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CONVEX ANNOUNCES FIRST QUARTER RESULTS

 CONVEX ANNOUNCES FIRST QUARTER RESULTS
 RICHARDSON, Texas, April 28 /PRNewswire/ -- Convex Computer


Corporation (NYSE: CNX) today announced its financial results for the first quarter, ended March 31, 1992. Revenue for the period was $54.5 million and net income was $.4 million, or 2 cents per share. The comparable figures for the first quarter of 1991 were revenue of $55.6 million and net income of $4.0 million, or 17 cents per share.
 "We are very pleased that our efforts to improve financial performance have resulted in a return to profitability," said Robert J. Paluck, Convex chairman, president, and chief executive officer. "After two very difficult quarters in 1991, we began to see improvement in the fourth quarter. That improvement has continued in the first quarter of this year. Both revenue and gross margins are up sequentially, due largely to increased availability of new products. Additionally, overhead expense for the quarter is lower than it was in both the year- earlier period and in the fourth quarter of 1991."
 Convex shipped a total of 47 C Series supercomputers during the first quarter. Of those, 10 shipments were the company's high- performance C3800 supercomputer. Customers taking deliveries of these systems included the National Institute of Standards and Technology (NIST), Unocal Corporation and Ford Motor Company, which marked the shipment of the 1000th Convex supercomputer. Also during the quarter, Convex delivered 20 mid-range C3400 departmental supercomputers to a variety of customers whose applications include computer-aided engineering, geophysical processing, computational chemistry, signal processing, and general research. More than 1,000 Convex systems are now being used by 565 customers in 44 countries.
 In March, Convex and Hewlett-Packard Company (HP) entered into extensive business and technology agreements. As part of this relationship, HP agreed to purchase 1.2 million shares of Convex common stock, representing an ownership position in Convex of approximately 5 percent. In addition to this equity agreement, Convex will adopt HP's PA-RISC technologies in massively parallel processing (MPP) supercomputers which are currently under development. Also, both companies have agreed to other core technology exchanges.
 "Our alliance with HP will offer new opportunities for Convex and HP to accelerate the time-to-market for leadership products," noted Paluck. "It represents a combination of proven technologies that will provide the best high-performance computing solutions for customers in industry, government, and research organizations.
 "While our view of the worldwide economic outlook remains conservative, we are continuing to focus on improving the company's financial results," said Paluck. "New product availability is critical to improved financial performance. During the last 90 days, progress has been made in this area as our semiconductor vendors are increasing their supply of key components to Convex. Our challenge now is to increase revenues in a tough economic and competitive climate while continuing to tightly control overhead expenses."
 Convex Computer Corporation, a leading supplier of supercomputers worldwide, was founded in 1982 to design, manufacture, market, and service high performance systems. The company markets its products primarily to scientific, engineering, and technical users throughout the world for a wide variety of applications in such areas as geophysical research, computational chemistry, computer-aided engineering, image processing, aerospace simulations, and molecular biology. The systems are sold and serviced through direct sales and an extensive distribution network.
 FINANCIAL HIGHLIGHTS
 (Unaudited)
 (In thousands, except per share data)
 Three Months Ended
 3/31/92 3/31/91 12/31/91
 Total revenue $54,473 $55,627 $ 51,743
 Operating income (loss) $ 1,104 $ 5,317 $(2,664)
 Net income (loss) $ 404 $ 3,976 $ (937)
 Earnings per common share --
 primary & fully diluted:
 Net income (loss) $.02 $.17 $(.04)
 Weighted average shares
 outstanding -- primary: 23,773 22,753 22,499
 CONVEX COMPUTER CORPORATION
 CONSOLIDATED INCOME STATEMENT
 (unaudited)
 (in thousands, except per share data)
 Three Months Ended
 3/31/92 3/31/91
 Revenue:
 Product and other revenue $ 43,283 $ 46,052
 Service revenue 11,190 9,575
 Total revenue 54,473 55,627
 Costs and expenses:
 Cost of product and other
 revenue 21,871 18,771
 Cost of service revenue 6,756 6,242
 Research and development 7,908 7,209
 Selling, general and
 administrative 16,834 18,088
 Total costs and expenses 53,369 50,310
 Operating income 1,104 5,317
 Other income (expense), net (491) 617
 Income before provision
 for income taxes 613 5,934
 Provision for income taxes 209 1,958
 Net income $ 404 $ 3,976
 Earnings per common
 share-primary & fully
 diluted:
 Net income $ .02 $ .17
 Weighted average shares
 outstanding -- primary: 23,773 22,753
 CONVEX COMPUTER CORPORATION
 CONSOLIDATED BALANCE SHEET
 MARCH 31, 1992
 (unaudited)
 (dollars in thousands)
 ASSETS
 Cash, cash equivalents &
 short-term investments $ 63,214
 Receivables, net 72,249
 Current portion of long-term
 receivables 10,065
 Inventory 43,692
 Prepaid expenses & other current
 assets 15,555
 Total current assets 204,775
 Fixed assets, net 45,286
 Long-term receivables 24,336
 Other assets, net 3,861
 TOTAL ASSETS $278,258
 LIABILITIES & SHAREHOLDERS' EQUITY
 Current liabilities:
 Accounts payable $ 17,335
 Accrued payroll and related taxes 5,920
 Current portion of notes payable 8,007
 Deferred revenue 11,097
 Other current liabilities 18,404
 Total current liabilities 60,763
 Long-term liabilities:
 Notes payable 12,338
 6 percent convertible subordinated
 debentures 53,500
 Total long-term liabilities 65,838
 Shareholders' equity:
 Common stock 231
 Additional capital 124,519
 Retained earnings 28,137
 Cumulative translation adjustment (1,230)
 Total shareholders' equity 151,657
 Total liabilities & shareholders' equity $278,258
 -0- 4/28/92
 /CONTACT: Bill Cool, 214-497-4956, or Donna Burke, 214-497-4230, both of Convex Computer/
 (CNX) CO: Convex Computer Corporation ST: Texas IN: CPR SU: ERN


KD -- NY146 -- 4096 04/28/92 18:21 EDT
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