Ampex Corporation Reports First Quarter 2000 Financial Results.Business Editors REDWOOD CITY Redwood City, city (1990 pop. 66,072), seat of San Mateo co., W Calif., on San Francisco Bay; inc. 1868. Manufactures include commmunications, electrical, electronic, and medical equipment. , Calif.--(BUSINESS WIRE)--May 10, 2000 Ampex (Ampex Corporation, Redwood City, CA, www.ampex.com) A manufacturer of video storage and image processing products. Founded in 1944 by Alexander M. Poniatoff, Ampex pioneered the video recording industry, introducing the first videotape recorder in 1956 and providing innovative products Corporation (Amex:AXC AXC Chief Aviation Antisubmarine Warfare Technician (Naval Rating) AXC Add Cross-Connect Card ) reported a net loss of $6.7 million or $0.12 per 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 for the first quarter of 2000. The Company's Internet video Video material obtained from the Internet. It may refer to streaming video from real time broadcasts, streaming archival material or downloading video files for watching later, all of which are viewed on the computer. business contributed an operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of approximately $0.13 per diluted share. In the first quarter of 1999, the Company reported a loss of approximately $0.04 per diluted share, when Internet video operations were not material to the Company's financial results. Revenue of the Company's continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the increased by 27% in the first quarter of 2000, reflecting the inclusion of 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 revenues and an increase of 17% in royalty income from technology licensing, and a 15% increase in sales of disk arrays by the Company's MicroNet subsidiary. During the quarter, MicroNet's new Storage Area Networking product, SANcube, received "Best of Show" award at MAC Expo in San Francisco San Francisco (săn frănsĭs`kō), city (1990 pop. 723,959), coextensive with San Francisco co., W Calif., on the tip of a peninsula between the Pacific Ocean and San Francisco Bay, which are connected by the strait known as the Golden . It is anticipated that SANcube shipments will commence in the second quarter. Ampex Data Systems Corporation, a subsidiary, which the Company intends to sell and which is accounted for as a discontinued operation discontinued operation A segment of a business that has been abandoned or sold or for which plans for one or another of these actions have been approved. See also continuing operations. ("Data Systems"), reported improved results; a profit of $0.01 per diluted share in the first quarter of 2000, compared to a loss of $0.02 per diluted share in the prior year period. In February February: see month. 2000, iNEXTV, which conducts the majority of the Company's Internet video activities, formally launched a new video website, EXBTV.com based in Washington Washington, town, England Washington, town (1991 pop. 48,856), Sunderland metropolitan district, NE England. Washington was designated one of the new towns in 1964 to alleviate overpopulation in the Tyneside-Wearside area. D.C. EXBTV.com brings coverage of executive agencies such as the SEC, 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 FDA FDA abbr. Food and Drug Administration FDA, n.pr See Food and Drug Administration. FDA, n.pr the abbreviation for the Food and Drug Administration. to targeted business users. In connection with the launch, EXBTV commenced audience development with a major advertising and promotional campaign in the Washington D.C. area which the Company plans to extend to national audiences in coming months. Also during the first quarter, TV onthe WEB.com Web.com, Inc (NASDAQ: WWWW), formerly Interland (NASDAQ:INLD), was a provider of websites and web services to small businesses and consumers, based in Atlanta, Georgia. Web. , the Company's national web video services affiliate based in Reston, Virginia Reston is an internationally known planned community whose goal was to revolutionize post-World War II concepts of land use and residential/corporate development in American suburbia. , completed several new projects, including Microsoft (Microsoft Corporation, Redmond, WA, www.microsoft.com) The most successful and influential software company. Microsoft's software and Intel's hardware pioneered the PC and revolutionized the computer industry. Corporation's Windows 2000 launch in San Francisco. iNEXTV continued to produce video segments for its archive in preparation for the formal launch of the initial channels on its 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 City-based istyle.com website. istyletv.com is targeted to the personal passions and interests of affluent web users. The Company's Internet video activities are funded from its own liquid resources that amounted to $33.1 million at March 31, 2000. The Company also expects to generate significant funds from the sale of its Data Systems subsidiary, which will be available for investment in iNEXTV. During the quarter, the Company invested approximately $5.7 million in capital additions and continuing operations, principally Internet video, and it invested approximately $3.1 million in discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. primarily to provide working capital for Data Systems in connection with product shipments scheduled for later in the year. Ampex Corporation, www.Ampex.com, headquartered in Redwood City, CA is one of the world's leading innovators innovators people who will try new things. early innovators important figures in the farming or client community because they are the leaders in the introduction of new techniques and management systems. of technologies for the visual information age. Its iNEXTV subsidiary is the premier developer and netcaster See Netscape Netcaster. of video for the Internet. The iNEXTV network of affiliated video websites currently includes: AENTV.com, one of the largest on-demand On-Demand refers to a service or feature which addresses the user's need for instant gratification and immediacy of use. In most cases the value proposition for an on-demand service is wrapped up in the fact that the user or consumer of the service avoids a significant up-front streaming video A one-way video transmission over a data network. It is widely used on the Web as well as company networks to play video clips and video broadcasts. Computers in home networks stream video to digital media hubs connected to a home theater. sites about the entertainment industry; EXBTV.com, a producer and netcaster of original Internet programming covering the executive branch of government; istyletv.com, a premier video driven lifestyle website; TV onthe WEB.com, a leading provider of webcasting services; and TV1 Internet Television Internet television (or Internet TV) is television distributed via the Internet. Overview In the past, television was only distributed by cable, satellite, or terrestrial systems. , one of Europe's top webcasters. In addition, iNEXTV operates the Internet Technology Group to develop enhanced technology for Internet video. Ampex's two other wholly-owned subsidiaries, MicroNet Technology, Inc. and Ampex Data Systems Corporation, provide high-performance digital storage solutions for industry, entertainment and government applications. This news release contains 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 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 that involve risks and uncertainties and unforeseen circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or that could cause actual results to differ materially from those currently anticipated. Potential risks and uncertainties include, without limitation, risks of continuing losses from future operations, risks affecting the Company's Internet strategy, uncertainty as to the timing or terms of any sale of Data Systems and other risks mentioned in the Company's 1999 Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. filed with the SEC and its Quarterly Report on Form 10-Q Form 10-Q See 10-Q. for the fiscal quarter ended March 31, 2000 which is expected to be filed shortly.
