AirNet Announces Second Quarter 2003 Financial Results; Company Reports $1.1M Positive Cash Flow From Operations.Business Editors/High-Tech Writers MELBOURNE Melbourne, city, Australia Melbourne, city (1991 pop. 2,761,995), capital of Victoria, SE Australia, on Port Phillip Bay at the mouth of the Yarra River. Melbourne, Australia's second largest city, is a rail and air hub and financial and commercial center. , Fla.--(BUSINESS WIRE)--Aug. 13, 2003 AirNet Communications Corporation (Nasdaq:ANCC ANCC American Nurses Credentialing Center ANCC Association Nationale des Cardiaques Congénitaux ANCC Army-Navy Country Club (Arlington, VA) ANCC Area Nine Cable Council (state mandated government body in UK) ) today announced financial results for its second quarter ended June June: see month. 30, 2003. The Company reported net revenues of $4.4 million in the second quarter, compared to $7.2 million in the second quarter of 2002. The Company reported a loss from operations for the second quarter of $2.5 million, compared to a loss of $4.1 million in the second quarter of 2002. The net loss attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to common stock for the second quarter was $3.1 million, or $0.13 per basic and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared to a net loss of $5.2 million or $0.22 per basic and diluted share in the second quarter of 2002. Per share amounts for second quarter results were based on 23.9 million weighted average shares and excludes shares issuable upon the conversion of the Series B convertible preferred stock Convertible Preferred Stock Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date. Also known as "convertible preferred shares". and other convertible securities. The quarterly decline in revenue was primarily attributable to adverse market conditions. The improvement in the loss from operations in the second quarter of 2003 was primarily due to a $2.5 million decrease in operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. for the quarter. The Company also reported positive cash flow from operating activities in the amount of $1.1 million bolstered bol·ster n. A long narrow pillow or cushion. tr.v. bol·stered, bol·ster·ing, bol·sters 1. To support or prop up with or as if with a long narrow pillow or cushion. 2. by $5.8 million in cash collections that included a $1.1 million deposit on a previously announced order. Major events in the second quarter include: -- Received and announced approximately $7.5 million in purchase orders -- Collected $5.8 million in accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying and cash deposits. -- Executed an investment agreement for $16M in senior, secured, convertible notes. -- Reduced operating expenses by more than $2.5 million or 43% on a "quarter-over-quarter" basis. Conference Call AirNet's management will host a conference call at 5:00 p.m. ET today to discuss the results and provide an outlook for the third quarter. Those interested in listening to the conference call should dial (785) 832-2041, Conference ID: AIRNET. For those who cannot participate in the live conference call, a replay will be available beginning at 8 p.m. ET on Wednesday Wednesday: see week. , August 13, 2003, until midnight ET on August 21, 2003. The replay number for the conference call is (402) 220-1144. About AirNet AirNet Communications Corporation is a leader in wireless base stations and other telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. equipment that allow service operators to cost-effectively and simultaneously offer high-speed high-speed adj. 1. Operated or designed for operation at high speed: a high-speed food processor. 2. Taking place at high speed: a high-speed chase. 3. wireless Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the and voice services to mobile subscribers. AirNet's patented broadband broadband Term describing the radiation from a source that produces a broad, continuous spectrum of frequencies (contrasted with a laser, which produces a single frequency or very narrow range of frequencies). , software-defined AdaptaCell(TM) base station solution provides a high-capacity base station with a software upgrade path to the wireless Internet. The Company's AirSite(R) Backhaul (1) The original definition of backhaul was to transmit a telephone call or data beyond its normal destination point and then back again in order to utilize available personnel (operators, agents, etc.) or network equipment that is not located at the destination location. Free(TM) base station carries wireless voice and data signals back to the wireline network, eliminating the need for a physical backhaul link, thus reducing operating costs operating costs npl → gastos mpl operacionales . AirNet has 69 patents issued or filed and has received the coveted cov·et v. cov·et·ed, cov·et·ing, cov·ets v.tr. 1. To feel blameworthy desire for (that which is another's). See Synonyms at envy. 2. To wish for longingly. See Synonyms at desire. World Award for Best Technical Innovation from the GSM Association (GSM Association, Dublin, Ireland, www.gsmworld.com) A membership association founded in 1987 that promotes the development and evolution of the GSM communications standard worldwide. , representing over 400 operators around the world. More information about AirNet may be obtained by calling 321.984.1990, or by visiting the AirNet Web site at http://www.airnetcom.com. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement Under the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 and Other Applicable Law Certain statements in this news release may constitute forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. Private Securities Litigation Reform Act of 1995 (the Reform Act), Section 27A of the United States Securities Act of 1933 and Section 21E of the United States Securities and Exchange Act of 1934. These forward-looking statements may relate to anticipated financial performance, management's plans and objectives for future operations, business prospects, market conditions, financial forecasts and other matters. All statements contained in this news release that do not relate to matters of historical fact should be considered forward-looking statements, and are generally identified by words such as "anticipate," "believe," "estimate," "expect," "intend," "plan" and "objective" and other similar expressions. Readers should not place undue reliance on the forward-looking statements contained in this news release. Such statements are based on management's beliefs and assumptions and on information currently available to management and are subject to risks, uncertainties and changes in condition, significance, value and effect. Such risks or uncertainties are that there can be no assurance that the Company will be successful in obtaining new business; that the Company's lenders may foreclose fore·close v. fore·closed, fore·clos·ing, fore·clos·es v.tr. 1. a. To deprive (a mortgagor) of the right to redeem mortgaged property, as when payments have not been made. b. on all assets of the Company (including all intellectual property rights) in the event of a default under the security agreement associated with the planned debt financing Debt Financing When a firm raises money for working capital or capital expenditures by selling bonds, bills, or notes to individual and/or institutional investors. In return for lending the money, the individuals or institutions become creditors and receive a promise to repay , and that the company may not be able to continue to operate as a going concern prior to or after the consummation CONSUMMATION. The completion of a thing; as the consummation of marriage; (q.v.) the consummation of a contract, and the like. 2. A contract is said to be consummated, when everything to be done in relation to it, has been accomplished. of the transaction. These and other risks are detailed in reports and documents filed by the Company with the United States Securities and Exchange Commission. Such risks, uncertainties and changes in condition, significance, value and effect, many of which are beyond the Company's control, could cause the Company's actual results and other future events to differ materially from those anticipated. The Company does not, however, assume any obligation to update these forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting such forward-looking statements. AirNet(R) and AirSite(R) are registered trademarks with the U.S. Patent and Trademark Office. The stylized styl·ize tr.v. styl·ized, styl·iz·ing, styl·iz·es 1. To restrict or make conform to a particular style. 2. To represent conventionally; conventionalize. AirNet mark, AdaptaCell(TM), Super Capacity(TM), Backhaul Free(TM), and We're we're Contraction of we are. we're we are Ready for Anything(TM) are trademarks of AirNet Communications Corporation. Other names are registered trademarks or trademarks of their respective companies or organizations.
