Entrada Networks Announces Third Quarter Results.

Business Editors & High-Tech Writers

IRVINE, Calif.--(BUSINESS WIRE)--Dec. 21, 2001

Entrada Networks, Inc. (Nasdaq:ESAN) today announced results for the third quarter of fiscal year 2002 ended October 31, 2001. The Company reported total net sales from its adapter card business and the frame relay business of $3.1 million for the third quarter, compared with $7.9 million reported in the same period last year.

For the third quarter the Company reported a net loss of $1.0 million, or $0.09 per share, compared to a net loss of $12.6 million, or $1.43 per share, for the same period last year.

For the nine months ended October 31, 2001, the Company reported net sales of $9.9 million compared with $17.6 million reported in the same period last year. For the nine months ended October 31, 2001 the Company's net loss decreased to $7.2 million, or $0.66 per share, from a net loss of $20.4 million, or $3.54 per share, for the same period last year.

The Company also affirmed that it has implemented the staff and cost reductions, and the consolidation of operations to Irvine, California in order to improve its bottom line and revert to a path to profitability as announced on October 23, 2001. To help facilitate this transition, while the Company has adequate bank credit line, it does need to raise money to improve its working capital and help pay the costs incurred with downsizing, employee severances, cosolidation of facilities and operations.

FINANCIAL DETAILS
Selected highlights from Entrada's third quarter fiscal 2002 are
presented below:

ENTRADA NETWORKS, INC.
AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(In Thousands)

                                   October 31, 2001   January 31, 2001
ASSETS

CURRENT ASSETS
 Cash and equivalents                 $          65      $       9,953
 Restricted cash                                300                300
 Accounts receivable, net                     1,982              4,373
 Inventory, net                               4,169              4,636
 Prepaid expenses and other current assets      677                298
  TOTAL CURRENT ASSETS                        7,193             19,560
PROPERTY AND EQUIPMENT, NET                   1,474              2,452
OTHER ASSETS                                    679                  0
TOTAL ASSETS                          $       9,346      $      22,012

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
 Short-term debt                      $         548      $       3,568
 Current maturities of long term debt           132                394
 Accounts payable                             2,567              1,725
 Net liabilities of discontinued operations       0              3,892
 Other current and accrued liabilities        3,090              2,166
  TOTAL CURRENT LIABILITIES                   6,337             11,745
Long-term debt and capital lease obligations     58                131
  TOTAL LIABILITIES                           6,395             11,876
STOCKHOLDERS' EQUITY
 Common stock, $.001 par value; 50,000 shares
  authorized; 10,992 shares issued and
  outstanding at July 31, 2001; 10,993 shares
  issued and outstanding at January 31, 2001     11                 11
 Additional paid-in capital                  51,765             51,722
 Accumulated deficit                        (48,825)           (41,597)
  TOTAL STOCKHOLDERS' EQUITY                  2,951             10,136
TOTAL LIABILITIES AND STOCKHOLDERS'
 EQUITY                               $       9,346      $      22,012


ENTRADA NETWORKS, INC.
AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, except per share amounts)

                          Three Months Ended         Nine Months Ended
                              October 31                October 31
                           2001       2000            2001       2000
                       (Unaudited)(Unaudited)    (Unaudited)(Unaudited)

NET SALES              $    3,078 $    7,890     $    9,863 $   17,641
COST OF SALES               2,065      7,522          6,250     16,615
 GROSS PROFIT               1,013        368          3,613      1,026
OPERATING EXPENSES
 Selling and marketing        671      1,426          3,173      3,778
 Engineering, research and
  development               1,334      2,347          6,093      5,105
 General and administrative   934        893          2,989      1,945
 Other operating expenses   1,292      5,874          1,774      6,870
  TOTAL OPERATING EXPENSES  4,231     10,540         14,029     17,698
LOSS FROM OPERATIONS       (3,218)   (10,172)       (10,416)   (16,672)
OTHER INCOME (CHARGES)
 Interest expense             (79)      (121)          (213)      (346)
  TOTAL OTHER INCOME
  (CHARGES)                   (79)      (121)          (213)      (346)
LOSS FROM CONTINUING
 OPERATIONS BEFORE INCOME
 TAX                       (3,297)   (10,293)       (10,629)   (17,018)
PROVISION FOR INCOME TAXES      -          -              -          -
LOSS FROM CONTINUING
 OPERATIONS                (3,297)   (10,293)       (10,629)   (17,018)
LOSS FROM DISCONTINUED
 OPERATIONS                                -                         -
INCOME (LOSS) ON DISPOSAL
 OF DISCONTINUED
 OPERATIONS                 2,309     (2,309)         3,401     (3,401)
NET LOSS               $     (988)$  (12,602)    $   (7,228)$  (20,419)
BASIC AND DILUTED (INCOME)
 LOSS PER COMMON SHARE:
 WEIGHTED AVERAGE COMMON
  SHARES  OUTSTANDING
 (IN THOUSANDS)            10,992      8,789         10,992      5,770
 NET INCOME (LOSS) PER
  COMMON SHARE:
  Continuing
  operations           $    (0.30)$    (1.17)    $    (0.97)$    (2.95)
  BASIC AND DILUTED
   NET LOSS PER COMMON
   SHARE               $    (0.09)$    (1.43)    $    (0.66)$    (3.54)


Note: With the retention of Sync Research, Inc. during Q3 FY2002,
the historical figures for three and nine months ended October 31,
2000 of $(426) thousand for the `Income from Discontinued Operations'
were reclassified to operating expenses in cost of sales, selling and
marketing, engineering, and general and administrative. The estimated
loss consists of $2.2 million from inventory impairments included in
Cost of Sales and $5.9 million and $4.8 million, respectively for the
three and nine months ended October 31, 2000 for goodwill, vendor
payables, severance costs, lease termination and various other
estimated costs for disposal of the business segment. The historical
figures for Net Income (loss) did not change.

About Entrada Networks

Entrada Networks has three wholly owned subsidiaries that focus on developing and marketing products in the storage networking and network connectivity industries. Rixon Networks manufactures and sells a line of fast and gigabit Ethernet adapter cards that are purchased by large networking original equipment manufacturers as original equipment for servers, and other computer and telecommunications products. Its focus is on two- and four-port cards and drivers for highly specialized applications. Sync Research manufactures and services frame relay products for some of the major financial institutions in the U.S. and abroad. The Torrey Pines subsidiary specializes in the design & development of SAN transport switching products (which efforts are currently suspended). Entrada Networks is headquartered in Irvine, Ca.

Safe Harbor

Except for historical information contained herein, the matters set forth in this news release are forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from those set forth in the forward-looking statements, including but not limited to the following factors: 1) the ability of the Company to generate the cash flow from operations, or raise additional capital necessary to finance its ongoing businesses; 2) the ability of the Company to develop or acquire new profitable lines of business and to attract and retain management to lead this effort; 3) the continuing market acceptance of the legacy products which account for all of the Company's current revenues; 4) the ability of the Company to generate revenues from its now suspended research and development efforts in the SAN space; 5) The much greater financial and other resources of Entrada Networks' many well-entrenched competitors; 6) the adoption of technology standards different from those under which Entrada is prepared to deliver products; and 7) such other factors as are set forth in Entrada's annual report on Form 10-K, filed May 4, 2001, and in the reports previously filed by Entrada's former Parent, Sorrento Networks Corporation or Sync Research with the U.S. Securities and Exchange Commission, including but not limited to the Reports of Sync Research, Inc., filed in connection with its merger with Entrada on Form S-4 and S-4/A.