Bogen Communications International Reports 1999 Fourth Quarter/Year End Results.Business Editors RAMSEY Ramsey, residential borough (1990 pop. 13,228), Bergen co., NE N.J.; settled 1846, inc. 1908. Dairy and truck farms are in the area. , N.J.--(BUSINESS WIRE)--March 30, 2000 Bogen Communications International, Inc., (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 :BOGN) ("Bogen") today announced results for its fourth quarter and year ended December 31, 1999. Sales and Growth Fourth quarter 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 rose 27% to $16,159,000 from $12,717,000 in the fourth quarter of 1998. For the year, sales increased 12.3% to $58,487,000 from 1998 sales of $52,103,000. This year's double-digit revenue increase far surpasses the growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. ever recorded by Bogen in its recent history as a publicly traded company publicly traded company A company whose shares of common stock are held by the public and are available for purchase by investors. The shares of publicly traded firms are bought and sold on the organized exchanges or in the over-the-counter market. . Gross Margin Gross margin increased to 49.9% in the final quarter of 1999, up from 47.7% for the fourth quarter of 1998. For the year as a whole, the gross margin was 51.4%, up from 48.8% in 1998. Gross margin expansion for the quarter and year was due to lower product costs, improved sales mix sales mix See product mix. , selective price increases, and was achieved despite the late August acquisition of the assets of Apogee apogee (ăp`əjē), point farthest from the earth in the orbit of a body about the earth. See apsis. The farthest point. Sound, Inc., which has lower margins than Bogen as a whole. Net Income Net income for the fourth quarter of 1999 was $316,000, or $.04 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 as compared to 1998's $222,000, or $.03 per diluted share. Net income for the year 1999 was $3,500,000, or $.45 per diluted share. Including one-time charges, Bogen reported a net loss of $558,000, or $.12 per diluted share for 1998. One consequence of 1999's profitability is that for the first time in Bogen's history as a public company its Balance Sheet shows Retained Earnings Retained Earnings The percentage of net earnings not paid out in dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders equity on the balance sheet. instead of an Accumulated ac·cu·mu·late v. ac·cu·mu·lat·ed, ac·cu·mu·lat·ing, ac·cu·mu·lates v.tr. To gather or pile up; amass. See Synonyms at gather. v.intr. To mount up; increase. Deficit. Comments by Jonathan Guss and Michael P. Fleischer Jonathan Guss, Bogen's 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. , stated, "This has been a satisfying and a good year for Bogen. Our two distinct businesses, one based in Europe and the other in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , have both made substantial progress on the separate paths set out for them by management and approved by Bogen's Board of Directors. "In Europe, Bogen's wholly-owned Speech Design subsidiary participates in a fast-moving, technology-oriented marketplace. Our strategy in Europe focuses on two attractive markets. The first is the advanced telephony Meaning "sound over distance," it refers to electronically transmitting the human voice. In the beginning, telephony dealt only with analog signals in the circuit-switched networks of the telephone companies. and voicemail market that we serve through products like our new Teleserver Pro. Voicemail penetration in Europe lags far behind that reached in the U.S. and this creates a rapidly growing market that Speech Design is well positioned to exploit. Our outstanding relationships with Europe's Telecom leaders, such as Deutsche Telekom Deutsche Telekom AG (ISIN: DE0005557508, FWB: DTE, NYSE: DT, LSE: DEU, TYO: 9496 ) (abbreviated DTAG) is a telecommunications company headquartered in Bonn, Germany. It is the largest telecommunications company in Germany and in the EU. with whom we announced a major new agreement in 1999, give us access to both the new installation and the aftermarket Aftermarket See: Secondary market. aftermarket See secondary market. conversion segments of the marketplace. "The second is the Unified Messaging Having access to e-mail, voice mail and faxes via a common computer application or by telephone. For