Applied Microsystems Reports Third Quarter 2002 Results.Business Editors REDMOND Redmond, city (1990 pop. 35,800), King co., W Wash., a suburb of Seattle, on Lake Sammamish; inc. 1912. Its economy centers around computer software (Microsoft Corp. , Wash.--(BUSINESS WIRE)--Nov. 6, 2002 Applied Microsystems Corporation (Nasdaq:APMC APMC Application (Server) for Mail and Calendaring APMC Asia-Pacific Microwave Conference APMC Advanced Program Management Course APMC Amicale Philatélique et Marcophile Colmarienne APMC Afloat Personnel Management Center ) today reported revenues of $2.8 million in the third quarter ended Sept. 30, 2002, compared to $4.6 million in the third quarter a year ago. The Company's net loss in the third quarter of 2002 was $1.0 million, compared to a net loss of $4.0 million in the third quarter of 2001. The third quarter of 2001 results included restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. of $2.3 million. As was previously reported, Applied has completed the sale of its embedded systems Embedded systems Computer systems that cannot be programmed by the user because they are preprogrammed for a specific task and are buried within the equipment they serve. development tools assets and business to Metrowerks Metrowerks was a company that developed software development tools for various embedded, game, handheld, and desktop platforms. Its flagship product, CodeWarrior, comprised an IDE, compilers, linkers, libraries, and related tools. Corporation, a subsidiary of Motorola (Motorola, Inc., Schaumburg, IL, www.motorola.com) A leading manufacturer of semiconductor devices, electronics, telecommunications and satellite systems. Founded in Chicago in 1928 by Paul V. , Inc. In accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with the terms of the transaction, the purchase price was $3.9 million, which included payment for certain inventories and tangible assets Tangible Asset An asset that has a physical form such as machinery, buildings and land. Notes: This is the opposite of an intangible asset such as a patent or trademark. Whether an asset is tangible or intangible isn't inherently good or bad. as well as all intellectual property related to Applied's embedded systems development tools business. In addition, Metrowerks assumed certain customer warranty and support obligations, and offered employment to 26 Applied personnel. Applied received $3.4 million at closing, with the remaining $500,000 held back for one year to secure certain indemnification Indemnification Used in insurance policy agreements as to compensation for damage or loss. In the context of corporate governance, Director Indemnification uses the bylaws and/or charter to indemnify officers and directors from certain legal expenses and judgements resulting from obligations. "With the asset sale accomplished, combined with the previously disclosed headquarters lease termination by which we paid $1 million to eliminate a forward lease obligation in excess of $6 million, we believe our Libra Libra (lē`brə, lī`–) [Lat.,=the scales], southern constellation lying on the ecliptic (the sun's apparent path through the heavens) between Virgo and Scorpius; it is one of the constellations of the zodiac. Networks options have expanded," stated Stephen Stephen, 1097?–1154, king of England (1135–54). The son of Stephen, count of Blois and Chartres, and Adela, daughter of William I of England, he was brought up by his uncle, Henry I of England, who presented him with estates in England and France and J. Verleye, president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Applied. "We embrace the challenges of this new effort -- we are encouraged by our product development efforts, and continue to pursue additional financing for the new Libra business." Excluding personnel in a transition role associated with the asset sale, Applied employs approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 25 personnel who will be engaged solely in pursuit of the Libra Networks business. As has been previously disclosed, the Libra Networks business requires additional funding in the first half of 2003. About Applied Microsystems Applied has historically been a developer of tools for use by embedded systems developers. Applied's Libra Networks division represents an expansion into development of hardware and software products aimed at end-user (job) end-user - The person who uses a computer application, as opposed to those who developed or support it. The end-user may or may not know anything about computers, how they work, or what to do if something goes wrong. markets -- specifically, corporate data centers. The company can be reached at P.O. Box 97002, Redmond, Wash. 98073-9702; by phone at 800/426-3925; or by e-mail at info@amc.com. Visit Applied on the Web at www.amc.com. 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. in this press release are made pursuant to the 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. provisions 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. These forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated or stated or implied by such forward-looking statements. These factors include, without limitation, the ability of the Company to produce and grow revenues through its Libra Networks business, availability of needed capital resources, achievement of product development objectives, market acceptance for planned products and services, sufficient availability and retention of qualified personnel, development of distribution channels, protection of the Company's intellectual property, availability of required components from suppliers, the overall economic climate of the businesses and geographies in which the Company operates, and other risks and uncertainties detailed in the Company's filings with the Securities and Exchange Commission.
Condensed Consolidated Statements of Operations
(in thousands, except per-share data)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------- -------------------
2002 2001 2002 2001
--------- --------- --------- ---------
Net sales $2,781 $4,605 $10,917 $23,559
Cost of sales 908 1,181 3,644 6,504
--------- --------- --------- ---------
Gross profit 1,873 3,424 7,273 17,055
Operating expenses:
Sales, general and
administrative 1,657 2,971 6,729 10,859
Research and development 1,249 2,182 4,488 8,741
--------- --------- --------- ---------
2,906 5,153 11,217 19,600
--------- --------- --------- ---------
Operating loss before in-
process research and
development and restructuring
expenses (1,033) (1,729) (3,944) (2,545)
In-process research and
development -- -- (621) --
Restructuring expenses -- (2,289) (1,149) (2,289)
--------- --------- --------- ---------
Loss from operations (1,033) (4,018) (5,714) (4,834)
Interest income and other, net (12) 50 34 234
--------- --------- --------- ---------
Net loss $(1,045) $(3,968) $(5,680) $(4,600)
========= ========= ========= =========
Basic and diluted net loss per
share $(0.14) $(0.56) $(0.77) $(0.65)
========= ========= ========= =========
Shares used in per-share
calculation 7,553 7,113 7,355 7,053
Condensed Consolidated Balance Sheets
(in thousands)
Sept. 30 Dec. 31
2002 2001
--------- --------
Assets:
Cash, cash equivalents, and investment $2,537 $7,368
Net accounts receivable 1,940 3,594
Inventories 1,614 1,959
Other assets 2,206 2,103
--------- --------
Total assets $8,297 $15,024
========= ========
Liabilities and shareholders' equity:
Total liabilities $7,005 $8,482
Shareholders' equity 1,292 6,542
--------- --------
Total liabilities and shareholders' equity $8,297 $15,024
========= ========
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