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 * http://www.etcia.com
ETC ANNOUNCES 1998 YEAR END RESULTS
WAUKESHA, WISCONSIN, February 17, 1999 NASDAQ SmallCap Market
ELECTRONIC TELE-COMMUNICATIONS, INC. Symbol - ETCIA (Electel)
Electronic Tele-Communications, Inc. (ETC) today reported final audited results for its
fourth quarter and fiscal year, confirming its previously released preliminary unaudited
results. Sales in 1998 were $13,149,994, resulting in earnings of $179,324 or $0.08 per
Class A share, compared to 1997 sales of $11,636,464 and a loss of $677,339 or $0.25 per
Class A share. For the 1998 fourth quarter, ETC reported earnings of $350,691 or $0.14 per
Class A share on sales of $4,268,546, compared to a fourth quarter 1997 loss of $372,298
or $0.15 per Class A share on sales of $2,539,653.
Commenting on the 1998 results, ETC President Dean Danner said, "1998 began slow, but
steadily improved as the year went on. The improved earnings are a result of changes we
made in our Sales and Marketing Departments, coupled with increased acceptance of our DNA
Voice Platform product. The strong fourth quarter sales have enabled ETC in January 1999
to repay all of its 1998 bank borrowings, providing a solid balance sheet for moving
forward in 1999."
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, provides 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.
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.
Electronic Tele-Communications, Inc. and Subsidiary
Consolidated Statements of Operations:
Three Months Ended Twelve Months Ended
December 31 December 31
1998 1997 1998 1997
Net sales 4,268,546 2,539,653 13,149,994 11,636,464
Cost of product sold 2,430,080 1,462,846 7,122,327 6,644,969
Gross profit 1,838,466 1,076,807 6,027,667 4,991,495
Operating expenses:
General and administrative 305,316 349,494 1,421,910 1,642,345
Marketing and selling 525,522 567,224 2,350,465 2,274,716
Research and development 434,676 410,464 1,751,603 1,784,590
1,265,514 1,327,182 5,523,978 5,701,651
Earnings (loss) from operations 572,952 (250,375) 503,689 (710,156)
Other income (expense) (29,761) (21,423) (109,865) (51,183)
Earnings (loss) before
income taxes 543,191 (271,798) 393,824 (761,339)
Income taxes (benefit) 192,500 100,500 214,500 (84,000)
Net earnings (loss) 350,691 (372,298) 179,324 (677,339)
Basic and diluted earnings
(loss) per share:
Class A common 0.14 (0.15) 0.08 (0.25)
Class B common 0.14 (0.15) 0.04 (0.33)
Weighted average shares outstanding
for basic and diluted 2,508,947 2,507,156 2,508,947 2,504,751
Selected Balance Sheet Data:
Dec 31 Dec 31
1998 1997
Current assets 5,156,211 3,934,664
Total assets 8,438,766 7,097,509
Current liabilities 2,396,881 1,080,219
Total liabilities 2,449,274 1,206,979
Stockholders' equity 5,989,492 5,890,530
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