BroadBand Technologies, Inc. Reports Financial Results for the Second Quarter 1997.RESEARCH TRIANGLE PARK Research Triangle Park, research, business, medical, and educational complex situated in central North Carolina. It has an area of 6,900 acres (2,795 hectares) and is 8 × 2 mi (13 × 3 km) in size. Named for the triangle formed by Duke Univ. , N.C.--(BUSINESS WIRE)--July 24, 1997--BroadBand Technologies 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 :BBTK) the leading provider of interactive switched digital broadband systems, today reported results for the second quarter ending June 30, 1997. 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 for the quarter were $5.2 million, a decrease of $.3 million from the $5.5 million recorded for the same period in 1996. The company reported a net loss for the quarter of $8.8 million or $.66 per share, compared with a net loss of $6.5 million or $.49 per share, for the same quarter in 1996. The company ended the quarter with a strong balance sheet, with cash and investments of approximately $141 million. The company's results and outlook continue to reflect the slow implementation of the Telecom Reform Act, merger activity among several of the company's major customers, the long evaluation and implementation process that is typical of major communications infrastructure changes, as well as the company's investment in the current generation product and market development of the FLX FLX Finger Lakes (New York) FLX Fort Lauderdale Executive (airport code) FLX Federal Learning eXchange FLX Flatfishes (R)-2500 platform. Results also reflect the impact of higher net interest expense and the expenses associated with the $115 million convertible bond offering in May, 1996. "As the leader in switched digital broadband technology broadband technology Telecommunications devices, lines, or technologies that allow communication over a wide band of frequencies, and especially over a range of frequencies divided into multiple independent channels for the simultaneous transmission of different signals. , BroadBand Technologies has nonetheless been impacted by conditions directly attributable to today s difficult regulatory environment," said David E. Orr, president and chief executive officer for BroadBand Technologies. "The FCC (1) (Federal Communications Commission, Washington, DC, www.fcc.gov) The U.S. government agency that regulates interstate and international communications including wire, cable, radio, TV and satellite. The FCC was created under the U.S. and the court's conflicting views in resolving the interconnection in·ter·con·nect v. in·ter·con·nect·ed, in·ter·con·nect·ing, in·ter·con·nects v.intr. To be connected with each other: The two buildings interconnect. v.tr. guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. and other factors have significantly delayed investment by incumbent local exchange carriers ILEC, short for incumbent local exchange carrier, is a local telephone company in the United States that was in existence at the time of the break up of AT&T into the Regional Bell Operating Companies (RBOCs) also known as the "Baby Bells". (ILECS) in new and advanced local loop technology like the FLX platform. To date, The Telecom Act has failed to deliver on promises of local service competition, lower prices for network services and expanded access Expanded access refers to the inclusion of patients in a clinical trial for a new therapeutic treatment or chemical entity, where those patients would not satisfy the enrolment criteria for the scientific study in progress. to advanced networks providing voice, data and video services." FLX Makes Progress In CLEC (Competitive Local Exchange Carrier) An organization offering local telephone service that is not one of the traditional telephone companies. The Telecommunications Act of 1996 allowed competition to the incumbent telcos (ILECs), enabling new companies (CLECs) Market During the quarter BroadBand successfully completed a laboratory evaluation with a major competitive local exchange carrier (CLEC) and received its first order from Lucent to supply the FLX platform to the carrier, for deployment in its first city. The FLX platform equips customers with the best-in-class services over a true fiber-to-the-curb full service network. Orr stated, "Despite regulatory delays, CLECs targeting the residential market are realizing that the FLX-2500 provides them with an upgradeable, integrated network A network that supports both data and voice and/or different networking protocols. See converged network and new public network. platform that accelerates their business case by allowing them to provide multiple services over one network, instead of requiring much larger penetration of a single service. Also, it is well known that the bundling of services leads to higher customer retention, a significant advantage for service operators." SBC (1) (SBC Communications Inc., San Antonio, TX, www.sbc.com) A large, national telecommunications company that grew from a multitude of local and regional companies, including Southwestern Bell, Pacific Bell and Nevada Bell, into a single, unified brand by 2002. to Focus on Advanced Telephony and Data Services The company and its partner, Lucent Technologies, continue to go forward with SBC on the Richardson field trial of advanced telephony services. SBC is finding the telephony-first application of the FLX platform attractive, as it has turned up nearly 2,000 customers in its 42,000 customer field trial in Richardson, Texas Richardson is a suburb in Dallas County and Collin County, Texas. As of the 2000 census, the city had a total population of 91,803, while according to a 2006 estimate, the population had grown to 99,200. . SBC's broadband strategy will initially focus on high-speed data in Richardson, as evidenced by their recently announced suspension of video trials attributed to Federal regulatory actions which force SBC to sell its wireline services and network to new competitors at prices below actual cost. "Although