ChatCom, Inc. Announces Results for the Second Quarter.CHATSWORTH, Calif.--(BUSINESS WIRE)--November 15, 1996--ChatCom, 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 : CHAT), announced today that the Company recorded a net loss of $1,088,138 or $0.13 per share, on revenues of $2,208,896 for the fiscal quarter ended September 30, 1996 as compared to a net loss of $606,529, or $0.08 per share, on revenues of $3,716,988 for the fiscal quarter ended September 30, 1995. The Company reported that the loss was mostly attributable to the decrease in revenues that the company believes was due at least in part to the decreased sales and marketing efforts from October 1995 through March 1996. The decreased sales and marketing efforts were necessitated by liquidity constraints which were alleviated with the successful completion of private placements of preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. in March and May of 1996. The Company also reported that the loss included approximately $120,000 in additions to inventory reserves for obsolescence ob·so·les·cent adj. 1. Being in the process of passing out of use or usefulness; becoming obsolete. 2. Biology Gradually disappearing; imperfectly or only slightly developed. relating in part to the continuing process of reorienting the Company's products toward additional markets. The loss also included approximately $100,000 in bad debt expense relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc a receivable due from a reseller that is experiencing financial difficulties. James B. Mariner, President and Chief Executive Officer of ChatCom, Inc. stated, "The Company is continuing its strategy to develop the network server, internet server and network simulation In computer network research, network simulation is a technique where a program models the behavior of a network either by calculating the interaction between the different network entities (hosts/routers, data links, packets, etc) using mathematical formulas, or actually capturing markets. The marketing team that the Company has assembled appears to be making significant inroads inroads Noun, pl make inroads into to start affecting or reducing: my gambling has made great inroads into my savings inroads npl to make inroads into [+ into these markets. Company sales and operations are beginning to realize some of the benefits from the renewed marketing efforts for the coming quarters." "Over the last six months, we have been able to achieve significant operating efficiencies and major refocus of our marketing effort. Our product and financial accomplishments have received notice in the prestigious network publication, Communications Week and in the financial markets by receiving our first research coverage." 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. Statement under 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 Except for the historical information contained herein, the matters discussed in this Press Release are forward-looking statements which involve risks and uncertainties, including but not limited to economic, competitive, governmental, and technological factors affecting the Company's various filings with the Securities and Exchange Commission, including without limitation the Current Report on Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. , dated August 29, 1996, and the Registration Statement on Form S-3 (Registration No. 333-3792), which was declared effective by the Securities and Exchange Commission on June 7, 1996. Founded in 1982, ChatCom, Inc. is a leading supplier of consolidated server systems to Fortune 1000 companies. Its ChatterBox(TM) family of products has won numerous prestigious awards, including: PC Magazine's `Editor's Choice', LAN (Local Area Network) A communications network that serves users within a confined geographical area. The "clients" are the user's workstations typically running Windows, although Mac and Linux clients are also used. Magazine's `Product of the Year', and the LAN Times `Best of Times'. -0-
Three Months Ended Six Months Ended
September 30, September 30,
1996 1995 1996 1995
Revenue $ 2,208,896 $ 3,716,988 $ 4,893,212 $ 8,200,644
Net Loss $(1,088,138) $ (606,529) $(1,718,219) $ (482,619)
Loss Per Share $ (0.13) $ (0.08) $ (0.21) $ (0.06)
CONTACTS: James B. Mariner CHATCOM, INC. 818-709-1778 or Richard Cooper\Stanley Altschuler STRATEGIC GROWTH INTERNATIONAL, INC. 516-829-7111 |
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