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PINNACLE MICRO REPORTS RECORD SECOND QUARTER AND SIX MONTH RESULTS

 IRVINE, Calif., Aug. 3 /PRNewswire/ -- Pinnacle Micro Inc. (NASDAQ: PNCL) today reported record results of the second quarter and six months ended June 30, 1993. Sales for the three-month period increased 118 percent to $9,260,000, up from $4,243,000 reported in the second quarter of 1992. Operating income increased to $630,000 during the second quarter of 1993 versus an operating loss of $101,000 in last year's second quarter. Pro forma net income was $362,000, or 9 cents per share, for the second quarter of 1993, as compared to the pro forma net loss of $66,000, or 2 cents per share, in the second quarter of 1992. Effective July 1, 1993, the company converted from an S corporation to a C corporation. The pro forma data reflect provisions for federal and state income taxes as if the company were treated as a C corporation.
 Sales for the six-month period ended June 30, 1993, increased 107 percent to $17,851,000 up from $8,630,000 reported in the first six months of 1992. Operating income was $1,239,000 during the six-month period of 1993 versus an operating loss of $21,000 in last year's first six months. Pro forma net income was $722,000, or 18 cents per share, for the second quarter, as compared to the pro forma net loss of $16,000, or 0 cents per share, in the second quarter of 1992.
 The company completed its initial public offering of 1.8 million shares of common stock, underwritten by Prudential Securities Inc. on July 1, 1993.
 "The strong second quarter results reflect increases in unit sales and an incremental product shift mix to our proprietary optical storage systems," said William F. Blum, president and chief executive officer. "In addition, our international sales in the first six months of 1993 have increased approximately 140 percent over the first six months of 1992."
 Pinnacle Micro is a leading designer, manufacturer and supplier of optical storage systems for data intensive applications such as network storage, imaging, desktop publishing and pre-press, as well as the emerging applications such as digital audio/video editing and commercial multimedia. Founded in 1987, the company is headquartered in Irvine with offices in North America, Europe and the Pacific Rim.
 PINNACLE MICRO INC.
 Condensed Statements of Income
 (Unaudited)
 (In thousands, except per share data)
 Three months ended Six months ended
 June 30: 1993 1992 1993 1992
 Net sales $9,259.8 $4,243.0 $17,851.2 $8,630.1
 Cost of sales 6,207.0 2,960.4 11,819.3 5,979.4
 Gross profit 3,052.8 1,282.6 6,031.9 2,650.7
 Operating expenses:
 Selling, general and
 administrative 2,047.6 1,090.6 4,058.3 2,162.5
 Research and
 development 375.0 293.2 734.5 509.3
 Total operating
 expenses 2,422.6 1,383.8 4,792.8 2,671.8
 Operating income
 (loss) 630.2 (101.2) 1,239.1 (21.1)
 Interest expense 26.3 1.5 43.3 2.9
 Income (loss) before
 income taxes 603.9 (102.7) 1,195.8 (24.0)
 Income taxes (benefit) 15.1 (3.0) 30.1 (1.0)
 Net income (loss) $ 588.8 ($99.7) $ 1,165.7 ($23.0)
 Pro Forma data:
 Historical income
 (loss) before income
 taxes $ 603.9 ($102.7) $ 1,195.8 ($24.0)
 Pro forma provision
 for income taxes 241.6 (36.9) 473.6 (8.2)
 Pro forma net income
 (loss) $ 362.3 ($65.8) $ 722.2 ($15.8)
 Pro forma net income
 (loss) per share $ 0.09 ($0.02) $ 0.18 $0.00
 Weighted average common
 shares outstanding 3,931.1 3,881.8 3,931.1 3,881.8
 PINNACLE MICRO INC.
 Condensed Balance Sheet
 (In thousands)
 ASSETS June 30, June 30, Dec. 31,
 1993 1993 1992
 (unaudited) (pro forma)
 Current assets:
 Cash and cash equivalents $ 566.5 $ 566.5 $ 475.2
 Accounts receivable, net 4,631.1 4,631.1 3,899.0
 Inventories 2,653.6 2,653.6 1,732.2
 Prepaid expenses and other
 current assets 740.9 740.9 344.4
 Total current assets 8,592.1 8,592.1 6,450.8
 Furniture and equipment, net 749.3 749.3 716.1
 Other assets 122.0 122.0 130.4
 Total assets $9,463.4 $9,463.4 $7,297.3
 LIABILITIES AND STOCKHOLDERS' EQUITY
 Current liabilities:
 Accounts payable $4,642.9 $4,642.9 $3,808.6
 Accrued expenses 145.8 145.8 112.6
 Payroll related liabilities 158.7 158.7 114.9
 Current portion of notes
 payable to bank and
 long-term debt 886.9 886.9 61.1
 Total current liabilities 5,834.3 5,834.3 4,097.2
 Notes payable to bank and
 long-term debt, less
 current portion 148.4 148.4 179.1
 Pro forma accrual for
 S Corporation distribution --- 3,416.7 ---
 Stockholders' equity:
 Preferred stock, $.001 par
 value:
 Authorized shares -- 5,000,000
 Issued and outstanding -- none
 Common Stock, $.001 par value;
 Authorized shares -- 30,000,000
 Issued and outstanding shares
 3,441,000 at Dec. 31, 1992 and
 3,478,000 at June 30, 1993 3.5 3.5 3.4
 Additional paid-in capital 60.5 60.5 59.6
 Retained earnings 3,416.7 --- 2,958.0
 Total stockholders' equity 3,480.7 64.0 3,021.0
 Total liabilities and
 stockholders' equity $9,463.4 $9,463.4 $7,297.3
 -0- 8/3/93
 /CONTACT: Doug Sherk or Ken Dennard, 415-296-7383, or David Walke or Miriam Adler, 212-850-5600, all of Morgen-Walke for Pinnacle Micro/
 (PNCL)


CO: Pinnacle Micro Inc. ST: California IN: CPR SU: ERN

LH-TM -- SF006 -- 8632 08/03/93 06:31 EDT
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Date:Aug 3, 1993
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