AMPEX CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
(unaudited)
March 31, December 31,
2000 1999
------------- ------------
ASSETS
Current assets:
Cash and cash equivalents $ 14,392 $ 10,598
Short-term investments 18,709 31,067
Accounts receivable
(net of allowances of
$274 in 2000 and $358
in 1999) 1,665 1,236
Inventories 2,089 2,261
Other current assets 1,522 4,951
------------- ------------
Total current assets 38,377 50,113
Property, plant and equipment 6,336 5,363
Intangible assets, net 8,928 9,806
Investment in
unconsolidated companies 1,786 1,786
Deferred pension asset 6,777 5,571
Other assets 1,508 1,620
Net assets of business
held for disposition 16,053 13,060
------------- ------------
Total assets $ 79,765 $ 87,319
LIABILITIES, REDEEMABLE PREFERRED STOCK AND
STOCKHOLDERS' DEFICIT
Current liabilities:
Notes payable $ 898 $ 1,103
Accounts payable 2,347 2,569
Accrued restructuring costs 57 67
Other accrued liabilities 7,849 7,913
------------- ------------
Total current liabilities 11,151 11,652
Long-term debt 43,870 43,914
Other liabilities 21,423 21,634
Deferred income taxes 1,213 1,213
------------- ------------
Total liabilities 77,657 78,413
------------- ------------
Commitments and contingencies
Mandatorily redeemable
junior preferred stock -- --
Mandatorily redeemable nonconvertible
preferred stock, $1,000
liquidation value:
Authorized: 69,970 shares
in 2000 and in 1999
Issued and outstanding -
none in 2000 and in 1999 -- --
Mandatorily redeemable preferred
stock, $2,000
liquidation value:
Authorized: 21,859 shares
in 2000 and in 1999
Issued and outstanding - 18,784
shares in 2000; 19,321 in 1999 37,568 38,642
Convertible preferred stock,
$2,000 liquidation value:
Authorized: 10,000 shares
in 2000 and in 1999
Issued and outstanding - 1,125
shares in 2000; 1,885 in 1999 2,250 3,770
Stockholders' deficit:
Preferred stock, $1.00
par value:
Authorized: 898,171 shares
in 2000 and in 1999
Issued and outstanding - none
in 2000 and in 1999 -- --
Common stock, $.01 par value:
Class A:
Authorized:
175,000,000 shares in
2000 and in 1999
Issued and outstanding -
56,616,572 shares in 2000;
55,941,854 in 1999 566 559
Class C:
Authorized: 50,000,000
shares in 2000 and in 1999
Issued and outstanding -
none in 2000 and in 1999 -- --
Other additional capital 418,059 415,437
Notes receivable from
stockholders (4,642) (4,642)
Accumulated deficit (451,714) (445,001)
Accumulated other
comprehensive income 21 141
------------- ------------
Total stockholders'
deficit (37,710) (33,506)
------------- ------------
Total liabilities, redeemable
preferred stock and
stockholders' deficit $ 79,765 $ 87,319
AMPEX CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(in thousands, except share and per share data)
(Unaudited)
For the three months ended
March 31,
2000 1999
Royalty income $ 3,119 $ 2,662
Internet revenue 575 --
Product sales 3,261 2,825
------------ ------------
Total revenue 6,955 5,487
------------ ------------
Intellectual property costs 370 377
Internet video programming
and site development 3,249 --
Cost of product sales 2,255 2,592
Research, development and
engineering 444 184
Selling and administrative 5,794 2,231
Amortization of goodwill 877 303
------------ ------------
Total costs and
operating expenses 12,989 5,687
------------ ------------
Operating loss (6,034) (200)
Interest expense 1,364 1,352
Amortization of debt
financing costs 88 86
Interest income (547) (739)
Other (income) expense, net (1) (2)
------------ ------------
Loss from continuing
operations before income taxes (6,938) (897)
Provision for income taxes 323 260
------------ ------------
Loss from continuing operations (7,261) (1,157)
Income (loss) of business
held for disposition (net of taxes
of none in 2000 and 1999) 548 (790)
------------ ------------
Net loss available for
common stockholders (6,713) (1,947)
Other comprehensive
loss, net of tax:
Unrealized gain (loss) on
marketable securities (130) 199
Foreign currency
translation adjustments 10 --
------------ ------------
Comprehensive loss $ (6,833) $ (1,748)
============ ============
Basic and diluted income (loss)
per share :
Loss per share from
continuing operations $ (0.13) $ (0.02)
Income (loss) per share
from discontinued operations $ 0.01 $ (0.02)
Loss per share available
to common stockholders $ (0.12) $ (0.04)
------------ ------------
Weighted average number
of common shares outstanding 55,518,445 50,618,092
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