N E W S R E L E A S E
FOR IMMEDIATE RELEASE
For Further Information contact: Dean Danner, President
Jeff Nigl, Chief Financial Officer
(262) 542-5600
ETC ANNOUNCES 1997 YEAR END RESULTS & 1998 DIVIDEND
WAUKESHA, WISCONSIN, February 27, 1998 NASDAQ National Market
ELECTRONIC TELE-COMMUNICATIONS, INC. Symbol - ETCIA (Electel)
Electronic Tele-Communications, Inc. (ETC) today reported 1997 sales of
$11,636,464 resulting in a loss of $677,339 or $0.25 per Class A share, compared
to 1996 sales of $12,913,830 and earnings of $256,566 or $0.12 per Class A share.
For the 1997 fourth quarter, ETC reported a loss of $372,298 or $0.15 per Class
A share on sales of $2,539,653, compared to fourth quarter 1996 earnings of
$438,235 or $0.18 per Class A share on sales of $4,052,410.
Commenting on the 1997 results, ETC President Dean Danner said,"The 1997 results
are clearly not acceptable, and we are taking steps to change how we sell our
products. ETC produces quality products and services, and we must do a better job
of sales and distribution of those products into the changing deregulated
marketplace. Included in these changes are new faces in our Sales and Marketing
management. Scott Stephenson joined ETC late in the third quarter of 1997 as
Director of Marketing and Cynthia Carlson took over as Vice President of Sales
at the end of the year. Although we anticipate a poor first quarter of 1998,
Cynthia and Scott have already had a positive impact on ETC's sales activity
which should result in increased sales as 1998 progresses."
ETC also announced that its Board of Directors has declared a dividend for the
first quarter of 1998. ETC has paid dividends every year since it went public
in 1985, and typically declares two dividends each year. This dividend payment
will be $0.04 per share and will be paid on March 31, 1998 to all Class A
shareholders of record on March 10, 1998.
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, compatible with most telephone
systems, is sold or leased to provide a wide range of audio information and call
handling services via the telephone network.
ETC, with corporate headquarters in Waukesha, Wisconsin, also has operations in
Atlanta, Georgia and Pleasanton, California.
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Electronic Tele-Communications, Inc. and Subsidiary
Consolidated Statements of Operations
Three-Month and Twelve-Month Periods Ended December 31, 1997 and 1996
(Unaudited)
Three Months Twelve Months
1997 1996 1997 1996
---------- ---------- ---------- ----------
NET SALES 2,539,653 4,052,410 11,636,464 12,913,830
COST OF PRODUCTS SOLD 1,462,846 1,953,536 6,644,969 6,503,886
---------- ---------- ---------- ----------
GROSS PROFIT 1,076,807 2,098,874 4,991,495 6,409,944
OPERATING EXPENSES:
General and administrative 349,494 451,363 1,642,345 1,661,419
Marketing and selling 567,224 545,770 2,274,716 2,332,151
Research and development 410,464 408,249 1,784,590 1,980,856
---------- ---------- ---------- ----------
1,327,182 1,405,382 5,701,651 5,974,426
---------- ---------- ---------- ----------
EARNINGS (LOSS) FROM OPERATIONS (250,375) 693,492 (710,156) 435,518
OTHER INCOME (EXPENSE):
Interest expense (10,242) (783) (19,278) (1,859)
Interest income 49 11,086 7,408 23,963
Miscellaneous (11,230) (24,060) (39,313) (39,656)
---------- ---------- ---------- ----------
(21,423) (13,757) (51,183) (17,552)
---------- ---------- ---------- ----------
EARNINGS (LOSS) BEFORE
INCOME TAXES (271,798) 679,735 (761,339) 417,966
Income taxes (benefit) 100,500 241,500 (84,000) 161,400
---------- ---------- ---------- ----------
NET EARNINGS (LOSS) (372,298) 438,235 (677,339) 256,566
========== ========== ========== ==========
EARNINGS (LOSS) PER SHARE:
Class A common (0.15) 0.18 (0.25) 0.12
Class B common (0.15) 0.18 (0.33) 0.04
Weighted average common
shares outstanding 2,507,156 2,503,949 2,504,751 2,503,949
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