QualMark Corporation Announces First Quarter Results

Apr 19, 2001, 01:00 ET from QualMark Corporation

    DENVER, April 19 /PRNewswire/ -- QualMark Corporation (Nasdaq:   QMRK), a
 leading provider of accelerated product test systems that allow electronics
 manufacturers to rapidly and comprehensively expose design and production
 process flaws, today announced results for the first quarter ended March 31,
 2001.
     For the quarter the Company reported a net loss of $122,000, or four cents
 per basic and diluted share, on revenue of $2,715,000 versus net income of
 $71,000, or one cent per basic and diluted share, on revenue of $3,571,000 in
 the first quarter of 2000.
     Charles D. Johnston, president and CEO, attributed the decline in revenue
 over the last several quarters to economic conditions in general and a
 slowdown in capital expenditures in particular.
     "Many of our target customers are re-evaluating their capital expenditure
 budgets in light of the general slowdown in the economy, particularly the
 technology sector," said Johnston.  "We are seeing evidence of this in the
 form of order push outs and outright reversals of purchase decisions.
 However, while the short-term picture remains unclear due to a variety of
 market factors, we are more optimistic about our long-term prospects for
 renewed revenue growth as economic conditions improve."
     During the quarter QualMark shipped 16 OVS test systems to customers
 around the world while announcing the first shipments of its next generation
 Typhoon testing systems -- to two Fortune 500 companies.  Also in the first
 quarter, the Company made the final payment under its lawsuit settlement and
 paid down its bank loan, resulting in a $350,000 reduction in long-term debt.
 At the same time, the Company increased its cash and equivalents to
 $1.5 million from $940,000 at the end of the year as a result of continued
 management of working capital.
 
     QualMark Corporation, based in Denver, Colorado, develops, manufactures
 and markets accelerated life testing systems that provide manufacturers with
 the necessary information to improve product reliability by rapidly exposing
 design and manufacturing-related flaws.  The Company has installed more than
 386 of its proprietary testing systems in 18 countries and operates six of its
 own testing and consulting ("ARTC") facilities in Denver, Santa Clara, Calif.,
 Farmington Hills, Mich., Hopkinton, Mass., Huntington Beach, Calif., and
 Winter Park, Fla.  QualMark has also formed a domestic ARTC alliance in
 Austin, Texas, and international ARTC alliances in the United Kingdom,
 Ireland, Germany, the Netherlands, Italy, France and Sweden.  The Company also
 offers engineering services and products that complement the core technologies
 of QualMark and other test equipment providers.
 
 
      Statement of Operations                         First Quarter Ended
      (Unaudited)                                          March 31,
                                                      2001           2000
 
      Systems revenues                             $2,158,000     $2,711,000
      ARTC service revenue                            557,000        806,000
      Total revenue                                 2,715,000      3,517,000
      Gross profit                                  1,068,000      1,248,000
      Income (loss) from operations                   (47,000)       193,000
      Net income (loss)                              (122,000)        71,000
 
      Accretion of redeemable preferred stock and
       dividends                                      (27,000)       (24,000)
      Net income (loss) available to common
       shareholders                                  (149,000)        47,000
 
      Basic earnings (loss) per share                  $(0.04)         $0.01
      Diluted earnings (loss) per share                $(0.04)         $0.01
      Basic weighted average shares outstanding     3,610,000      3,552,000
      Diluted weighted average shares outstanding   3,610,000      3,807,000
 
 
     Some statements contained herein are forward-looking statements.  The
 Company's actual results may vary materially from the forward-looking
 statements made above due to important factors including, but not limited to,
 variability of order flow, future economic conditions, competitive products
 and pricing, new product development, the delivery of product under existing
 contracts and other factors.  Additional information concerning factors that
 could cause actual results to differ materially from those in the
 forward-looking statements made above is contained in the following documents
 on file with the U.S. Securities and Exchange Commission: the Company's
 Registration Statement on Form SB-3, filed August 25, 1997; its Form 10-KSB
 for the year ended December 31, 1999; and Quarterly Reports for 2000 and 2001
 on Form 10-QSB.
 
