Ariel Corporation Reports Unaudited First Quarter Results
CRANBURY, N.J., April 26 /PRNewswire/ -- Ariel Corp. (Nasdaq: ADSP) today reported net sales for the three months ended March 31, 2000 of $2,072,221 as compared to net sales of $3,073,529 reported for the three months ending March 31, 1999. The net loss for the three months ending March 31, 2000 was ($2,812,977) or ($.24) basic and dilutive loss per share. Comparatively, the first quarter 1999 net loss was ($3,008,817) or basic and dilutive loss per share of ($.31). The decrease in sales is the result of a shift in orders from original equipment manufacturers (OEMs) to future quarters and a delay in the release of new RS4200 remote access products. The Company recorded a backlog of approximately $2 million as of March 31, 2000 as compared to $519,000 as of December 31, 1999. As a percent of sales, gross margins were 58% for the quarter ending March 31, 2000 as compared to 55% for the first quarter of 1999. Gross margin percent improvement from 55% to 58% was the result of continued focus on pricing and inventories. Operating expenses decreased $758,474 (or 16%) to $4,016,856 from $4,775,330 for the three months ending December 31, 1999. The decrease in operating expenses was $687,029 (or 15%) as compared with the same period last year. Despite the reduction in revenues, operating losses were reduced by $471,093 to ($2,813,009) as compared to the quarter ending December 31, 1999. The operating loss was reduced by $210,945 as compared to ($3,023,954) for the three months ended March 31, 1999. On February 24, 2000 the Company completed a private placement resulting in proceeds of approximately $8 million. Cash as of March 31, 2000 was $11,122,527 and working capital was $12,871,272 as compared to cash of $7,088,431 and working capital of $7,827,522 as of December 31, 1999. "In Q1, we reduced the operating loss and increased backlog. Our new RS4200 products began shipping and have been well received and the field trial process for our signaling gateway technology has begun. As a result of the expense control programs implemented last year, operating expenses were reduced 15% as compared to the fourth quarter of 1999 and we continue to aggressively manage expenses and cash", commented CEO and President, Jay H. Atlas. He added, "While we are not happy with Q1 sales performance, we remain optimistic about both our OEM and ISP prospects for the mid and long term." More About Ariel Ariel Corp. (Nasdaq: ADSP) is a leading provider of high-density remote access plug-in cards for applications such as Internet access, corporate Intranet/Extranet access, on-line services, telecommuting, transaction processing, and unified messaging. Ariel's remote access products make it easy for OEMs and system integrators targeting ISPs, corporate enterprises and other service providers to add high-density remote access to open systems platforms running a variety of popular operating systems, including Windows NT and Linux. Ariel's high-density remote access cards provide V.34, V.90-compatible 56K, and basic rate ISDN remote dial-in, LAN dial-out, and Internet back-haul. Available in ISA, PCI and CompactPCI formats, the cards connect to T1, E1, ISDN, and POTS lines. Ariel's remote access products run Windows NT and Linux out of the box. An SDK is available for OEMs who want to use Ariel's remote access products with other operating systems. For more information on Ariel products, please contact Ariel Corporation at 2540 Route 130, Cranbury, NJ 08512. Phone: 609-860-2900. Fax: 609-860-1155. Email: email@example.com. World Wide Web: http://www.ariel.com. Statements contained in this press release that are not historical facts are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements involve risks and uncertainties, including market acceptance of the Company's products by technical original equipment manufacturers and internet service providers, the timely development and acceptance of new products, the impact of competitive products and pricing, changing market conditions and the other risks detailed from time to time in the Company's filings with the SEC. These risks and uncertainties could cause actual results to differ materially from those projected or currently expected. These forward-looking statements represent the Company's judgment as of the date of this release. The Company disclaims, however, any intent or obligation to update these forward-looking statements. ARIEL CORPORATION CONDENSED PRELIMINARY CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended March 31, 2000 1999 SALES $2,072,221 $3,073,529 GROSS MARGIN 1,203,847 1,679,931 OPERATING EXPENSES 4,016,856 4,703,885 LOSS FROM OPERATIONS ($2,813,009) ($3,023,954) OTHER INCOME (EXPENSE), NET 32 15,137 INCOME/(LOSS) BEFORE PROVISION FOR INCOME TAXES ($2,812,977) ($3,008,817) PROVISION FOR INCOME TAXES 0 0 NET INCOME/(LOSS) ($2,812,977) ($3,008,817) BASIC PER SHARE DATA: BASIC WEIGHTED AVERAGE OF COMMON SHARES OUTSTANDING 11,703,359 9,755,150 BASIC EARNINGS/(LOSS) PER SHARE ($0.24) ($0.31) ARIEL CORPORATION CONDENSED PRELIMINARY CONSOLIDATED BALANCE SHEET (Unaudited) March 31, December 31, ASSETS 2000 1999 Current Assets Cash and cash equivalents $11,122,527 $7,088,431 Accounts receivable, net 1,968,415 3,091,362 Inventories 3,104,783 3,303,057 Prepaid Expenses 670,521 775,943 Other receivables 356,993 383,676 17,223,239 14,642,469 Equipment, net 1,460,681 1,387,128 Goodwill, Intangible & Other assets 3,603,867 3,787,475 Total assets $22,287,787 $19,817,072 LIABILITIES & STOCKHOLDER'S EQUITY Liabilities $6,193,324 $8,819,833 Stockholder's equity 16,094,463 10,997,239 Total liabilities & stockholder's equity $22,287,787 $19,817,072
SOURCE Ariel Corporation
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