Tech Squared Reports Fiscal 1997 Results
MINNEAPOLIS, April 2 /PRNewswire/ -- Tech Squared Inc. (OTC Bulletin Board: TSQD)
today reported net sales of $36,995,000 for the year ended Dec. 31, 1997, compared
with $37,387,000 for fiscal 1996. The company had a consolidated net loss applicable to
common shares of $1,032,000, or 10 cents per share, in 1997 vs. a consolidated net
loss of $651,000, or 6 cents per share, in the previous year.
These results include a portion of the losses of Digital River, Inc., an Internet commerce
company in which Tech Squared's current effective ownership is approximately 26
percent. Excluding Tech Squared's portion of Digital River's losses, Tech Squared had
net income of $344,000 in 1997, compared with a net loss of $203,000 in 1996.
For the three months ended Dec. 31, 1997, net sales were $9,574,000,
compared with $10,873,000 for the fourth quarter of 1996. The company had
a consolidated net loss applicable to common shares of $320,000, or 3 cents per
share, for the fourth quarter of 1997 vs. a consolidated net loss of $255,000, or
2 cents per share, in the same period a year earlier.
Excluding Tech Squared's portion of Digital River's losses, the fourth quarter of
1997 was Tech Squared's sixth consecutive quarter of profitability, with net
income of $158,000 vs. $1,000 in the fourth quarter of 1996.
Joel Ronning, chairman and chief executive officer of Tech Squared, said, "We're
pleased with Tech Squared's improved operating performance during 1997, including
our improvement in gross profit percentage as a result of improved inventory
management and an increase in DTP Direct catalog sales.
"At the same time, we're very excited about the increased revenue and transaction
growth of Digital River. Digital River has developed into the world's largest source
of software inventory on the Internet over the past year, with more than 100,000
software products in its database. Its client base has grown from about three
dozen software publishers and online dealers at the beginning of 1997 to over
1,000 today."
Digital River reported sales of $2,472,000 for 1997, with $1,328,000 of that occurring
in the fourth quarter. That compares with sales of $111,000 for the year ended
Dec. 31, 1996, with the greater part of those sales occurring in the fourth quarter
of 1996. Digital River's first sale took place in August 1996.
Tech Squared, based in Minneapolis, is a national marketer and distributor o
mid- to high-end microcomputer hardware, software and peripherals primarily to
businesses in the desktop publishing, graphic arts and pre-press industries.
TECH SQUARED INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
3 months ended Year ended
Dec. 31, Dec. 31,
1997 1996 1997 1996
Net sales $9,574,011 $10,872,421 $36,995,277 $37,386,715
Cost of sales 8,382,042 9,887,190 32,527,878 33,475,525
Gross profit 1,191,966 985,599 4,467,399 3,911,190
Selling & marketing 452,372 372,469 1,882,729 2,083,961
General & administrative 566,539 863,655 2,182,458 2,446,500
Research & development -- 87,321 -- 229,690
Total operating expenses 1,018,911 1,323,345 4,045,187 4,760,151
Operating profit (loss) 173,058 (337,746) 402,212 (848,961)
Gain on sale of securities 208 -- 26,646 --
Interest expense, net (15,397) (20,143) (85,078) (43,068)
Loss from unconsolidated
subsidiary - Digital
River (459,066) -- (1,356,370) --
Loss before minority
interest in losses of
Digital River (301,197) (366,889) (1,012,590) (892,029)
Minority interest in losses
of Digital River -- 147,090 -- 275,634
Net loss (301,197) (219,799) (1,012,590) (616,395)
Preferred stock dividends 19,200 35,000 19,200 35,000
Net loss applicable to
common shares $(320,397) (254,799) $(1,031,790) (651,395)
Net loss per
common share $(0.03) $(0.02) $(0.10) $(0.06)
Weighted average
shares outstanding 10,374,870 10,374,870 10,374,870 10,374,870
Except for historical financial information, the information contained in this release
is forward-looking and subject to certain risks as described in the company's
filings with the Securities and Exchange Commission, including the company's
annual report on Form 10-K for the year ended Dec. 31, 1997. Actual results
may differ significantly based on such risks.
SOURCE Tech Squared, Inc.
CO: Tech Squared, Inc. |
