-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, AH5bqdwx6yQvAA/nhCrvAb5S2Hc7pwIvLFrfLuAPWhJZLYuw/K/rGXXbufeO07CL YazlE6IPUvupAgxhzejjbQ== 0000950144-04-001617.txt : 20040224 0000950144-04-001617.hdr.sgml : 20040224 20040224103639 ACCESSION NUMBER: 0000950144-04-001617 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040223 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20040224 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NUMEREX CORP /PA/ CENTRAL INDEX KEY: 0000870753 STANDARD INDUSTRIAL CLASSIFICATION: COMMUNICATIONS EQUIPMENT, NEC [3669] IRS NUMBER: 112948749 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-22920 FILM NUMBER: 04623635 BUSINESS ADDRESS: STREET 1: 1600 PARKWOOD CIRCLE STREET 2: SUITE 200 CITY: ATLANTA STATE: GA ZIP: 30339 BUSINESS PHONE: 6109412844 MAIL ADDRESS: STREET 1: 1400 N PROVIDENCE ROAD STE 5500 CITY: MEDIA STATE: PA ZIP: 19063 8-K 1 g87400e8vk.htm NUMEREX CORP. NUMEREX CORP.
Table of Contents

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 23, 2004

NUMEREX CORP.
(Exact Name of Issuer as Specified in Charter)
         
Pennsylvania   0-22920   11-2948749
 
 
(State or other
jurisdiction or
incorporation)		   (Commission File
Number) 		  (I.R.S. Employer
Identification No.)

1600 Parkwood Circle
Suite 200
Atlanta, Georgia
(Address of principal executive offices)

30339
(Zip code)

(770) 693-5950
(Registrant’s telephone number, including area code)

 

SIGNATURES
EX-99.1 PRESS RELEASE DATED FEBRUARY 23, 2004

Table of Contents

 
Item 7.    Financial Statements and Exhibits.

(c)   Exhibits

    99.1 Text of Press Release, dated February 23, 2004

 
Item 12.    Results of Operations and Financial Condition.

On February 23, 2004, Numerex Corp. issued a press release announcing its financial results for the fourth quarter and year ended December 31, 2003. The press release is furnished as Exhibit 99.1 hereto and incorporated herein by reference.

     
Exhibits    
   
99.1   Press Release dated February 23, 2004

 

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

  NUMEREX CORP.
(Registrant)

   

