eOn Communications Reports First Quarter Revenue Increase

Dec 14, 2010, 10:00 ET from eOn Communications Corporation

CORINTH, Miss., Dec. 14, 2010 /PRNewswire-FirstCall/ -- eOn Communications Corporation™ (Nasdaq: EONC) (the "Company"), a leading provider of telecommunications solutions, today reported first fiscal quarter results for the period ended October 31, 2010.

First quarter revenue increased 30% to $5,863,000 from $4,525,000 in the first quarter of last year, primarily due to the inclusion of Cortelco Systems Puerto Rico revenue in which majority ownership was acquired on June 9, 2010. Net loss for the quarter was $247,000 or $0.09 per common share compared to net income of $379,000 or $0.14 per common share in the quarter ended October 31, 2009. Our operating results were negatively impacted by an inventory reserve provision of approximately $119,000 attributable to our China operations. Also included in net income for the quarter was $156,000 of imputed interest expense due to the amortization of the difference between the face value of the contingent obligation to the former Cortelco shareholders and the discounted present value of the note payable recorded on the balance sheet.  Net loss for the quarter excluding the impact of the imputed interest expense was $91,000 or $0.03 per common share.  

Mr. David Lee, chairman of eOn's Board of Directors noted, "Our increase in revenue is encouraging and reflects our continued commitment and plan of sustained profitability. Our net income for the quarter excluding imputed interest and the extraordinary inventory reserve provision was $28,000 despite continued adverse economic conditions."

About eOn Communications™

eOn Communications Corporation™ is a global provider of innovative communications solutions.  Backed by over 20 years of telecommunications engineering expertise, our solutions enable our customers to easily leverage advanced technologies in order to communicate more effectively.    To find out more information about eOn Communications and its solutions, visit the World Wide Web at www.eoncommunications.com, or call 800-955-5321.

Note:

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements involve risks and uncertainties, including technical and competitive factors, which could cause the Company's results and the timing of certain events to differ materially from those discussed in the forward-looking statements.  Such risks are detailed in eOn Communications Corporation's most recent Form 10-Q filing with the Securities and Exchange Commission.

eOn Communications Corporation, the mark eOn, and eQueue are trademarks of eOn Communications Corporation.

EON COMMUNICATIONS CORPORATION

Consolidated Statements of Operations (Unaudited)

(Dollars in thousands, except per share data)

Three Months Ended

October 31,

2010

2009

REVENUE

    Net revenue

$ 5,863

$ 4,525

COST OF REVENUE

    Cost of revenue

4,250

2,804

         Gross profit

1,613

1,721

OPERATING EXPENSE

    Selling, general and administrative

1,571

1,155

    Research and development

133

137

    Other expenses

33

19

         Total operating expense

1,737

1,311

         (Loss) income from operations

(124)

410

OTHER INCOME (EXPENSE)

    Interest expense, net

(158)

(53)

    Equity in earnings of unconsolidated investee

-

1

         Total other expense

(158)

(52)

         (Loss) income before income taxes

(282)

358

Income tax expense (benefit)

-

(21)

    Net (loss) income

(282)

379

         Less:  Net loss attributable to noncontrolling interest

(35)

-

    Net (loss) income attributable to eOn Communications shareholders

$  (247)

$    379

COMPREHENSIVE (LOSS) INCOME

Net (loss) income 

$  (247)

$    379

Unrealized gains on available-for-sale securities

-

4

Foreign currency translation adjustment

2

-

    Comprehensive (loss) income

$  (245)

$    383

Weighted average shares outstanding

    Basic

2,855

2,735

    Diluted

2,857

2,736

Basic (loss) income per share

$ (0.09)

$   0.14

Diluted (loss) income per share 

$ (0.09)

$   0.14

Less than $0.01

eOn Communications Corporation

Condensed Consolidated Balance Sheets

(Dollars in thousands, except share and per share amounts)

October 31,

2010

July 31,

2010

(unaudited)

ASSETS

Current assets:

      Cash and cash equivalents

$        3,518

$   4,108

    Trade accounts receivable, net of allowance of $235 and $235, respectively

3,863

4,168

    Trade accounts receivable - related party

-

8

    Inventories

4,629

4,948

    Prepaid and other current assets

321

257

          Total current assets

12,331

13,489

Property and equipment, net

261

279

Intangibles, net

978

847

Investments

990

990

           Total current assets

$      14,560

$ 15,605

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

    Trade accounts payable

$        1,849

$   2,361

    Notes payable - related party

882

674

    Accrued expenses and other

1,922

1,977

    Total current liabilities

4,653

5,012

     Notes payable - related party, net of current portion

3,195

3,647

          Total liabilities

7,848

8,659

Commitments and contingencies

Stockholders'  equity:

    Preferred stock, $0.001 par value, (10,000,000 shares authorized, no shares issued and outstanding)

-

-

    Common stock, $0.005 par value (10,000,000 shares authorized, 2,997,546 and 2,989,269 shares issued, respectively)

15

15

    Additional paid-in capital

56,264

56,269

    Treasury stock, at cost (139,580 shares)

(1,503)

(1,503)

    Accumulated deficit

(48,636)

(48,389)

    Accumulated other comprehensive income

112

110

    Total eOn Communications Corp. stockholders' equity

6,252

6,502

Noncontrolling interest

460

444

    Total stockholders' equity

6,712

6,946

    Total liabilities and stockholders' equity

$      14,560

$ 15,605

SOURCE eOn Communications Corporation



RELATED LINKS

http://www.eoncommunications.com