Exhibit 99.1
Investor Relations
eOn Communications
800-955-5321
investorrelations@eoncc.com
For Release 3:30 PM ET, June 13, 2011
eOn Communications Reports Third Quarter and Year-To-Date Results
CORINTH, MS (June 13, 2011) – eOn Communications Corporation™ (NASDAQ: EONC) (the “Company”), a leading provider of telecommunications solutions, today reported third fiscal quarter and year-to-date results for the period ended April 30, 2011.
Third quarter revenue increased 57% to $5,561,000 from $3,535,000 in the third quarter of last year, primarily due to the inclusion of Cortelco Systems Puerto Rico revenue in which majority ownership was acquired on June 9, 2010. Net income for the quarter was $131,000 or $0.05 per common share compared to net loss of $47,000 or $0.02 per common share in the quarter ended April 30, 2010. Operating results were favorably impacted by $59,000 of imputed interest income due to the amortization of the difference between the face value of the contingent obligation to the former Cortelco shareholders and the discounted present value of the note payable recorded on the balance sheet. Interest expense of $127,000 was offset by $186,000 of interest income resulting from changes in the estimated timing of future interest payments. Net income from continuing operations for the quarter excluding the impact of the imputed interest income was $72,000 or $0.03 per common share.
Revenue for the nine months was $17,111,000, an increase of 49% compared to $11,455,000 for the nine months ended April 30, 2010. Net loss for the nine months was $321,000 or $0.11 per common share, compared to a net income of $84,000 or $0.03 per common share for the nine months ended April 30, 2010. The net loss for the nine months ended April 30, 2011 included a loss from discontinued operations of $232,000 or $0.08 per common share. For the nine months ended April 30, 2011 excluding the impact of $229,000 in imputed interest expense, net income from continuing operations was $140,000 or $0.05 per common share.
Net loss for the nine months in the Company’s Communications and Services segment was partially offset by net income of $885,000 by the Company’s 100% owed subsidiary, Cortelco Systems Holding Company, and net income of $88,000 by the Company’s majority owned subsidiary, Cortelco Systems Puerto Rico.
Mr. David Lee, chairman of eOn’s Board of Directors noted, “Our favorable results for the quarter reflect the impact of our continuing cost reduction initiatives and we are striving to optimize revenue during these slow economic times.”
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About eOn Communications™
eOn Communications Corporation™ is a global provider of innovative communications solutions. Backed by over 20 years of telecommunications engineering expertise, our solutions enable our customers to leverage advanced technologies in order to communicate more effectively. To find out more information about eOn Communications and its solutions, visit www.eoncommunications.com, or call 800-955-5321.
Note:
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties, including technical and competitive factors, which could cause the Company’s results and the timing of certain events to differ materially from those discussed in the forward-looking statements. Such risks are detailed in eOn Communications Corporation’s most recent Form 10-K filing with the Securities and Exchange Commission.
eOn Communications Corporation, the mark eOn, and eQueue are trademarks of eOn Communications Corporation.
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eOn Communications Corporation
Condensed Consolidated Statements of Operations
(Dollars in thousands, except per share data)
Unaudited
| Three Months Ended April 30, |
Nine Months Ended April 30, |
|||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| REVENUE |
||||||||||||||||
| Net revenue |
$ | 5,561 | $ | 3,535 | $ | 17,111 | $ | 11,455 | ||||||||
| COST OF REVENUE |
||||||||||||||||
| Cost of revenue |
3,882 | 2,229 | 12,050 | 7,244 | ||||||||||||
| Gross profit |
1,679 | 1,306 | 5,061 | 4,211 | ||||||||||||
| OPERATING EXPENSE |
||||||||||||||||
| Selling, general and administrative |
1,413 | 995 | 4,405 | 3,173 | ||||||||||||
| Research and development |
121 | 141 | 391 | 395 | ||||||||||||
| Other expenses |
(1 | ) | 22 | 19 | 47 | |||||||||||