example, unified messaging may send faxes and digitized voice mail to a mail server that turns them into e-mail attachments. market, which we serve through our Thor(TM) product. This advanced software offers important capabilities valued by Internet Service Providers Internet service provider (ISP) Company that provides Internet connections and services to individuals and organizations. For a monthly fee, ISPs provide computer users with a connection to their site (see data transmission), as well as a log-in name and password. (ISPs), Telcos, and individual users. Our market-tested and scaleable product, Thor, with its large user base, including ISPs like AOL-Germany, freenet.de, and 1&1, is the established leader in the European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. Unified Messaging market. "To fully capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. the opportunities we see in the attractive European market, as well as in the U.S., our 1999 plan called for aggressive investments in both marketing and product development. Thus, ongoing operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. rose by approximately $6 million from 1998 to 1999. Almost 60% of this increase was incurred by Speech Design as part of its expansion strategy. The freenet.de, 1&1, and Deutsche Telekom announcements plainly show that the strategy is working." Addressing the U.S. market, Bogen's President, Michael P. Fleischer, stated, "Our U.S. strategy is focused on reinvigorating Bogen's top line through a combination of internally generated growth and acquisitions. "The announcement that we have been selected as Lucent's preferred provider of Overhead Paging products is the most compelling indicator of our success in accelerating the organic growth of the U.S. business. The strengths that distinguished us to Lucent, especially those of customer service and product development, are also helping us speed up growth across all of our domestic markets. The 1999 results demonstrate that acceleration and we expect the trend to continue through 2000. "This year we acquired Apogee Sound, giving us a foothold foot·hold n. 1. A place providing support for the foot in climbing or standing. 2. A firm or secure position that provides a base for further advancement. foothold Noun 1. in Pro Sound, a market closely related to our Commercial Audio business. We believe that Apogee will be accretive to Bogen's earnings as planned during the second half of 2000 and will serve as a platform for future growth. Consistent with our strategy, we continue to look for other potential acquisitions." Mr. Fleischer also noted that Yoav M. Cohen cohen or kohen (Hebrew: “priest”) Jewish priest descended from Zadok (a descendant of Aaron), priest at the First Temple of Jerusalem. The biblical priesthood was hereditary and male. , Senior Vice President and Chief Financial Officer of Bogen has voluntarily tendered his resignation to accept a position with a venture capital firm. Mr. Fleischer stated, "We thank Yoav Cohen for four years of hard work and support, and we appreciate that he has timed his departure until after the year end audit was finalized See finalization. . We have launched both an internal and external search process to help us fill the permanent CFO See Chief Financial Officer. position. All of us at Bogen wish Yoav Cohen the very best in his new position." Bogen Communications International, Inc., based in Ramsey, New Jersey Ramsey is a borough in Bergen County, New Jersey, United States. As of the United States 2000 Census, the borough population was 14,351. Ramsey was incorporated as a borough by an Act of the New Jersey Legislature on March 10, 1908, from portions of Hohokus Township (now and Munich, Germany, develops, manufactures, and markets telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. peripherals, sound processing equipment, and unified messaging products and services. Bogen's products are sold to commercial, industrial, professional and institutional customers worldwide. Except for historical information contained herein, the statements made in this release constitute 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. that involve certain risks and uncertainties. Certain factors may cause actual results to differ materially from those contained in the forward-looking statements, including general market conditions, changes in customers' operations or business strategy, new technological developments, Bogen's ability to develop or acquire new or improved products and/or modify and upgrade its existing products and other risks detailed from time to time in Bogen's reports on file at the Securities and Exchange Commission, including Bogen's 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. for the fiscal year ended December 31, 1998 and Bogen's Form 10-Q Form 10-Q See 10-Q. for the fiscal quarters ended March 31, 1999, June 30, 1999 and September 30, 1999. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