  /s/ Alan Catherall
Alan Catherall
Chief Financial Officer

Date: February 24, 2004

  EX-99.1 3 g87400exv99w1.txt EX-99.1 PRESS RELEASE DATED FEBRUARY 23, 2004 INVESTOR RELATIONS CONTACT: [NUMEREX LOGO] Alan B. Catherall 770-485-2527 PRESS RELEASE FOR IMMEDIATE RELEASE NUMEREX REPORTS FOURTH QUARTER AND FULL YEAR 2003 RESULTS COMPANY STRENGTHENS ITS FINANCIAL POSITION AS IT SUBSTANTIALLY NARROWS OPERATING LOSS CONTINUES WITH NEW PRODUCT LAUNCHES AND STRATEGIC MARKETING INITIATIVES ATLANTA, FEBRUARY 23, 2004 - NUMEREX CORP. (NASDAQ: NMRX), today announced a net loss of $400 thousand for the fourth quarter of 2003 and a full year net loss of $1.4 million. Included in these results is the gain on the sale of Data1Source LLC of $1.7 million that occurred in September 2003. These results compare to net losses of $3.8 million and $7.7 million for the comparable periods of 2002, including full year acquisition costs of $1.9 million. Fully diluted losses per share were $0.04 for the quarter and $0.13 year-to-date. This compares to fully diluted losses per share, including acquisition costs, of $0.35 and $0.71 for the comparable periods of 2002. Net sales were $5.3 million for the quarter and $20.2 million for 2003 in total compared to $3.9 million and $24.5 million for the comparable periods of 2002. Please see the attached financial statements for more details. "2003 was a very busy year for the Company," said Stratton Nicolaides, chairman and CEO of Numerex, "and the fourth quarter was no exception. In December, we announced the release of IPContact(R) 8.0, a desktop videoconferencing software package that boasts industry-leading performance levels with multi-point capabilities. IPContact supplements the Company's PowerPlay(TM) suite of turnkey videoconferencing hardware solutions. Our fourth quarter revenues included the initial sales of IPContact and we believe that this software package will gain further traction in 2004. Also, in December, we announced a strategic marketing initiative with Niigata Seimitsu and Toyota Industries Corporation to manufacture and distribute Numerex's extensive suite of product offerings, including Uplink(SM), MobileGuardian(TM) and VendView(TM). We are very excited to be allied with a company such as Niigata who are committed to providing Numerex with exceptionally high quality manufacturing and assembly resources." "We also continued to strengthen our financial position, and in January 2004, we issued a $4.5 million convertible Term Note. The net proceeds from the financing were used primarily for the repayment of the Company's remaining $3.5 million short-term debt to Cingular Wireless and to provide additional working capital. The Note is repayable in cash or, under certain circumstances, stock. During 2004, cash payments, if required, would be limited to just over $800,000, including interest." Other key initiatives undertaken in 2003 included: - - Launched the release of MobileGuardian(TM), a web-based vehicle location and recovery solution that combines the accuracy of Global Positioning System, or GPS, and Cellemetry(R) - - Completed the purchase of Cingular's 40% interest in Cellemetry LLC, a joint venture formed in 1998, giving Numerex full ownership of Cellemetry LLC and its subsidiary, Uplink Security Inc. - - Announced that Numerex's Australian subsidiary, DCX Systems, Inc., reached a five-year agreement with Telstra, a leading Australian telecommunications provider, to expand the availability of its Securitel service, a derived channel based alarm security service offered in Australia. - - Reached an exclusive agreement with the nations largest automotive dealership to market MobileGuardian(TM), providing point of sale access to over 400 dealership locations. - - Announced the sale of the our mobile messaging service bureau, Data1Source LLC, to Wireless Services Corporation, allowed us to focus our resources on growing our core wireless telemetry business. - - Added VendView(TM) to our wireless data solutions portfolio, a service providing remote monitoring of vending machines 24 hours a day, seven days a week, utilizing our Cellemetry(R) network for ubiquitous communications coverage throughout North America -continued- "Our financial results for the fourth quarter of 2003 included a 37% increase in revenues over the same period last year and we continued to focus on solid, creditworthy customers. Compared to the prior quarter, after eliminating revenues of $378,000 and $154,000, respectively, attributable to Data1Source LLC, total revenues increased slightly. However, this overall comparison masks the strong revenue performance of the Wireless Data Division, which recorded sequential growth of over 17% after eliminating revenues attributable to Data1Source LLC. Finally, with regard to liquidity, only the payment of accumulated interest to Cingular and fees related to the Data1Source transaction prevented the Company from adding to our cash balance reported at the end of September 2003. Our focus in 2004 will be sound revenue growth, continued cost control and aggressive cash management." A complete analysis of our 2003 quarterly revenues by division is included in this press release. CONFERENCE CALL AND WEBCAST INFORMATION Numerex will conduct a conference call tomorrow, February 24, 2004, at 11:00 A.M., Eastern Time, accessible by calling (877) 822-9907 in the U.S. and Canada, or (706) 679-7183 international. A live Webcast of the call will also be available via Numerex's Web site at http://www.nmrx.com, under the Investor Relations section. A replay of the conference call will be available via Numerex's Web site beginning two hours after the call. ABOUT NUMEREX Numerex (Nasdaq:NMRX) is a technology company comprised of operating subsidiaries that develop and market a wide range of communications products and services. The Company's primary focus is wireless data communications utilizing proprietary network technologies. The Company offers products and services in wireless data communications through Cellemetry(R), Uplink(TM), MobileGuardian(TM) and VendView(TM); and digital multimedia through PowerPlay(TM) and IPContact(TM). These