| Total operating expense |
1,533 | 1,158 | 4,815 | 3,615 | ||||||||||||
| Income from operations |
146 | 148 | 246 | 596 | ||||||||||||
| OTHER INCOME (EXPENSE) |
||||||||||||||||
| Interest income (expense), net |
56 | (149 | ) | (238 | ) | (499 | ) | |||||||||
| Equity in earnings of unconsolidated investee |
— | 2 | — | 51 | ||||||||||||
| Total other income (expense) |
56 | (147 | ) | (238 | ) | (448 | ) | |||||||||
| Income before income taxes |
202 | 1 | 8 | 148 | ||||||||||||
| Income tax expense (benefit) |
24 | 2 | 24 | (19 | ) | |||||||||||
| Net income (loss) from continuing operations |
178 | (1 | ) | (16 | ) | 167 | ||||||||||
| DISCONTINUED OPERATIONS |
||||||||||||||||
| Loss from discontinued operations |
— | (46 | ) | (232 | ) | (83 | ) | |||||||||
| Net income (loss) |
178 | (47 | ) | (248 | ) | 84 | ||||||||||
| Less: Net income attributable to noncontrolling interest |
47 | — | 73 | — | ||||||||||||
| Net income (loss) attributable to common shareholders |
$ | 131 | $ | (47 | ) | $ | (321 | ) | $ | 84 | ||||||
| COMPREHENSIVE (LOSS) INCOME |
||||||||||||||||
| Net income (loss) |
$ | 131 | $ | (47 | ) | $ | (321 | ) | $ | 84 | ||||||
| Unrealized gains on available-for-sale securities |
— | 1 | — | 5 | ||||||||||||
| Foreign currency translation adjustment |
— | — | 2 | — | ||||||||||||
| Comprehensive income (loss) |
$ | 131 | $ | (46 | ) | $ | (319 | ) | $ | 89 | ||||||
| Weighted average shares outstanding |
||||||||||||||||
| Basic |
2,862 | 2,756 | 2,859 | 2,743 | ||||||||||||
| Diluted |
2,864 | 2,756 | 2,859 | 2,745 | ||||||||||||
| Basic income (loss) per share: |
||||||||||||||||
| From continuing operations |
$ | 0.05 | $ | — | $ | (0.03 | ) | $ | 0.06 | |||||||
| From discontinued operations |
— | (0.02 | ) | (0.08 | ) | (0.03 | ) | |||||||||
| Basic income (loss) per share |
$ | 0.05 | $ | (0.02 | ) | $ | (0.11 | ) | $ | 0.03 | ||||||
| Diluted income (loss) per share: |
||||||||||||||||
| From continuing operations |
$ | 0.05 | $ | — | $ | (0.03 | ) | $ | 0.06 | |||||||
| From discontinued operations |
— | (0.02 | ) | (0.08 | ) | (0.03 | ) | |||||||||
| Diluted income (loss) per share |
$ | 0.05 | $ | (0.02 | ) | $ | (0.11 | ) | $ | 0.03 | ||||||
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eOn Communications Corporation
Condensed Consolidated Balance Sheets
(Dollars in thousands, except share and per share amounts)
| April 30, 2011 |
July 31, 2010 |
|||||||
| (unaudited) | ||||||||
| ASSETS |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 1,847 | $ | 4,108 | ||||
| Trade accounts receivable, net of allowance of $339 and $235, respectively |
4,040 | 4,168 | ||||||
| Trade accounts receivable—related party |
— | 8 | ||||||
| Inventories |
5,798 | 4,948 | ||||||
| Prepaid and other current assets |
316 | 257 | ||||||
| Total current assets |
12,001 | 13,489 | ||||||
| Property and equipment, net |
236 | 279 | ||||||
| Intangibles, net |
927 | 847 | ||||||
| Investments |
990 | 990 | ||||||
| Total assets |
$ | 14,154 | $ | 15,605 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY |
||||||||
| Current liabilities: |
||||||||
| Trade accounts payable |
$ | 2,181 | $ | 2,361 | ||||
| Notes payable—related party |
594 | 674 | ||||||
| Accrued expenses and other |
1,520 | 1,977 | ||||||
| Total current liabilities |
4,295 | 5,012 | ||||||
| Notes payable—related party, net of current portion |
3,104 | 3,647 | ||||||
| Total liabilities |
7,399 | 8,659 | ||||||
| Commitments and contingencies |
||||||||
| Stockholders' equity: |
||||||||
| Preferred stock, $0.001 par value, (10,000,000 shares authorized, no shares issued and outstanding) |
— | — | ||||||
| Common stock, $0.005 par value (10,000,000 shares authorized, 3,003,985 and 2,989,269 shares issued, respectively) |
15 | 15 | ||||||
| Additional paid-in capital |
56,273 | 56,269 | ||||||
| Treasury stock, at cost (139,580 shares) |
(1,503 | ) | (1,503 | ) | ||||
| Accumulated deficit |
(48,710 | ) | (48,389 | ) | ||||
| Accumulated other comprehensive income |
112 | 110 | ||||||
| Total eOn Communications Corp. stockholders' equity |
6,187 | 6,502 | ||||||
| Noncontrolling interest |
568 | 444 | ||||||
| Total stockholders' equity |
6,755 | 6,946 | ||||||
| Total liabilities and stockholders' equity |
$ | 14,154 | $ | 15,605 | ||||
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