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Mosaid Reports Year End Results.

OTTAWA--(BUSINESS WIRE)--June 18, 1997--(TSE MSD. ) MOSAID Technologies Incorporated (TSE:MSD) reported revenues of $39,799,000 for its fiscal year ended May 2, 1997, representing an increase of 5 percent over fiscal 1996 revenues of $37,778,000. Net earnings for fiscal 1997 were $3,748,000 representing a decrease of 52 percent from fiscal 1996 net earnings of $7,818,000. Earnings per share, on a fully diluted basis, were $0.49 for fiscal 1997 compared to $1.03 for fiscal 1996. Net earnings reflect an unusual item, the relocation costs associated with the Company's decision to build new facilities; and its non-controlling interest, its equity share of Accelerix Inc.'s loss for the year. Earnings before unusual item, income tax and non-controlling interest were $9,863,000 for fiscal 1997, a decrease of 23 percent from the $12,820,000 result for fiscal 1996.

Revenues of $10,309,000 were reported for the fourth fiscal quarter ended May 2, 1997, compared to $10,764,000 for the fourth quarter ended April 30, 1996, a decrease of 4 percent. Net earnings for the quarter were $241,000, compared to $2,103,000 for the fourth quarter ended April 30, 1996, a decrease of 89 percent. Earnings per share, on a fully diluted basis, for the quarter were $0.03, compared to $0.27 for the corresponding quarter last year.

"In fiscal 1997 we did not meet the financial objectives we had set for ourselves last year when the memory markets were robust, but considering the downturn in the market which occurred this year, and MOSAID's increased level of investment in R&D ($3,202,000 more than fiscal 1996) and Accelerix, we are satisfied with our performance. Not only have we laid the foundation for continued growth in both the memory design and the engineering tester markets, we maintained profitability throughout the year, and we managed modest growth in a year when most of our customers' revenues declined significantly," said George J.J. Cwynar, President and CEO. "The highlights of the year centre around the themes of investment and growth: we continued to grow our memory design team, in the face of burgeoning demand for our expertise and were selected by the SLDRAM Consortium to develop the reference design for a new generation of memory chips; we shipped several of the new MS4105 engineering test system series in the fourth quarter; we launched Accelerix, our first component initiative; we continued to add to our intellectual property portfolio, and licensed our HDRAM(R) macrocell technology to two companies for sublicensing; we bought land and commenced the design and construction of our new facilities; and finally, we exited the year with a strengthened backlog of business in both our Semiconductor and Systems Divisions."

MOSAID Chairman Richard C. Foss commented on the industry environment and trends relevant to the Company: "While the semiconductor memory market continues to demonstrate its capacity for volatility, we are very comfortable with the positioning of MOSAID. The basic trends of the market - its rapid transition, its continued specialization, its broadening from computers to include all manner of digital electronics products, the proliferation of both Application Specific Memory solutions and fabless semiconductor companies - are fundamental to MOSAID's vision of the future and its adopted strategic direction."

MOSAID designs advanced chips for standard memory and Application Specific Memory (ASM) requirements. The Company also designs, manufactures and distributes engineering test systems for memory chips. MOSAID is a leading independent memory chip design house and the leading supplier of engineering memory test systems in the world.

THREE FINANCIAL STATEMENTS TO FOLLOW


MOSAID TECHNOLOGIES INCORPORATED
(incorporated under the Ontario Business Corporations Act)
CONSOLIDATED BALANCE SHEET
(in thousands of Canadian dollars)

 As at As at
 May 2, April 30,
 1997 1996
 (Unaudited) (Audited)
Current Assets
 Cash and short term marketable
 securities $18,337 $21,818
 Accounts receivable 11,250 12,656
 Revenues recognized in excess
 of amounts billed 3,656 832
 Inventories 4,490 2,978
 Prepaid expenses 576 343
 ------- -------
 38,309 38,627

Capital assets 7,440 4,327
Technology acquisitions 995 -
Long-term investments 1,712 1,376
 ------- -------
 $48,456 $44,330

