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Technology Stocks : Ampex Corporation (AEXCA) -- Ignore unavailable to you. Want to Upgrade?

To: j. w. kampfe who wrote (8103)	5/4/1999 4:38:00 PM
From: Paul Lee	Read Replies (1) \| Respond to of 17679

Ampex Corporation Reports First Quarter Loss of $1.9 Million and $0.04 Per Share REDWOOD CITY, Calif.--(BUSINESS WIRE)--May 4, 1999--Ampex Corporation (Amex:AXC) reported today a net loss of approximately $1.9 million and a diluted loss per share of $0.04 for the quarter ended March 31, 1999 compared to net income of $4.1 million and diluted earnings per share of $0.09 for the quarter ended March 31, 1998. Sales in the first quarter of 1999 were $15.0 million compared to $16.8 million in the first quarter of 1998. Significant factors contributing to results in the first quarter of 1999 were a loss from the operations of MicroNet Technology, Inc ("MicroNet"), a subsidiary which the Company acquired in June 1998 ($0.03 per diluted share); expenses of its recently established internal Internet video operations ($0.02 per diluted share); and an increase in net interest expense from the issuance of its 12% Senior Notes due 2003 ($0.01 per diluted share). Earnings for the quarter ended March 31, 1999 were positively impacted by $0.02 per diluted share due primarily to an increase in recurring royalty income from new licensees over the comparable period in 1998. In the first quarter of 1998, earnings were favorably impacted by $0.11 per diluted share from the settlement of a state tax dispute which was in part offset by a charge of $0.06 per diluted share related to restructuring charges in the quarter. No tax settlements or restructuring charges were recorded in the first quarter of 1999. Sales declined by $1.8 million in the quarter ended March 31, 1999 from the comparable quarter in 1998, primarily due to lower sales by the Company's Ampex Data Systems subsidiary of instrumentation products to government customers resulting from budgetary restrictions, which the Company has previously disclosed. These sales declines were offset in part by the inclusion of revenues of MicroNet, which increased sequentially from fourth quarter 1998 levels. The Company does not currently expect that sales to government customers will improve in the second quarter of 1999. The Company anticipates continued sales growth from MicroNet's high performance disk array products in which the Company has been investing and which were introduced in the first quarter of 1999. The Company has previously announced that it is building a national and global Internet video network. In the first quarter of l999, selling and administrative expenses include the costs of the Company's Internet video operations, consisting principally of its network management group and production facilities. The Company has announced the construction of Internet video production and distribution facilities in New York City and Los Angeles where streaming video content specifically designed for distribution on the world wide web will be produced for the Company and third parties. The Company anticipates significantly increased expenses for these facilities in future periods and is also building a marketing programming and technology group which will be responsible for the Company's wholly-owned operation and for coordination with its affiliates. Presently, the Company's minority investments in TV onthe WEB, Inc. (www.tvontheweb.com) and Alternative Entertainment Network, Inc. (www.aentv.com) are accounted for using the cost method under generally accepted accounting principles. Accordingly, the results of their operations are excluded from the consolidated results of the Company for the quarter ended March 31, l999. Should the Company elect to exercise its option to increase its investment in these affiliates and to obtain a majority interest, at such time, the Company will be required to include their operating losses in its consolidated financial statements. Operating losses of the Company's internal Internet video activities as well as those of its current affiliates or others which it may acquire in the future may result in the Company recording material losses in future quarters in 1999 and for the year as a whole.