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RECOGNITION ANNOUNCES IMPROVED SECOND QUARTER RESULTS

 DALLAS, May 20 /PRNewswire/ -- Recognition International Inc. (NYSE: REC) today reported net income for the quarter ended April 30, 1993, of $1,186,000, or 9 cents per share of common stock, compared to a net loss of $1,488,000, or 12 cents per share of common stock for the same period of 1992.
 Second quarter 1992 earnings included a restructuring charge of $2,257,000, or 18 cents per share, in connection with Recognition's purchase of the Lundy Financial Systems Division of TransTechnology Corporation in March 1992.
 Revenues for the quarter ended April 30, 1993, increased 19 percent to $60,819,000, compared to $51,230,000 for the second quarter of 1992. The increase in revenues was due primarily to revenues associated with Recognition's Canadian subsidiary's contracts to provide integrated network products to various branches of the Canadian government and product and service revenues from the Lundy operations.
 Commenting on the results for the second quarter of 1993, Bob Vanourek, president and chief executive officer, said, "Our financial results continue to be in line with our expectations. Our software business continued its growth; we expanded our products' capabilities in our systems business; and our service business continues to provide a base for our growth."
 Net income for the six-month period ended April 30, 1993, was $1,802,000, or 14 cents per share, compared to a net loss of $1,174,000, or 9 cents per share for the first six months of 1992. The net loss for the six-month period ended April 30, 1992, included a restructuring charge of $2,257,000, or 18 cents per share.
 Revenues for the six-month period of 1993 were $109,847,000, an increase of 18 percent, compared to $92,949,000 for the corresponding period of 1992. The increase is attributable to product and service revenues from the Lundy operations, network integration revenues of Recognition's Canadian subsidiary and increased sales of Plexus(R) software products.
 At April 30, 1993, the company's total backlog of orders believed to be firm increased 48 percent to $47,523,000, compared to $32,063,000 at April 30, 1992. The increase is due primarily to orders received by Recognition's Canadian subsidiary for integrated network products, high- speed document processing products and XDR(TM) NetworkReaders(TM).
 Recognition, headquartered in Dallas, is a leading international open systems supplier of high-performance document recognition systems, image and workflow software, and related customer services.
 RECOGNITION INTERNATIONAL INC.
 Condensed Consolidated Statement of Operations
 (Unaudited)
 Three months ended April 30 1993 1992
 Revenues $60,819,000 $51,230,000
 Income before income taxes 3,178,000 28,000
 Provision for income taxes (1,992,000) (1,516,000)
 Net income (loss) 1,186,000 (1,488,000)
 Earnings (loss) per share $.09 $(.12)
 Six months ended April 30 1993 1992
 Revenues $109,847,000 $ 92,949,000
 Income before income taxes 4,782,000 2,089,000
 Provision for income taxes (2,980,000) (3,263,000)
 Net income (loss) 1,802,000 (1,174,000)
 Earnings (loss) per share $.14 $(.09)
 NOTE: The weighted average common shares outstanding for the six- month periods ended April 30 are: (1993) 13,212,000 and (1992) 12,658,000. The computations of fully diluted earnings per share are anti-dilutive and, therefore, are not reported.
 Consolidated Statement of Operations
 (Unaudited; thousands, except per share)
 Periods ended Three months Six months
 April 30 1993 1992(A) 1993 1992(A)
 Revenues:
 Product $31,727 $24,715 $52,500 $43,857
 Customer service 29,092 26,515 57,347 49,092
 Total 60,819 51,230 109,847 92,949
 Cost of revenues:
 Product 19,348 14,382 30,633 25,529
 Customer service 20,806 19,432 40,482 35,250
 Total 40,154 33,814 71,115 60,779
 Gross profit 20,665 17,416 38,732 32,170
 Operating expenses:
 Research and development 2,914 2,588 5,933 4,557
 Marketing 8,650 6,934 16,381 12,808
 General and administrative 3,651 3,512 6,771 6,732
 Restructuring -- 2,257 -- 2,257
 Other operating 1,835 1,972 3,517 3,280
 Operating income 3,615 153 6,130 2,536
 Interest income 614 988 1,140 2,376
 Interest expense (1,377) (1,296) (2,774) (2,491)
 Foreign exchange gains
 (losses), net 418 (117) 575 (474)
 Other income (expense), net (92) 300 (289) 142
 Income before income taxes 3,178 28 4,782 2,089
 Provision for income taxes (1,992) (1,516) (2,980) (3,263)
 Net income (loss) 1,186 (1,488) 1,802 (1,174)
 Weighted average shares 13,284 12,819 13,212 12,658
 Earnings (loss) per share $.09 $(.12) $.14 $(.09)
 (A) -- Certain items have been reclassified to conform to 1993 presentation.
 -0- 5/20/93
 /CONTACT: Larry H. Lattig of Recognition International Inc., 214-579-6314/
 (REC)


CO: Recognition International Inc. ST: Texas IN: SU: ERN

CK -- NY037 -- 0684 05/20/93 10:39 EDT
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