Amnex announces year end results.NEW YORK--(BUSINESS WIRE)--April 1, 1997-- Amnex to take special non-cash charges Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. in fourth quarter related to Telecom Act resulting in loss for year; Management sees strong earnings growth in 1997 Amnex Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : AMXI) today announced that it expects to report special non-cash charges to earnings in the fourth quarter of 1996 of approximately $7.5 million. The charges will result in a reported pre-tax loss for the year ended Dec. 31, 1996 of approximately $5.7 million. The charges, in the main, are due to the permanent impairment of receivables, intangible assets and investments caused primarily by the Telecommunications Act There are several laws named the Telecommunications Act
The company further announced that it expects to take additional charges in the first quarter of 1997 of between $1 million and $2 million. These one-time charges relate to the restructuring of the company's operations, which includes the closure of certain of the company's facilities; severance payments to employees and the realignment re·a·lign tr.v. re·a·ligned, re·a·lign·ing, re·a·ligns 1. To put back into proper order or alignment. 2. To make new groupings of or working arrangements between. and outsourcing of some of the company's core operating functions. Ken Baritz, Amnex's chairman and chief executive officer, stated, "These charges, which primarily relate to our domestic operator services A variety of telephone services that require human intervention, including person-to-person calls, collect calls, credit card billing and directory and dialing assistance. Such services are performed by LECs, IXCs and alternative operator services (AOS), organizations that are used by business, represent the culmination of the diversification strategy we embarked upon eighteen months ago. As a result of our strategy, our domestic operator services business, which generated over 90% of the company's revenues in 1995, is expected to generate less than 50% of the company's revenue in 1997. Though painful in the short term, these charges will clear the decks for strong earnings growth for the rest of 1997." Baritz continued, "In spite of the charges, 1996 was a successful year for AMNEX. For the second year in a row we have seen cash provided by operations grow substantially, from a negative $2.4 million in 1994 to a positive $1.7 million in 1995 to a positive $7.1 million in 1996. In addition, the company was able to successfully complete several acquisitions and joint ventures that will contribute substantial new revenue this year and accelerate our EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become growth, which we expect to more than double in 1997." Peter Izzo, president of the company's PubCom Division, stated, "The Telecommunication Act of 1996 and subsequent actions by the FCC (1) (Federal Communications Commission, Washington, DC, www.fcc.gov) The U.S. government agency that regulates interstate and international communications including wire, cable, radio, TV and satellite. The FCC was created under the U.S. and state regulators have further validated our strategy of diversifying our business into the ownership of payphones. While the short term effect of the act has contributed to the charges we are now taking, the long term benefit to our businesses should greatly exceed those losses. We have already grown our payphone payphone Noun a coin-operated telephone payphone pay n → Münztelefon nt; (card phone) → Kartentelefon nt base from 1,800 at the end of the third quarter of 1996 to over 7,500 today. Our plans were to grow that base to over 12,500 payphones by the end of 1997, but we now expect to reach that goal by the end of the third quarter. I plan on focusing my efforts on the continued success of the PubCom Division, which I expect to contribute more than $5 million in earnings to AMNEX in 1997." CONTACT: AMNEX Inc., New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Kenneth G. Baritz, 212/867-0166 |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion