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ZOOM TELEPHONICS, INC. ANNOUNCES SALES AND EARNINGS

 BOSTON, Oct. 29 /PRNewswire/ -- Zoom Telephonics, Inc. (NASDAQ-NMS: ZOOMF) today announced sales and earnings for the third quarter and first nine months of 1993.
 Zoom Telephonics, Inc.
 Quarter 3 to September 30
 1993 1992
 Sales $11,201,783 $11,156,939
 Net Income 384,370 1,030,210
 Share Earnings $.06 $.18
 Nine Months to September 30
 1993 1992
 Sales $39,547,512 $29,699,245
 Net Income 2,764,185 2,585,126
 Share Earnings $.46 $.45
 During September the company experienced a significant interruption of V.32bis faxmodem shipments as it transitioned to new lower-cost models. The company began high-volume shipment of these new models in late September, and ended the quarter with a large backlog.
 During the quarter Zoom began shipping faxmodems capable of handling voice recording and playback for voice mail, voice information delivery, and other advanced voice/fax/data applications.
 Zoom recently received a large stocking order for sale of Zoom/FaxModems in over 900 Wal-Mart locations.
 During the fourth quarter of 1993 Zoom will begin shipping the greatest number of new products in its history, including V.Fast Class 24,000 bps faxmodems, high-speed voice faxmodems, and high-speed pocket and Powerbook faxmodems.
 Zoom's third quarter sales were about equal to the prior year's quarter. Nine-month sales were a record, 33 percent higher than the first nine months of 1992.
 Gross margin was 21.8 percent of sales for the third quarter of 1993, down from 28.0 percent in the third quarter of 1992 and 25.9 percent in the second quarter of 1993.
 Gross margin for the first nine months of 1993 was 24.1 percent, vs. 27.9 percent for the first nine months of 1992. The margin decline was due primarily to a higher mix of OEM sales, which are characterized by lower margins and lower selling expenses, and to margin declines for V.32bis faxmodems during the third quarter of 1993. V.32bis faxmodem selling prices declined faster than costs, and the problem was exacerbated by delays in shipping the company's new lower-cost models.
 Total operating expenses for the first nine months of 1993 were 12.9 percent of sales, down from 13.5 percent for the first nine months of 1992. Operating expenses were 16.3 percent of sales for the third quarter of 1993, up from 12.6 percent for the third quarter of 1992 and 11.8 percent for the second quarter of 1993. Zoom's 23.7 percent quarter-to-quarter sales decline caused operating expense ratios to rise even though operating expenses only rose 5.7 percent quarter-to-quarter.
 Net income for the third quarter of 1993 was 3.4 percent of sales, down from 9.2 percent for the third quarter of 1992 and 8.5 percent for the second quarter of 1993. This was due to the sales shortfall and margin decline described above. Net income for the first nine months of 1993 was 7.0 percent of sales, versus 8.7 percent for the prior year's nine months.
 Zoom's balance sheet remained strong. The current ratio rose from 4.04 to 4.14 during the third quarter of 1993. Accounts receivable declined $1,373,631 to $5,067,195, and inventory increased $415,612 to $7,423,311. Bank debt remained at zero, and cash increased from $3,477,869 to $4,281,935.
 For additional information please contact Zoom Telephonics, 207 South Street, Boston, MA 02111, telephone 617-423-1072.
 -0- 10/29/93
 /CONTACT: Maryann Veronesi of Zoom Telephonics, 617-423-1072/
 (ZOOMF)


CO: Zoom Telephonics, Inc. ST: Massachusetts IN: CPR SU: ERN

DD -- NE015 -- 8734 10/29/93 17:43 EDT
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Publication:PR Newswire
Date:Oct 29, 1993
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