Applied Cellular Technology Inc. Acquires 80% of U.K. Based Signal Processors Ltd.

NIXA, Mo.--(BUSINESS WIRE)--Aug. 7, 1997--

Acquisition is Expected to Add Approximately $7 to $9 Million

in Revenues and Over $750,000 in Earnings During the Next

Twelve Months; Management Expects Signal Processors to

Grow to $40 Million in Sales Over the Next 3 Years

Applied Cellular Technology Inc. (NASDAQ: ACTC) announced today that it has acquired 80% of Signal Processors Ltd., a leading UK manufacturer of satellite communications equipment.

The company holds over twelve patents for its core technology and is based at the Cambridge Science Park in England. The acquisition will have an effective accounting date of May 1, 1997, and is expected to add approximately $7 to $9 million in revenues and $750,000 in earnings over the coming year.

"The acquisition of Signal Processors offers Applied Cellular many opportunities around the world as the telecommunication industry, global companies and governments turn towards wireless communications. It is consistent with Applied's goal of becoming an application service solution provider to the wireless industry," stated Richard J. Sullivan, the CEO of Applied Cellular Technology Inc. "Signal Processors has over 12 patents in satellite modem and related technology for high capacity (broadband) communication links. We feel confident that by integrating some of Applied Cellular's proprietary wireless technology we can expand the products and services which Signal Processors offers to a larger client base and in turn create a $40 million a year subsidiary within the next three years."

Founded in 1982, Signal Processors designs, manufactures and supports products used in high capacity broadband data links. The company's products are key building blocks for the satellite segment of the global information superhighway, enabling low cost multimedia data distribution and fast Internet Access. This part of the superhighway is now set for very rapid growth as a result of a number of recent major initiatives, including the establishment of European Satellite Multimedia Services for high speed distribution of multimedia data and the recent FCC approval and Boeing investment alongside Craig McCaw and Bill Gates in Teledesic's global packet switched LEO/MEO satellite network for broadband data.

The company's core products are satellite modems and satellite tracking systems. Modems are key items in all satellite data terminals since they implement the basic translation of the digital signals into radio signals and vice versa.

The demand for broadband data distribution by all methods is forecasted to rapidly expand, driven by the explosion of the number of PCs with MMX (multimedia) capability and the need for fast downloading of large digital files. For example, 40m multimedia-capable PCs are expected to be sold in Europe over the next ten years. Many will want multimedia reception capability and this can be provided economically by broadband satellite data receivers. This growth in the market will be accelerated by the establishment of ESM (European Satellites Multimedia Services) to handle such traffic. This market offers a great deal of potential for Signal Processors Ltd., whose PC card satellite demodulators are already installed in PCs and provide the backbone of operational multimedia distribution networks in Europe.

Because of its advanced modem technology, Signal Processors is now the largest manufacturer of satellite modems and data broadcast receivers in Europe. SPL modems have low hardware complexity, low power consumption and high reliability as a result of design techniques which are well protected by patents. The product family includes 19-inch rack mounting modems as well as a broad range of PC card modulators and demodulators for one way and two way VSAT systems, including the only currently available Inteisat-compliant PC units, L-band demodulators, fast acquisition modems for VSAT access channels and L-band modems for Telephony VSAT's and related applications.

Signal Processors' INTRAC antenna controllers provide unshakeable tracking of inclined orbit satellites and are used in more than 45 countries around the world. SPL manufactures a complete range of units for controlling antennas of all sizes from small VSAT antennas to large earth station antennas over 100 feet in diameter. Use of SPL's antenna controllers allows appropriate VSAT networks to use lower cost satellites and so delivers on-going savings in network operating costs.

SPL's strong satellite modem and antenna control technologies mean that SPL is well positioned to supply the high data rate Earth terminals for the Teledesic switched broadband satellite data distribution system which is now being developed.

Signal Processors Ltd. is an ISO9001 approved organization that builds equipment to minimize the cost of owning and operating one way and two way VSAT satellite communications networks. The company's products are highly reliable, which help to keep repair and holding costs at a minimum. Special features, such as unshakeable tracking, help to minimize operating costs and therefore make SPL's products preferred by many end-users. Satellite communications is a truly global market and Signal Processors Ltd. has positioned itself with many blue chip customers around the world. In addition to many of the major system integration companies, these customers include AT&T, British Telecom, NTL Telecommunications, Bosch Telecom, Singapore Telecom, Videsh Sanchar Nigam Ltd. (India) and Teleglobe Canada.

Applied Cellular has grown from $2.2 million in sales and earnings of $.10 per share in 1995 to estimated sales of $95 million with EPS of $.30 for the calendar 1997 year. Applied Cellular Technology, Inc. is a specialty telecommunications and high-technology company whose focus is to capitalize on the industry's move from analog to digital

Statements about the Company's future expectations, including future revenues and earnings, and all other statements in this press release other than historical facts are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and as that term is defined in the Private Securities Litigation Reform Act of 1995. The Company intends that such forward-looking statements be subject to the safe harbors created thereby. Since these statements involve risks and uncertainties and are subject to change at any time, the Company's actual results could differ materially from expected results.

CONTACT: Applied Cellular Technology Inc., Nixa

Matt Hayden or Vince Buczek, 803/272-4653