FINANCIAL STATEMENTS
(all numbers in $000's except per share data and shares outstanding)
(All financial information included is unaudited.)
CONDENSED STATEMENT OF OPERATIONS
For the three For the six
months ended months ended
June 30, June 30,
2003 2002 2003 2002
----------- ----------- ----------- -----------
NET REVENUES $4,440 $7,210 $6,235 $13,720
COST OF REVENUES 3,311 5,419 4,739 9,983
WRITE-DOWN OF EXCESS
AND OBSOLETE INVENTORY 196 - 196 -
----------- ----------- ----------- -----------
Gross profit 933 1,791 1,300 3,737
OPERATING EXPENSES:
Research and
development 2,062 3,210 4,589 6,642
Sales and marketing 536 1,450 1,355 2,962
General and
administrative 815 1,308 1,808 2,588
Gain on vendor
settlement - (30) - (30)
----------- ----------- ----------- -----------
Total costs
and expenses 3,413 5,938 7,752 12,162
----------- ----------- ----------- -----------
LOSS FROM OPERATIONS (2,480) (4,147) (6,452) (8,425)
----------- ----------- ----------- -----------
TOTAL OTHER (EXPENSE)
INCOME, NET (46) 66 (69) 194
----------- ----------- ----------- -----------
NET LOSS (2,526) (4,081) (6,521) (8,231)
ACCRETION OF DISCOUNT -
REDEEMABLE PREFERRED
STOCK - (483) - (939)
PREFERRED DIVIDENDS (600) (600) (1,200) (1,200)
----------- ----------- ----------- -----------
NET LOSS ATTRIBUTABLE
TO COMMON STOCK $(3,126) $(5,164) $(7,721) $(10,370)
=========== =========== =========== ===========
NET LOSS PER SHARE
ATTRIBUTABLE TO
COMMON STOCKHOLDERS-
BASIC AND DILUTED $(0.13) $(0.22) $(0.32) $(0.44)
=========== =========== =========== ===========
WEIGHTED AVERAGE SHARES
OUTSTANDING - USED
IN CALCULATING BASIC
AND DILUTED LOSS
PER SHARE 23,854,132 23,810,068 23,852,865 23,800,014
=========== =========== =========== ===========
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
CASH FLOW SUMMARY
For the three For the six
months ended months ended
June 30, June 30,
2003 2002 2003 2002
----------- ----------- ----------- -----------
CASH PROVIDED BY (USED
IN) OPERATING
ACTIVITIES $1,128 $360 $(3,064) $3,850
CASH USED BY INVESTING
ACTIVITIES (61) (12) (98) (27)
CASH PROVIDED BY
FINANCING ACTIVITIES 1,196 5 5,968 (135)
----------- ----------- ----------- -----------
NET CHANGE IN CASH $2,263 $353 $2,806 $3,688
=========== =========== =========== ===========
----------------------------------------------------------------------
----------------------------------------------------------------------
CONDENSED BALANCE SHEETS
As of
June 30, December 31,
2003 2002
----------- -----------
ASSETS
Cash and cash
equivalents $6,011 $3,205
Accounts
receivable - net 2,013 569
Inventories 12,879 14,459
Notes receivable 735 923
Other current assets 605 1,063
----------- -----------
TOTAL CURRENT ASSETS 22,243 20,219
PROPERTY AND
EQUIPMENT, NET 6,747 8,160
OTHER LONG-TERM ASSETS 2,314 2,451
----------- -----------
TOTAL ASSETS $31,304 $30,830
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable $2,631 $2,801
Accrued expenses 3,454 3,597
Current portion
of capital lease
obligations 24 53
Customer deposits 1,800 102
Deferred revenues 1,149 1,403
----------- -----------
TOTAL CURRENT
LIABILITIES 9,058 7,956
TOTAL LONG-TERM
LIABILITIES 6,651 837
TOTAL STOCKHOLDERS'
EQUITY 15,595 22,037
----------- -----------
TOTAL LIABILITIES &
STOCKHOLDERS' EQUITY $31,304 $30,830
=========== ===========
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