BOGEN COMMUNICATIONS INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands of Dollars, Except Share and Per Share Amounts)
Three Months Ended Twelve Months Ended
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
1999 1998 1999 1998
---------- ---------- ---------- ----------
Net sales $ 16,159 $ 12,717 $ 58,487 $ 52,103
Cost of goods sold 8,101 6,647 28,394 26,658
---------- ---------- ---------- ----------
Gross profit 8,058 6,070 30,093 25,445
Operating expenses:
Research and
development 1,323 874 4,419 2,935
Purchased in-process
research and
development 980 3,885
Selling, general
and administrative 5,996 3,502 19,602 15,283
Amortization of
goodwill and
intangible assets 321 193 866 612
---------- ---------- ---------- ----------
Income from operations 418 521 5,206 2,730
Other (income) expenses:
Interest expense,
net 82 74 208 275
Minority interest
of consolidated
subsidiaries - 254
Other (income)
expense 66 82 61 (50)
---------- ---------- ---------- ----------
Income before
provision for income
taxes 270 365 4,937 2,251
Provision for income
taxes (46) 143 1,437 1,909
---------- ---------- ---------- ----------
Net income 316 222 3,500 342
Preferred dividends - - - 900
---------- ---------- ---------- ----------
Net income (loss)
available to common
shareholders $ 316 $ 222 $ 3,500 $ (558)
========== ========== ========== ==========
Basic net income
(loss) per common
share $ 0.05 $ 0.03 $ 0.52 $ (0.12)
========== ========== ========== ==========
Diluted net income
(loss) per common
share $ 0.04 $ 0.03 $ 0.45 $ (0.12)
========== ========== ========== ==========
Weighted average
number of common
shares outstanding -
Basic 6,717,324 6,654,468 6,697,530 4,502,547
========== ========== ========== ==========
Weighted average
number of common
shares outstanding -
Diluted 7,661,675 7,121,179 7,737,921 4,502,547
========== ========== ========== ==========
BOGEN COMMUNICATIONS INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF DECEMBER 31, 1999 and 1998 (In Thousands of
Dollars, Except Share and Per Share Amounts)
1999 1998
---------- ----------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 792 $ 1,048
Accounts receivable (less allowance
for doubtful amounts of $650 and
$424 at December 31, 1999 and 1998,
respectively) 8,455 5,889
Inventories, net 9,310 8,229
Prepaid expenses and other current
assets 658 759
Deferred income taxes 882 470
---------- ----------
TOTAL CURRENT ASSETS 20,097 16,395
Property, equipment, and leasehold
improvements, net 3,837 2,414
Goodwill and intangible assets, net 19,730 18,740
Other assets 214 198
---------- ----------
TOTAL ASSETS $ 43,878 $ 37,747
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Amounts outstanding under revolving
credit agreement $ 2,339 $ 2,225
Current maturities of long-term debt 224 -
Accounts payable 4,199 2,060
Accrued expenses 3,167 3,634
Income taxes payable 1,431 1,168
---------- ----------
TOTAL CURRENT LIABILITIES 11,360 9,087
Bank notes payable - -
Advances and notes payable to related
parties 194 227
Deferred income taxes 1,024 1,100
Long-term debt 505 -
Other liabilities - 278
---------- ----------
TOTAL LIABILITIES 13,083 10,692
---------- ----------
STOCKHOLDERS' EQUITY
Preferred stock - $.001 par value;
1,000,000 shares authorized; none
issued and outstanding at December
31, 1999 and 1998 - -
Common stock - $.001 par value;
50,000,000 shares authorized;
6,784,121 and 6,654,471 shares
issued and outstanding at December
31, 1999 and 1998, respectively 7 7
Additional paid-in-capital 30,093 29,433
Retained earnings (accumulated deficit) 1,252 (2,248)
Accumulated other comprehensive loss (557) (137)
---------- ----------
TOTAL STOCKHOLDERS' EQUITY 30,795 27,055
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $ 43,878 $ 37,747
---------- ----------
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