) RAD Ends Millennium with Record Sales; Year-End Results Exceed Sales Goal of $165 Million.

Business &Technology Editors

TEL AVIV, Israel--(BUSINESS WIRE)--Jan. 21, 2000

RAD Data Communications recorded its most successful year in 1999, with annual sales exceeding $165 million, while the company's installed base reached over four million units.

Worldwide sales increased 17% from 1998. The largest growth was experienced in Western Europe, where revenues increased by 40%. &uot;Liberalization of the European telecoms sector has spurred deployment of access networks, while competition for customers has opened up the market for multiple services,&uot; explained Dario Zipris, Vice President of Sales at RAD Data Communications. &uot;The worldwide trend toward interworking and bundling of multiple services will provide for continued growth for our company, since RAD traditionally has excelled in meshing different technologies on a single platform,&uot; he said.

European countries witnessing the best revenues were France, the UK, Germany and Sweden. Performance in North America and Asian-Pacific countries continue to be solid as well. Sales to Latin America remained steady despite the Brazilian economic crisis, which affected the economies in that region. Continuing investment in infrastructure in Africa contributed to larger than expected gains on that continent.

Key to Success

Zipris attributed RAD's success to the company's flexibility, both in terms of combining different media and services into its products and its willingness to customize products to client specifications. &uot;For example,&uot; stated Zipris, &uot;we are market leaders in the Last Mile because our products support mixed environments. This gives us a competitive edge. Our Last Mile line's success, with sales up 23% from last year, shows that we are on the right track. And our ability to add features to meet customer requirements has allowed us to win many tenders in the carrier market, which now accounts for approximately 60% of the company's sales,&uot; he noted.

Carrier-Class Equipment

&uot;Our focus on carrier applications, in addition to corporate markets, contributed to this year's success,&uot; added Zipris. RAD's ACE family of ATM products has been deployed in the public ATM networks of several carriers, including France Telecom, British Telecom, Telecom Ireland and Japan Telecom. &uot;Due to our good reputation and good rapport with our customers,&uot; Zipris continued, &uot;leading carriers have commissioned us to develop products specifically for them.&uot; In 1999, RAD developed an ISDN protocol converter for Telstra, the Australian carrier. The company is currently working hand-in-hand with Deutsche Telekom to develop devices for broadband services, and with Swedish carriers on a TDM-over-IP device. &uot;These projects assure that our close cooperation with carriers will continue to bear fruit into the year 2000,&uot; Zipris predicted.

Bestsellers

E1/T1 and Local Loop products account for the majority of RAD's sales. RAD's CVS Compressed Voice System, which was originally introduced in the American market, is spreading to Western Europe and Asia-Pacific. Frame Relay multiplexers also made a good showing, with sales up by 41% worldwide and 52% in Western Europe.

&uot;In the coming year,&uot; Zipris maintained, &uot;we will continue to invest in multiple technologies and media, such as SDSL, G.Lite and fiber. Carriers and metropolitan area networks are experimenting with high performance IP backbones and are deploying our IPmux to transport legacy traffic. We also foresee that Frame Relay will be around for a long time. Because of our interdisciplinary approach,&uot; Zipris concluded, &uot;we are not tied to any one technology, and so we can offer users and service providers the tools to capitalize on the most appropriate one for their network.&uot;

RAD Data Communications designs, manufactures and markets a broad range of high quality data communications and telecommunications product solutions for carriers, service providers and corporate networks. RAD is a member of the $390 million RAD Group of companies, a world leader in networking and internetworking product solutions.