MONITERM ANNOUNCES FILING A PETITION UNDER CHAPTER 11
MONITERM ANNOUNCES FILING A PETITION UNDER CHAPTER 11 MINNETONKA, Minn., Nov. 12 /PRNewswire/ -- Moniterm Corporation
(NASDAQ: MTRM) announced today that it has filed a voluntary petition under Chapter 11 of the United States Bankruptcy Code. The filing also included Moniterm's wholly owned subsidiary, Wasatch High Voltage located in Salt Lake City, Utah.
The company has experienced large and continuing losses since 1989. The immediate cause of the bankruptcy filing was the result of a substantial recent decline in customer demand. Moniterm also announced its third quarter operating results and restated it second quarter results. The second quarter was restated because the company was unable to comply with the terms of its debt forgiveness agreement with certain of its vendors. The company reported a loss in the third quarter of 1991 of $1,182,000 compared to a loss of $464,000 in the third quarter of 1990. Sales declined by 21.5 percent due to continued weakness in the Viking product line and the effect of the computer market recession in the OEM market. The gross profit decline from 17.7 percent in the third quarter of 1990 to 2.1 percent in the third quarter of 1991 was caused by three factors. First, the company increased its reserve for inventory obsolescence by $100,000. Also, the company's Wasatch subsidiary experienced poor performance due to low volume and inefficiencies. Third, pricing pressure in the Viking controller board area resulted in a significant decline in margins. The restated second quarter 1991 results of operations showed a loss of $1,008,000 on sales of $2,684,000. The company believes that the filing under Chapter 11 of the Bankruptcy Code may allow it to reorganize its finances and operations. CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited) (In thousands, except per-share amounts) Three Months Ended Nine Months Ended 9/28/91 9/30/90 9/28/91 9/30/90 Net sales $5,124 $6,512 $13,011 $20,346 Cost of sales 5,019 5,358 12,307 15,963 Gross profit 105 1,154 704 4,383 Operating expense: Selling and administrative 1,092 1,170 2,952 3,484 Engineering 231 341 738 1,123 Operating loss (1,218) (357) (2,986) (224) Other expense (100) (107) (233) (45) Tax benefit -- 74 -- -- Loss before extraordinary item (1,318) (390) (3,219) (269) Extraordinary item 136 (74) 533 -- Net loss $(1,182) $(464) $(2,686) $(269) Loss per common share and common share equivalents: Loss before extraordinary item $(.18) $(.08) $(.57) $(.06) Extraordn?ary item .02 (.02) .10 -- Net loss $(.16) $(.10) $(.47) $(.06) -0- 11/12/91 /CONTACT: John D. McClung of Moniterm, 612-935-4151/ (MTRM) CO: Moniterm Corporation ST: Minnesota IN: SU: ERN JS-KH -- MN013 -- 3546 11/12/91 15:04 EST
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|Date:||Nov 12, 1991|
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