
------------------ ------------------
Revenues $ 7,626,000 $ 1,333,000
Net Income(Loss)
from Operations 478,000 (155,000)
Net Income (Loss) 271,000 (278,000)
Income (Loss) Per Share
Basic 0.03 (0.03)
Diluted 0.03 (0.03)
Weighted Average
Shares Outstanding
Basic 9,552,832 8,052,947
For additional information, visit www.telenetics.com
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