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ETC Announces Second Quarter 2002 ResultsWaukesha, WI -- July 15, 2002 For Further Information contact: Dean Danner, President
Jeff Nigl, Chief Financial Officer
(262) 542-5600 * http://www.etcia.com
WAUKESHA, WISCONSIN, July 15, 2002 OTC Bulletin Board ELECTRONIC TELE-COMMUNICATIONS, INC. Symbol – ETCIA Electronic Tele-Communications, Inc. (ETC) today reported its second quarter 2002 results. Sales for the quarter were $1,300,470 compared to $1,214,925 for the 2001 second quarter. This yielded net earnings for the quarter of $27,811 or $0.01 per Class A common share, compared to a net loss of $723,791 or $0.29 per Class A common share for the second quarter of 2001. Sales for the first six months of 2002 were $2,410,028, compared to 2001 six month sales of $2,886,750. Losses for the first six months of 2002 were $108,621 or $0.04 per Class A Share, compared to a loss of $1,431,040 or $0.57 per Class A share for the first six months of 2001. Commenting on the second quarter results, ETC President Dean Danner said, “We are pleased to report that ETC's continued improvement has yielded a small profit for the second quarter of 2002. As we have previously reported, ETC, like many other telecommunications suppliers, is still trying to recover from one of the worst industry recessions in the last quarter century. Our sales have steadily improved by over 10% each of the last three quarters, but are still depressed from levels two years ago. We anticipate this slow recovery in our markets to continue over the next several quarters, and therefore anticipate ETC's earnings to likewise slowly improve.” “ETC returned to profitability in the second quarter, but we still have losses from the first quarter to absorb before we are profitable for the year. Our cost reductions, increased sales, and a more favorable product mix have enabled us to improve all facets of our operations. In the second half of 2002 we anticipate some of these savings will be impacted by labor and material cost increases, which we believe will be offset with increased sales, especially sales of our premier Emcee system.” Electronic Tele-Communications is a supplier of Voice Application Processing Platforms to domestic and foreign telephone utilities and of messaging systems to the commercial market. ETC's equipment provides a wide range of audio information and call handling services via telephone networks, computer networks, and the Internet. ETC, with corporate headquarters in Waukesha, Wisconsin also has operations in Norcross, Georgia. Certain statements in this press release which are not historical facts are "forward-looking” statements as defined in the Private Securities Litigation Reform Act of 1995. Any “forward-looking” statements are provided in compliance with the “Safe Harbor” provision of the Private Securities Litigation Reform Act of 1995. “Forward-looking” statements involve a number of risks and uncertainties including, but not limited to, technology changes, backlog, acquisitions, status of the economy, governmental regulations, sources of supply, expense structure, product mix, major customers, level of order flow, competition, litigation, and other risk factors detailed in the Company’s filings with the Securities and Exchange Commission. Investors are encouraged to consider the risks and uncertainties included in those filings. - - MORE – - Electronic Tele-Communications, Inc. Statements of Operations:
(unaudited) (unaudited)
Three Months Ended Six Months Ended
June 30 June 30
2002 2001 2002 2001
Net sales 1,300,470 1,214,925 2,410,028 2,886,750
Cost of products sold 567,326 753,705 1,109,610 1,759,394
Gross profit 733,144 461,220 1,300,418 1,127,356
Operating expenses:
General and administrative 181,539 304,056 374,469 605,370
Marketing and selling 302,849 475,455 576,671 1,015,128
Research and development 218,339 384,566 453,163 901,395
702,727 1,164,077 1,404,303 2,521,893
Earnings (loss) from operations 30,417 (702,857) (103,885)(1,394,537) Other income (expense) (1,606) (19,934) (2,736) (34,503) Earnings (loss) before income taxes 28,811 (722,791) (106,621)(1,429,040) Income taxes 1,000 1,000 2,000 2,000 Net earnings (loss) 27,811 (723,791) (108,621)(1,431,040) Basic and diluted earnings (loss) per share: Class A common 0.01 (0.29) (0.04) (0.57) Class B common 0.01 (0.29) (0.04) (0.57) Weighted average shares outstanding for basic and diluted 2,509,147 2,509,147 2,509,147 2,509,147 Selected Balance Sheet Data:
(unaudited)
Jun 30 Dec 31
2002 2001
Current assets 2,502,096 2,358,472
Total assets 4,143,899 4,202,923
Current liabilities 814,117 733,183
Total liabilities 1,200,150 1,150,553
Stockholders' equity 2,943,749 3,052,370
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