Current Liabilities
 Accounts payable and accrued
 liabilities $ 4,988 $ 4,557
 Income taxes payable 301 1,761
 Deferred revenue 636 138
 Deferred income taxes 383 252
 ------- -------
 6,308 6,708

Obligations under capital leases - 16
Deferred income taxes 713 795
 ------- -------
 7,021 7,519
 ------- -------
Shareholders' Equity
 Share capital 20,825 19,949
 Retained Earnings 20,610 16,862
 ------- -------
 41,435 36,811
 ------- -------
 $48,456 $44,330
 ------- -------
 ------- -------


MOSAID TECHNOLOGIES INCORPORATED
CONSOLIDATED STATEMENT OF EARNINGS AND RETAINED EARNINGS
(in thousands of Canadian dollars, except per share amounts)
(unaudited)

 Three
 13 weeks months Year ended
 ended ended
 May 2, April, 30 May 2, April 30,
 1997 1996 1997 1996

Revenues
 Operations $10,135 $10,423 $38,853 $36,395
 Interest 174 341 946 1,383
 -------- ------- ------- -------
 10,309 10,764 39,799 37,778
 -------- ------- ------- -------
Expenses
 Labour and materials 2,556 2,534 9,051 8,185
 Research and development 3,157 1,950 10,009 6,807
 Selling and marketing 1,700 1,197 6,276 5,109
 General and
 administration 1,169 1,483 5,270 4,557
 Gain on sale of assets - - (670) -
 Other - - - 300
 -------- ------- ------- -------
Total expenses 8,582 7,164 29,936 24,958
 -------- ------- ------- -------

Earnings before unusual item,
 income tax, and non-controlling
 interest 1,727 3,600 9,863 12,820
Unusual item 500 - 500 -
 ------- ------- ------- -------
 1,227 3,600 9,363 12,820

Income tax 403 1,497 3,381 5,002

Non-controlling interest 583 - 2,234 -
 ------- ------- ------- -------

Net Earnings 241 2,103 3,748 7,818
Retained Earnings,
 beginning of year 20,369 14,759 16,862 9,044
 ------- ------- ------- -------
Retained Earnings,
 end of year $20,610 $16,862 $20,610 $16,862
 ------- ------- ------- -------
 ------- ------- ------- -------

Earnings per share
 Basic $0.03 $0.30 $0.53 $1.13
 Fully diluted $0.03 $0.27 $0.49 $1.03

Weighted average number of shares
 Basic 7,104,104 7,000,577 7,071,576 6,940,236
 Fully diluted 7,863,129 7,667,795 7,781,487 7,621,287


 MOSAID TECHNOLOGIES INCORPORATED
 CONSOLIDATED STATEMENT OF
 CHANGES IN FINANCIAL POSITION
 (in thousands of Canadian dollars)
 (unaudited)

 Year ended
 May 2, April 30,
 1997 1996

Operating
 Net earnings $ 3,748 $ 7,818
 Items not affecting cash
 Amortization 2,405 1,276
 Loss on disposal of capital
 assets 22 89
 Non-controlling interest 2,234 -
 Investment tax credits - 700
 Deferred income taxes 49 42
 --------- --------
 8,458 9,925
 --------- --------

Change in non-cash working capital
 items (3,694) (4,034)
 --------- --------
 --------- --------
 4,764 5,891
Investing
 Acquisition of capital assets -net (5,366) (2,884)
 Acquisition of technology (1,169) -
 Long-term investments (2,570) (1,376)
 --------- --------
 (9,105) (4,260)
 --------- --------

Financing
 Repayment of obligations under
 capital leases (16) (43)
 Issue of common shares 876 866
 --------- --------
 860 823
 --------- --------

Net cash outflow (3,481) 2,454
Cash position, beginning of period 21,818 19,364
 --------- --------
Cash position, end of period $18,337 $21,818
 --------- --------
Cash comprises the following:
 Cash $ 3,028 $ 5,032
 Marketable Securities 15,309 16,786
 --------- --------
 $18,337 $21,818
 --------- --------
 --------- --------





CONTACT: Mosaid Technologies Incorporated

Sue Rutherford, 613/836-3134
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