QualMark Corporation Reports Second-Quarter Results.Business Editors/High-Tech Writers DENVER--(BUSINESS WIRE)--July 30, 2003 QualMark Corporation (OTCBB OTCBB See OTC Bulletin Board (OTCBB). : QMRK) a world leader in designing, manufacturing and marketing HALT (Highly Accelerated Life Testing) and HASS (Highly Accelerated Stress Screening) systems, today announced results for the second quarter ended June June: see month. 30, 2003. QualMark increased revenue 48% from the first quarter of 2003, and announced an income of $49,000, before $536,000 in arbitration-related expenses. The Company reported a net loss of $487,000 and $830,000 on revenue of $1,977,000 and $3,310,000 for the second quarter and year to date for 2003, versus a net loss of $167,000 and $288,000 on revenue of $2,084,000 and $3,987,000 for the second quarter and year to date for 2002. 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 was $0.16 and $0.29 for the second quarter and year to date for 2003, versus a basic and diluted loss per share of $0.07 and $0.25 for the second quarter and year to date for 2002. "We have many accomplishments to report from the second quarter. First off, we generated approximately $50,000 of profit, on revenue just over $1,900,000 (excluding the arbitration-related expenses). The overall demand strengthened for both the Equipment and ARTC ARTC Arthrocare Corp (stock symbol) ARTC Australian Rail Track Corporation ARTC Air Route Traffic Control ARTC Association de la Recherche Theatrale au Canada ARTC Andean Root and Tuber Crops segments of our business, with a steady order flow heading into the remainder of the year. Our very important Asia Pacific business has come back to life post SARS, and the defense industry has contributed to approximately 26% of our business for the quarter. The newly introduced OVTT OVTT Out-of-Vehicle Travel Time (Omni-Vibrational Table Top) has recently experienced its first sales into the consumer electronics industry and is generating an increasing interest. Finally, the Company completed the ongoing arbitration arbitration Process of resolving a dispute or a grievance outside a court system by presenting it for decision to an impartial third party. Both sides in the dispute usually must agree in advance to the choice of arbitrator and certify that they will abide by the with Dr. Hobbs Hobbs, city (1990 pop. 29,115), Lea co., SE N.Mex.; inc. 1929. With the discovery (c.1928) of oil and natural gas in the area, Hobbs became one of the last great oil boomtowns in the United States. It remains a major shipping and trading center for oil-well supplies. and is now able move forward and focus on business," said Charles Charles, archduke of Austria Charles, 1771–1847, archduke of Austria; brother of Holy Roman Emperor Francis II. Despite his epilepsy, he was the ablest Austrian commander in the French Revolutionary and Napoleonic wars; however, he was handicapped by D. Johnston, 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 QualMark. Mr. Johnston continued: "For this quarter, we saw signs of overall business condition improvement, revenues increase 48% and profitability increase over 100%, when you exclude the $536,000 of arbitration-related expenses, over the first quarter of 2003. Operational improvements were also made across the board: inventories were reduced by 30% from the first quarter of 2003, the breakeven breakeven 1. The level of output or sales necessary to cover fixed expenses. Companies in industries that have high fixed costs and, consequently, high breakevens, such as automobile and steel manufacturing, are likely to exhibit large fluctuations point continues to be decreased, and we have maintained our plan to reduce our overall bank debt, which is now, just over $1 million." A quarterly conference call to discuss first-quarter results will also be held today, July 30, 2003, at 11:00 a.m. Eastern Time. To participate via conference call dial 888-318-6430 (if calling from within the U.S.) no later than 10:50 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy on July 30. If you are calling from outside of the U.S., please call 334-323-7224. The leader name is Charles Johnston Charles Johnston can refer to several people:
Quarter to Date Year to Date
June 30, June 30,
2003 2002 2003 2002
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Systems revenue $1,701,000 $1,786,000 $2,779,000 $3,098,000
ARTC service revenue 276,000 298,000 531,000 889,000
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Total revenue 1,977,000 2,084,000 3,310,000 3,987,000
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Gross profit 823,000 895,000 1,233,000 1,681,000
Gross profit margin 41.6% 42.9% 37.3% 42.2%
------------------------------------------------
Loss from operations (a)(462,000) (118,000) (a)(773,000) (193,000)
Net loss (a)(487,000) (167,000) (a)(830,000) (288,000)
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(a) Includes $536,000
for arbitration-
related charges
Earnings Per Share
Reconciling Items:
Accretion of
redeemable preferred
stock dividends (48,000) (45,000) (96,000) (71,000)
Accretion of
beneficial conversion
feature and warrants
on issuance of
redeemable preferred
stock (54,000) (55,000) (108,000) (61,000)
Dividend resulting
from conversion of
Series A preferred
shares to Series B
preferred shares -- -- -- (489,000)
================================================
Net loss available to
common shareholders (589,000) (267,000) (1,034,000) (909,000)
================================================
Basic earnings (loss)
per share (a)$(0.16) $(0.07) (a)$(0.29) $(0.25)
Diluted earnings
(loss) per share (a)$(0.16) $(0.07) (a)$(0.29) $(0.25)
================================================
Basic weighted average
shares outstanding 3,610,000 3,610,000 3,610,000 3,610,000
Diluted weighted
average shares
outstanding 3,610,000 3,610,000 3,610,000 3,610,000
================================================
QualMark Corporation, headquartered in Denver, Colorado, is the leader in designing, marketing, and manufacturing accelerated life-testing systems providing America's largest corporations with products that improve product reliability and allow them to get to market faster. The Company has installed more than 450 of its proprietary testing systems in 18 countries and operates five of its own testing and consulting facilities in Denver, Colo.; Santa Clara Santa Clara, city, Cuba Santa Clara (sän`tä klä`rä), city (1994 est. pop. 217,000), capital of Villa Clara prov., central Cuba. , Calif.; Hopkinton, Mass.; Huntington Beach Huntington Beach, city (1990 pop. 181,519), Orange co., S Calif., on the Pacific coast, across from Santa Catalina Island, in an oil-producing area; inc. 1909. It manufactures aerospace vehicles, aircraft parts, optical instruments, and heat transfer equipment. , Calif.; and Winter Park, Fla. In Detroit, Mich., the Company has a strategic alliance with a large testing facility. QualMark has also formed international ARTC alliances in Ireland, the Netherlands, Italy, France and Sweden. The Company also offers engineering services and products that complement the core technologies of QualMark and other test equipment providers. The statements included in this press release concerning predictions of economic performance and management's plans and objectives constitute 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. made pursuant to the 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. provisions of Section 21E of the Securities Exchange Act of 1934, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. , and Section 27A of the Securities Act of 1933, as amended. These statements involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors which could cause or contribute to such differences include, but are not limited to, factors detailed in the Company's Securities and Exchange Commission filings; downturns in the Company's primary markets; variability of order flow, future economic conditions; competitive products and pricing; new product development; disruptions in the Company's operations from acts of God or extended maintenance; transportation difficulties; or the delivery of product under existing contracts and other factors. |
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