we are disappointed that SBC is not pursuing video service in the near term, their decision to go forward with a telephony-first, high-speed data-ready solution, validates the modularity and power of the FLX platform as a long-term solution and provides flexibility to install video in the future," said Salim A. L. Bhatia, chairman of BroadBand Technologies, Inc. "As important, SBC's recent decision to suspend investment in hybrid fiber coax (networking) Hybrid Fiber Coax - (HFC) A kind of physical connection used in networks for audio, video, and data. DVB (Digital Video Broadcast) is used in Europe and DOCSIS is used in N America. solidifies switched digital broadband as the access technology of choice for the telcos." BroadBand and its partner, Lucent Technologies, also continue their efforts at Bell Atlantic to complete laboratory evaluation, prior to service turn-up in Philadelphia. Progress has been slow, as a result of product challenges, complexity of the technology and performance standards set by Bell Atlantic. The implementation of the Lucent/BroadBand access platform has presented product challenges which have delayed the turn-up of telephony services in Philadelphia. The delay will impact near term revenue for BroadBand. Lucent and BroadBand have focused additional resources on telephony product development efforts to provide a cost effective, dependable platform to turn-up initial customers in the Fall, with general turn-up for the first office application coming in late 1997 to early 1998. Far Ranging International Activities Continue BroadBand and its international partner Samsung successfully completed a digital video demonstration in Korea; however, Korea Telecom KT (formerly, Korea Telecom, Korean: 한국통신, NYSE: KT) is South Korea's top integrated wired/wireless telecommunication service provider. KT has been Korea's leader in the development of the information & communications business for the last 25 years elected to use traditional analog technology for its near-term deployment of video. Samsung and BroadBand continue to market the FLX-2500 platform to Korea Telecom for possible full service network deployments in the future. Laboratory evaluations of the FLX platform are proceeding successfully with CSELT/Telecom Italia in Italy and BEZEQ in Israel. Market feasibility trials with TELUS TELUS Telemetric Universal Sensor in Canada and trials with Groupe SAGEM SAGEM Societe d'Applications Generales d'Electricite et de Mecanique continue to progress, positioning the FLX platform as the global core platform for switched digital broadband access See broadband and wireless broadband. . -0- This press release contains forward looking statements, including statements about product development by BroadBand and its partners, future product performance and future decisions of customers and potential customers about the Company's products. The Company'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. , Form 10-Qs Form 10-Q See 10-Q. and other documents on file with the Securities and Exchange Commission identify important factors which could cause actual results to differ materially from those indicated by the forward looking statements. However, forward looking statements are beyond the ability of the Company to control and in many cases the Company cannot predict what factors would cause actual results to differ materially from those indicated by the forward looking statements. BroadBand Technologies Inc., based in Research Triangle Park, N.C., was founded in 1988. Its mission is to deliver products and services that enable network and service providers to offer consumers robust, economical electronic access to advanced communication, entertainment and information services See Information Systems. . For more information on BroadBand Technologies, please see the BroadBand Technologies home page at http://www.bbt.com -0- Note to editors: FLX is a registered trademark of BroadBand Technologies Inc. All other trademarks are registered trademarks of their respective companies.
BROADBAND TECHNOLOGIES, INC.
STATEMENTS OF OPERATIONS
For the periods ended June 30,
1997 and June 30, 1996
3 Months Ended 6 Months Ended
1997 1996 1997 1996
(Unaudited) (Unaudited)
(Dollars in thousands except
per share amounts)
Sales $ 5,233 $ 5,515 $ 10,543 $ 9,512
Cost and Expenses:
Cost of Sales 4,042 5,223 8,339 9,480
Research & Development 7,227 5,095 13,726 10,143
Sales, Marketing and
Administration 3,215 2,315 6,035 5,242
Net Interest Expense 1,619 784 3,224 790
Net Interest Income (2,076) (1,393) (3,525) (2,093)
Pretax (loss) (8,794) (6,509) (17,256) (14,050)
Income Tax Provision -- -- -- --
Net (loss) ($ 8,794) ($ 6,509) ($17,256) ($14,050)
Average Shares &
Equivalents (Thousands) 13,262 13,217 13,253 13,184
(Loss per Share) ($ 0.66) ($ 0.49) ($ 1.30) ($ 1.07)
-0-
BROADBAND TECHNOLOGIES, INC.
BALANCE SHEETS
June 30 1997 Dec. 31 1996
(Unaudited) (Audited)
(Dollars in thousands )
Assets
Current assets:
Cash and investments $140,631 $148,758
Accounts receivable 3,626 6,284
Inventories (net) 2,612 1,533
Other Current Assets 1,012 954
Total current assets 147,881 157,529
Property and plant equipment (net) 11,128 10,545
Long Term Assets 2,899 3,273
$161,908 $171,347
Liabilities and Shareholders' Equity
Current Liabilities:
Accounts Payable and accrued liabilities $ 10,166 $ 10,354
Deposits and other accrued liabilities 3,283 3,258
Other current liabilities 8,677 10,834
Total current liabilities 22,126 24,446
Long Term Debt & Deferred Revenue 128,000 118,000
Total Shareholders' equity 11,782 28,901
$161,908 $171,347
CONTACT: BroadBand Technologies Inc. Copithorne & Bellows bellows, expansible, gas-tight chamber used to pump or store a gas. One of the simplest and most familiar types of bellows is the manual one used for providing a forced draft to a fire. The expansible chamber consists of a leather bag with pleated sides. Timothy Oakley Joann Anderson/Jack Varley (919) 405-4611 (617) 450-4300 oakley@bbt.com jack.varley@cbpr.com |
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