Aurora Electronics reports fiscal 1996 third-quarter results.

IRVINE, Calif.--(BUSINESS WIRE)--Aug. 14, 1996--Aurora Electronics Inc. (ASE:AUR) Wednesday announced fiscal 1996 third-quarter results.

Net revenues for the three months ended June 30, 1996, were $20.8 million, as compared with fiscal 1995 third-quarter revenues of $31.9 million.

The decrease in revenue was primarily due to the elimination of the Premier Division during fiscal 1995, and a significant shortfall in revenues in the Asset Recovery Services Division due to continued industry-wide declines in semiconductor memory pricing. Net loss after preferred dividends for the three months ended June 30, 1996, was $4.2 million, or 68 cents per share.

This compared with a net loss of $16.5 million, or $1.90 per share, for the same period last year.

Sales for the nine-month period ended June 30, 1996, were $78.9 million compared with $107.3 million. The decline in revenues for the comparable nine-month period is due to the discontinuation of the Premier Division, which accounted for $36.2 million in revenues during the third quarter of fiscal 1995.

Net loss was $11.2 million, decreasing from $15.4 million loss for the same comparable period. Loss per share was $1.50 in 1996, as compared with $1.86 loss per share in the same period in 1995.

Jim C. Cowart, chairman and CEO of Aurora, commented on the quarter: "Despite what has been a difficult quarter due to depressed conditions in the market for recycled computer memory chips, we continue to be confident in the fundamentals and strategy of the company.

"Unit volumes in Asset Recovery have increased significantly and there has been continued improvement in operating efficiency. We believe we are gaining market share in the current environment and it is our goal to continue this trend despite current market conditions.

"We have broadened the range of services to include whole systems recycling, and have been pleased by the response of our customers. We believe this division will return to profitability in the next two quarters with these increased service offerings and a shift in IC recycling mix toward current-generation, 16 megabit DRAMs.

"In the Parts Support Services Division (formerly the Century Division), revenues were essentially flat with the same quarter last year, with weaker results in Europe offset by slightly stronger revenues in the United States and Canada.

"We continue to focus on broadening penetration of key accounts in the computer maintenance market, strengthening our information systems, streamlining operations and reducing costs. Despite adverse operating conditions, net operating cash flows for the company remained positive due to aggressive management of working capital."

With headquarters in Irvine, Aurora Electronics provides computer OEMs and service organizations with spare parts support and electronics recycling necessary for the worldwide installed base. The company has facilities located in the United States, Europe and Canada.

This new release contains certain forward-looking statements that involve risks and uncertainties including pricing for memory chips and computer components described from time to time in the SEC reports filed by the company. -0-

               Aurora Electronics Inc. and Subsidiaries
                 (In thousands, except per-share data)
                             (Unaudited)

                 Consolidated Statement of Operations

                             Three months ended    Nine months ended
                              June 30,   July 2,   June 30,   July 2,
                                1996      1995      1996       1995

Net revenues                 $20,767   $31,865   $78,938   $107,332
Cost of sales                 16,141    25,341    59,010     81,616
Gross profit                   4,626     6,524    19,928     25,716
Selling, general and
  administrative expenses      7,047     7,785    20,491     21,573
Amortization of intangible
  assets                         366     7,857     1,097      8,712
Restructuring charges and
  other                            --    4,699        --      4,699
Operating loss                 (2,787) (13,817)   (1,660)    (9,268)
Interest expense                 (738)  (1,424)   (5,474)    (4,152)
Other income (expense), net        (4)    (728)       (4)      (817)
Loss before provision for
  income taxes                 (3,529) (15,969)   (7,138)   (14,237)
Provision for income taxes        (76)     529     3,373      1,135
Net loss                       (3,453) (16,498)  (10,511)   (15,372)
Dividends on preferred
  stock                          (700)      --      (700)        --
Net loss applicable to
  common stockholders         $(4,153) $(16,498) $(11,211) $(15,372)
Net loss per share of
  common stock                 $(0.68)   $(1.90)   $(1.50)   $(1.86)
Weighted average number
  of common and common
  equivalent shares             6,087     8,686     7,461     8,280
-0-

                 Condensed Consolidated Balance Sheet

                                              June 30,     Sept. 30,
                                                1996         1995

Assets
Cash                                         $    76      $    81
Trade receivables, net                         8,092       15,828
Inventories                                    4,494        4,021
Deferred income taxes                            500        1,532
Other current assets                             940          516
Total current assets                         $14,102      $21,978

Property, plant and equipment, net             5,971        5,752
Intangible and other assets                   49,569       52,986
Total assets                                 $69,642      $80,716

Liabilities and Stockholders' Equity
Total current liabilities                    $15,347      $21,782
Reserve for discontinued operations            2,310        2,504
Long-term debt                                23,681       44,092
Redeemable convertible preferred stock        40,700          --
Common stockholders' equity                  (12,396)      12,338
Total liabilities and equity                 $69,642      $80,716

CONTACT: Aurora Investor Relations, Irvine

714/660-1232