Compositech Ltd. Reports Fourth Quarter/Full Year Results; Announces Financings, Increase in Authorized Shares.HAUPPAUGE, N.Y.--(BUSINESS WIRE)--April 1, 1999--Compositech, Ltd. (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 : CTEK), which produces patented high-tech laminates for the printed circuit board industry, today reported results for the fourth quarter and year ended December 31, 1998. Total revenues for the fourth quarter were $67,557, compared with $95,936 for the same 1997 period. Net loss for the quarter declined to $1,350,278 from a loss of $2,034,211 for the same 1997 period. For the 1998 quarter, after giving effect to an accrued 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. dividend of $39,356 (a non-cash item), basic and 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. loss per share attributable to common stockholders was 11 cents. For the 1997 quarter, basic and diluted loss per share was 29 cents. Total revenues for the year were $414,396, compared with $507,403 in 1997. Revenues for 1998 included $64,254 of amortization of licensing income. Net loss for the year was $5,810,595 compared with $7,569,793 for 1997. For 1998, after providing for the non-cash-preferred dividend of $406,686, basic and diluted loss per share attributable to common stockholders was 54 cents compared with $1.18 for 1997. The company said the decreased losses for the quarter and year compared with the same prior year periods were due primarily to the lower level of manufacturing expenses, reflecting sales that were below expectations as well as reductions in manufacturing costs and to the reduction in amortization of debt discount of $293,753 for the quarter and $828,615 for the year. Christopher F. Johnson, president and 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. of Compositech, stated, "The expansion of the company's sales efforts during the second half of 1998 has added additional customers to the qualification process which leads to production orders. The company has shipped laminates to more than 60 customers for production, evaluation and qualification since June of 1998. Teradyne Connection Systems is our largest current customer, and several other customers are in the final stages of product qualification. We plan rapid sales volume increases in 1999 resulting from this broader customer exposure. "In January, as part of our increased sales effort, the company hired Ed Kelley as technical director. With his prior experience at Hadco Corporation, Mr. Kelley brings substantial printed circuit board fabrication fabrication (fab´rikā´sh  n),n the construction or making of a restoration. experience with the use of CL200+ laminates. We have also engaged additional sales agents to complete comprehensive coverage of the North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. market and are in the process of hiring a western region technical sales manager sales manager n → gerente m/f de ventas sales manager n → directeur commercial sales manager sale n → ." Mr. Johnson added, "The installation and startup of additional production equipment scheduled for the fourth quarter of 1998 is complete and overall capacity ramp-up activities are under way. We are working on long-term material supply agreements designed to utilize the majority of the company's capacity. The projected startup of the plants of our Canadian and Taiwan joint ventures by mid-2000 will provide substantial increases in capacity to meet anticipated sales demand and establish multiple manufacturing locations. Samuel S Samuel, two books of the Bible, originally a single work, called First and Second Samuel in modern Bibles, and First and Second Kingdoms in the Septuagint. They are considered part of "Deuteronomistic history," in which the book of Deuteronomy functions as the . Gross, the chief financial officer, reported that in March 1999, the company closed on the first tranche Tranche One of several related securities offered at the same time. Tranches from the same offering usually have different risk, reward, and/or maturity characteristics. tranche A class of bonds. of $500,000 of a $1.5 million six-month term note series payable at maturity in cash or stock at the company's option. The company also completed a private placement of common stock and warrants begun in late 1998, in which during 1999 it sold 1,067,068 shares of common stock and issued warrants to buy 507,803 shares of common stock at prices ranging from $1-1/8 to $2-1/8, realizing approximately $1.4 million. Subsequent to December 31, 1998, 195 of the 220 shares of Series B convertible preferred stock Convertible Preferred Stock Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date. Also known as "convertible preferred shares". were converted into 1,387,331 shares of common stock. Mr. Gross also announced that on March 26, 1999, the stockholders approved an increase in the authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: common shares from 25 million to 50 million. Mr. Gross stated, "These transactions will permit us to carry on our programs while we consider financing alternatives primarily focused on strategic industry partners or equity financing Equity Financing The act of raising money for company activities by selling common or preferred stock to individual or institutional investors. In return for the money paid, shareholders receive ownership interests in the corporation. ." Compositech, Ltd. develops, produces and markets innovative and superior copper-clad, fiberglass epoxy epoxy Any of a class of thermosetting polymers, polyethers built up from monomers with an ether group that takes the form of a three-membered epoxide ring. The familiar two-part epoxy adhesives consist of a resin with epoxide rings at the ends of its molecules and a curing laminates used to manufacture printed circuit boards which are essential components of personal computers, workstations, data communications data communications, application of telecommunications technology to the problem of transmitting data, especially to, from, or between computers. In popular usage, it is said that data communications make it possible for one computer to "talk" with another. , Internet servers and telecommunications equipment. The statements made in this press release contain certain 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. within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934 that involve a number of risks and uncertainties. Actual events or results may differ from the Company's expectations. In addition to the matters described in this press release, risk factors listed from time to time in the Company's SEC reports and filings, including, but not limited to, its report on Form 10-KSB for the year ended December 31, 1998, may affect the results achieved by the Company. -0-
COMPOSITECH LTD.
Financial Highlights (Unaudited)
For the Three Months Ended For the Year Ended
12/31/98 12/31/97 12/31/98 12/31/97
Revenues $67,557 $95,936 $414,396 $507,403
Net loss ($1,350,278) ($2,034,211) ($5,810,595) ($7,569,793)
Loss per common share
basic and diluted ($.11) ($.29) ($.54) ($1.18)
Shares used in computing
net loss per share 12,710,567 7,120,044 11,612,001 6,389,750
-0-
COMPOSITECH LTD. BALANCE SHEET
December 31, 1998
Current assets $ 653,866
Cash and cash equivalents 102,286
Current liabilities 1,755,627
Long-term debt 1,595,000
Stockholder's equity $4,402,470
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