Atrix International Reports 1998 Fiscal Results Company Earns 6 Cents in 4th Quarter.MINNEAPOLIS--(BUSINESS WIRE)--Aug. 18, 1998--Atrix International, Inc. of Burnsville Burns·ville A city of southeastern Minnesota, a suburb of Minneapolis. Population: 60,000. , MN announced today that it earned 6 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. for the 4th quarter ended June June: see month. 30, 1998. All of the 4th quarter profit can be attributed to Other Income resulting from a $176,750 cash settlement that the company reached regarding a breach of contract action filed earlier in the year against its formerly largest customer. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. Steve Riedel, President of Atrix International, "This settlement was reached after several months of negotiations. The settlement reflects in part, loss profits from operations due to inventory and sales expenses relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the contract. In addition, Atrix retains most of the inventory it purchased for the customer contract and will realize additional cash as the inventory is sold." Sales for quarter ended June 30, 1998 were $1,100,088 as compared to $1,412,742 for the same period one year ago. Fiscal 1998 total net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight were $4,199,116 compared to prior fiscal yearsales of $5,801,300. Mr. Riedel further stated, "Most of the sales decrease can be attributed directly to the loss of revenue of approximately $1,600,000 that were expected from the customer against whom the company filed the breach of contract action. In addition, we experienced a 10% sales increase in the last six months of fiscal 1998 as compared to the first six months of the fiscal year." The company reported net income for the fourth quarter of $90,930 compared to a net income of $74,291 in the same quarter last year. For the year ended June 30, 1998, the company reported a net loss of $62,970 compared to a net profit of $200,870 in the prior fiscal year. The loss from operations for the fourth quarter totaled $39,676 versus 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 $56,753 one year ago. For the twelve months ended June 30, 1998, the operating loss incurred was $211,104 as compared to an income from operations of $57,813 in the prior fiscal year. Mr. Riedel went on to further state, "1998 was a difficult year for us. We entered it with the full expectations that our relationship with our largest customer was on solid ground. Consequently, we expected sales to continue so we built a business plan that was based on growth. Investments were made in sales manpower, production equipment, and technology. This can best be illustrated by the announcement we made last week, that the Patent and Trademark office informed us that a patent will be issued for our Multipurpose mul·ti·pur·pose adj. Designed or used for several purposes: a multipurpose room; multipurpose software. multipurpose Adjective Metering System for the plastics injection/blow molding industry." He continued, "Whenever a company loses over 25% of its annual sales it becomes a significant management issue. Customers, employees, shareholders, vendors, and the financial community become concerned. To weather this, we evaluated the options and took the appropriate actions to manage expenses without harming our ability to grow in the years to come. We were able to keep our key people in place to develop new products and market opportunities while reducing operating expense Operating Expense The essential things that a company must purchase in order to maintain business. Notes: For example, the payment of employees wages are an operating expense. Also known as OPEX. for the year, by over $50,000. In addition, we increased our gross margins on manufactured products by 2 percentage points, adding another $48,000 to the bottom line." In summary Mr. Riedel stated, "I think we did an excellent job in managing the hand we were dealt in fiscal 1998. Losses were kept to a minimum, inventory was reduced, cash was managed well, our balance sheet is strong, and sales are on the upswing Upswing An upward turn in a security's price after a period of falling prices. . Today we have more prospects for the Copy Management System than ever before. Additionally, we hired a new sales person in February to lead the sales and installation effort for the newly released A-Trax Production Monitoring System. Overall, we are better positioned today than ever before and I am very proud of the effort from our employee team in fiscal 1998." Expect for the historical information contained herein, the disclosures in this Press Release are 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. which could be affected by certain risks and uncertainty, including the Company's ability to increase sales in future periods, the Company's ability to sell existing inventory that had been purchased for a former customer, and the Company's ability to generate meaningful sales of its Copy Management System and it's A-Trax Production Monitoring System. Atrix is a leading edge manufacturer of remote metering and production monitoring hardware for the copy control and plastic injection molding injection molding n. A manufacturing process for forming objects, as of plastic or metal, by heating the molding material to a fluid state and injecting it into a mold. industries. The Company develops and writes proprietary monitoring software for these same industries. In addition, Atrix manufactures industrial vacuums, vacuum filters and printed circuit board transport cases for the office machine/computer industries. The Company also offers numerous innovative programs for supplying tools and instrumentation instrumentation, in music: see orchestra and orchestration. instrumentation In technology, the development and use of precise measuring, analysis, and control equipment. for field service organizations throughout the world. The common stock of Atrix is traded on 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 under the symbol ATXI. Atrix International E-Mail International E-mail (IDN E-mail or Intl E-mail) is E-mail that contains international, UTF-8 encoded, characters (characters which do not exist in the ASCII character set) in the e-mail header. : SRiedel@Atrix.com 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 :www.Atrix.com -0-
Atrix International, Inc.
Statement of Operations
Three Months Ended Twelve Months Ended
June 30, June 30,
1998 1997 1998 1997
Net Sales $1,100,088 $1,412,742 $4,199,116 $5,801,300
Cost of Sales (742,206) (1,046,371) (2,838,947)($4,100,727)
Gross Profit 357,882 366,371 1,360,169 1,700,573
Selling, general and
administrative expenses (397,558) (423,124) (1,571,273)($1,642,760)
Income/(loss) from
Operations (39,676) (56,753) (211,104) 57,813
Other Income(expense) net 130,828 7,045 152,121 18,540
Income/(loss) before Taxes 91,152 (49,708) (58,983) 76,353
Income (taxes)/Benefit 222 123,999 (3,987) 124,517
Net Income/(loss) $90,930 $74,291 ($62,970) $200,870
Net Earnings/(loss)
per share - Basic
and Diluted $0.06 $0.05 ($0.04) $0.14
Weighted average number
of common shares
outstanding 1,413,449 1,413,449 1,413,449 1,413,449
CONTACT: Atrix International Inc., Minneapolis
Steven D. Riedel, 612/894-6154
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