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NETRIX ANNOUNCES SECOND QUARTER RESULTS

 HERNDON, Va., July 22 /PRNewswire/ -- Netrix Corporation (NASDAQ: NTRX) today reported that in its second quarter ended June 30, 1993, total revenue was $4,675,000 compared to $7,186,000 for the same period last year. The company said that the decreased revenue resulted in a loss for the quarter of $3,020,000, or $0.36 per share, compared to net income of $546,000 or $0.09 per share in the same quarter last year. Year-to-date revenue for 1993 was $8,284,000, with a loss of $0.65 per share, compared to $13,941,000 and income of $0.16 per share for the same period last year.
 The company attributed the loss for the quarter primarily to the previously reported soft market conditions in Europe. The company also noted that, as reported yesterday, it has reached a preliminary settlement of a shareholder lawsuit. The settlement and related costs resulted in a one-time charge against earnings of approximately $775,000, or $0.09 per share, in the second quarter of 1993.
 President and CEO Charles W. Stein said, "We have initiated efforts to control operating expenses while the market is weak, but we have also increased our investment in R&D and the service segment of our business because these are the cornerstones of our strategy for growth." Total R&D expense in the quarter was $1.6 million, up from $1.3 million in the same quarter last year. Stein noted that the cost reduction efforts implemented at the end of May will not be reflected in the company's financial results until subsequent quarters.
 He said that he is "encouraged" by new orders and by progress being made by the new distribution channels put into effect in Europe with Siemens Private Networks, AG, and in North America with ROLM. Stein commented, "We received initial orders from eight new network customers, including a substantial order from a customer in China; Siemens took delivery of equipment for their first network customer in Germany; and we have begun to receive orders from ROLM for new networks. Backlog increased during the quarter as a result of these and other activities."
 "We began shipment of our new LAN Router/Bridge/PAD product, the BRX, to initial customers, and several initial installations of our switched compressed voice feature, utilizing the VFM, are now fully operational. We continue to ship the SPM3 (the new processor module for our Series 10 product line) in volume, and it is operating well in a number of our customers networks. These new product introductions reflect our ongoing commitment to R&D," Stein continued.
 Separately, Netrix announced that Dr. Holger Opderbeck has resigned from the Board of Directors effective July 10, 1993, but he will continue with the company as the Vice President and Chief Technical Officer. Opderbeck said he resigned from the Board because, "The expertise I could provide at the Board-level was appropriate when we were a start-up company. The Board now needs experience that is better suited to the company s next stage of growth, and I'd like to focus my efforts in helping the company nurture its technology for future generations of product development."
 Netrix Corporation manufactures and markets products that are used to build new corporate networks and to consolidate multiple application- specific networks into more effective enterprise-wide networks. The company's products enable network managers to optimize and simplify their networks by matching each application to the best switching technology and to the most appropriate communications facilities. Netrix customers include financial services companies, other major corporations, public network operators, and government agencies throughout the world.
 Condensed Statements of Operations and Balance Sheets follow.
 NETRIX CORPORATION
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (Unaudited)
 (In thousands, except per share amount)
 Six Months Ended Three Months Ended
 June 30, June 30,
 1993 1992 1993 1992
 Revenues:
 Product $6,501 $12,091 $3,778 $6,166
 Service 1,783 1,850 897 1,020
 Total revenues 8,284 13,941 4,675 7,186
 Cost of revenues:
 Product 2,909 4,619 1,704 2,275
 Service 1,572 1,013 833 502
 Total cost
 of revenues 4,481 5,632 2,537 2,777
 Gross profit 3,803 8,309 2,138 4,409
 Operating expenses:
 Sales and
 marketing 4,273 3,688 2,097 1,887
 Research and
 development 2,914 2,473 1,554 1,329
 General and
 administrative 1,518 1,137 842 628
 Income (loss)
 from operations (4,902) 1,011 (2,355) 565
 Settlement and
 litigation expenses 775 -- 775 --
 Interest (income)
 expense, net (300) 3 (142) (4)
 Income (loss)
 before income taxes (5,377) 1,008 (2,988) 569
 Provision for
 income taxes 3 37 32 23
 Net income (loss) $(5,380) $971 $(3,020) $546
 Earnings (loss)
 per share $(0.65) $0.16 $(0.36) $0.09
 Weighted average number
 of shares outstanding 8,289 6,144 8,300 6,142
 NETRIX CORPORATION
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (In thousands, except share amounts)
 June 30, Dec. 31,
 1993 1992
 (Unaudited)
 ASSETS
 Current assets:
 Cash and cash equivalents $6,976 $7,535
 Short-term investments 13,460 16,977
 Accounts receivable, net 5,882 12,055
 Inventories 7,552 4,608
 Other current assets 1,161 343
 Total current assets 35,031 41,518
 Property and equipment, net 5,174 4,909
 Deposits and other assets 1,301 403
 Total $41,506 $46,830
 LIABILITIES AND STOCKHOLDERS' EQUITY
 Current liabilities:
 Accounts payable $2,224 $2,425
 Accrued liabilities 4,440 3,782
 Current portion of capital lease obligations 704 768
 Total current liabilities 7,368 6,975
 Capital lease obligations,
 net of current portion 681 1,048
 Deferred rent, net of current portion 1,116 1,192
 Total 9,165 9,215
 Stockholders' equity:
 Preferred stock, $0.05 par value;
 1,000,000 shares authorized; none issued
 and outstanding -- --
 Common stock, $0.05 par value;
 15,000,000 shares authorized;
 8,320,982 and 8,265,233 shares
 issued and outstanding at June 30,
 1993 and Dec. 31, 1992,
 respectively 416 413
 Additional paid-in capital 50,316 50,213
 Accumulated deficit (18,391) (13,011)
 Total stockholders' equity 32,341 37,615
 Total $41,506 $46,830
 -0- 7/22/93
 /NOTE: Netrix is a registered trademark./
 /CONTACT: Louann Curlin, manager, treasury services, 703-793-2051, or Ellen Jennings, director, marketing communications, 703-793-2016, both of Netrix/
 (NTRX)


CO: Netrix Corporation ST: Virginia IN: CPR SU: ERN

KD-DC -- DC028 -- 4767 07/22/93 16:38 EDT
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Date:Jul 22, 1993
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