 

SOURCE QualMark Corporation
    DENVER, April 19 /PRNewswire/ -- QualMark Corporation (Nasdaq:   QMRK), a
 leading provider of accelerated product test systems that allow electronics
 manufacturers to rapidly and comprehensively expose design and production
 process flaws, today announced results for the first quarter ended March 31,
 2001.
     For the quarter the Company reported a net loss of $122,000, or four cents
 per basic and diluted share, on revenue of $2,715,000 versus net income of
 $71,000, or one cent per basic and diluted share, on revenue of $3,571,000 in
 the first quarter of 2000.
     Charles D. Johnston, president and CEO, attributed the decline in revenue
 over the last several quarters to economic conditions in general and a
 slowdown in capital expenditures in particular.
     "Many of our target customers are re-evaluating their capital expenditure
 budgets in light of the general slowdown in the economy, particularly the
 technology sector," said Johnston.  "We are seeing evidence of this in the
 form of order push outs and outright reversals of purchase decisions.
 However, while the short-term picture remains unclear due to a variety of
 market factors, we are more optimistic about our long-term prospects for
 renewed revenue growth as economic conditions improve."
     During the quarter QualMark shipped 16 OVS test systems to customers
 around the world while announcing the first shipments of its next generation
 Typhoon testing systems -- to two Fortune 500 companies.  Also in the first
 quarter, the Company made the final payment under its lawsuit settlement and
 paid down its bank loan, resulting in a $350,000 reduction in long-term debt.
 At the same time, the Company increased its cash and equivalents to
 $1.5 million from $940,000 at the end of the year as a result of continued
 management of working capital.
 
     QualMark Corporation, based in Denver, Colorado, develops, manufactures
 and markets accelerated life testing systems that provide manufacturers with
 the necessary information to improve product reliability by rapidly exposing
 design and manufacturing-related flaws.  The Company has installed more than
 386 of its proprietary testing systems in 18 countries and operates six of its
 own testing and consulting ("ARTC") facilities in Denver, Santa Clara, Calif.,
 Farmington Hills, Mich., Hopkinton, Mass., Huntington Beach, Calif., and
 Winter Park, Fla.  QualMark has also formed a domestic ARTC alliance in
 Austin, Texas, and international ARTC alliances in the United Kingdom,
 Ireland, Germany, the Netherlands, Italy, France and Sweden.  The Company also
 offers engineering services and products that complement the core technologies
 of QualMark and other test equipment providers.
 
 
      Statement of Operations                         First Quarter Ended
      (Unaudited)                                          March 31,
                                                      2001           2000
 
      Systems revenues                             $2,158,000     $2,711,000
      ARTC service revenue                            557,000        806,000
      Total revenue                                 2,715,000      3,517,000
      Gross profit                                  1,068,000      1,248,000
      Income (loss) from operations                   (47,000)       193,000
      Net income (loss)                              (122,000)        71,000
 
      Accretion of redeemable preferred stock and
       dividends                                      (27,000)       (24,000)
      Net income (loss) available to common
       shareholders                                  (149,000)        47,000
 
      Basic earnings (loss) per share                  $(0.04)         $0.01
      Diluted earnings (loss) per share                $(0.04)         $0.01
      Basic weighted average shares outstanding     3,610,000      3,552,000
      Diluted weighted average shares outstanding   3,610,000      3,807,000
 
 
     Some statements contained herein are forward-looking statements.  The
 Company's actual results may vary materially from the forward-looking
 statements made above due to important factors including, but not limited to,
 variability of order flow, future economic conditions, competitive products
 and pricing, new product development, the delivery of product under existing
 contracts and other factors.  Additional information concerning factors that
 could cause actual results to differ materially from those in the
 forward-looking statements made above is contained in the following documents
 on file with the U.S. Securities and Exchange Commission: the Company's
 Registration Statement on Form SB-3, filed August 25, 1997; its Form 10-KSB
 for the year ended December 31, 1999; and Quarterly Reports for 2000 and 2001
 on Form 10-QSB.
 
 SOURCE  QualMark Corporation

RELATED LINKS

http://www.qualmark.com