services enable customers around the globe to monitor and move information for a variety of applications from home and business security to distance learning. In addition, the Company offers wireline alarm security products and services, as well as telecommunications network operational support systems. For more information on Numerex, please visit our Web site at: www.nmrx.com. This document contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements include, among other things, statements regarding trends, strategies, plans, beliefs, intentions, expectations, goals and opportunities. Forward-looking statements are typically identified by words or phrases such as "believe," "expect," "anticipate," "intend," "estimate," "assume," "strategy," "plan," "outlook," "outcome," "continue," "remain," "trend," and variations of such words and similar expressions, or future or conditional verbs such as "will," "would," "should," "could," "may," or similar expressions. All statements and information herein and incorporated by reference herein, other than statements of historical fact, are forward-looking statements that are based upon a number of assumptions concerning future conditions that ultimately may prove to be inaccurate. Many phases of the Company's operations are subject to influences outside its control. The Company cautions that these forward-looking statements are subject to numerous assumptions, risks and uncertainties, which may change over time. These forward-looking statements speak only as of the date of this report, and the Company assumes no duty to update forward-looking statements. Actual results could differ materially from those anticipated in these forward-looking statements and future results could differ materially from historical performance. Any one or any combination of factors could have a material adverse effect on the Company's results of operations or could cause actual results to differ materially from forward-looking statements or historical performance. These factors include: the pace of technological change; variations in quarterly operating results; delays in the development, introduction and marketing of new wireless products and services by us or our competitors or suppliers; delay in implementation by customers of services; changes in our mix of products and services and sources of revenues; changes in length of sales cycles of or demand by our customers for existing and additional services; changes in the productivity of our distribution channels; customer acceptance of our products and services;; the inability to attain revenue and earnings growth; loss of key strategic contracts; product failures; the introduction, withdrawal, success and timing of business initiatives and strategies; competitive conditions; the extent and timing of technological changes; changes in customer spending; the loss of intellectual property protection; an impact of changes in currently utilized telecommunications standards or Company's ability to adapt to such changes. Actual events, developments and results could differ materially from those anticipated or projected in the forward-looking statements as a result of certain uncertainties set forth below and elsewhere in this document. Subsequent written or oral statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the cautionary statements in this report and those in the Company's reports previously and subsequently filed with the Securities and Exchange Commission. -continued- NUMEREX CORP. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
FOR THE THREE MONTH FOR THE TWELVE MONTH PERIOD ENDED DECEMBER 31, PERIOD ENDED DECEMBER 31, 2003 2002 2003 2002 (UNAUDITED) (UNAUDITED) -------- -------- -------- -------- NET SALES: Wireless Data Communications $ 3,455 $ 1,689 $ 12,687 $ 14,209 Digital Multimedia and Networking 1,573 1,945 6,164 9,354 Wireline Data Communications 268 227 1,306 938 -------- -------- -------- -------- TOTAL NET SALES 5,296 3,861 20,157 24,501 Cost of sales 2,874 3,087 10,486 13,952 Depreciation and amortization 108 121 642 328 -------- -------- -------- -------- GROSS PROFIT 2,314 653 9,029 10,221 43.7% 16.9% 44.8% 41.7% Selling, general, and administrative expenses 2,094 3,297 8,922 12,509 Research and development expenses 59 369 905 1,097 Depreciation and amortization 454 564 1,928 2,184 Costs related to non-recurring acquisition activity -- -- -- 1,899 -------- -------- -------- -------- OPERATING LOSS (293) (3,577) (2,726) (7,468) Interest income and (expense), net (80) (84) (354) (212) Gain on sale of business -- -- 1,712 -- Other income and (expense), net (15) (58) 56 -- Minority interest -- -- -- 326 -------- -------- -------- -------- Loss before taxes (388) (3,719) (1,312) (7,354) Provision for income taxes 35 10 92 96 -------- -------- -------- -------- NET LOSS (423) (3,729) (1,404) (7,450) Preferred stock dividend -- 60 -- 240 -------- -------- -------- -------- NET LOSS APPLICABLE TO COMMON SHAREHOLDERS $ (423) $ (3,789) $ (1,404) $ (7,690) ======== ======== ======== ======== BASIC AND DILUTED LOSS PER COMMON SHARE $ (0.04) $ (0.35) $ (0.13) $ (0.71) Number of shares used in per share calculation Basic and diluted 10,790 10,973 10,934 10,766
-continued- NUMEREX CORP. CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS)
DECEMBER 31, DECEMBER 31, 2003 2002 ASSETS CURRENT ASSETS Cash and cash equivalents $ 734 $ 2,137 Accounts receivable, net 3,093 4,459 Notes Receivable 99 823 Inventory 3,461 5,189 Prepaid expenses and other current assets 700 976 -------- -------- TOTAL CURRENT ASSETS 8,087 13,584 PROPERTY AND EQUIPMENT, NET 1,296 2,475 GOODWILL, NET 15,014 10,983 OTHER INTANGIBLES, NET 7,979 8,050 SOFTWARE, NET 825 1,963 OTHER ASSETS 769 56 -------- -------- TOTAL ASSETS $ 33,970 $ 37,111 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 2,498 $ 5,238 Other current liabilities 1,487 1,866 Note payable, current 3,500 -- Deferred revenues 775 819 Obligations under capital leases, current portion 282 710 -------- -------- TOTAL CURRENT LIABILITIES 8,542 8,633 LONG TERM LIABILITIES Obligations under capital leases and other long term liabilities 62 863 -------- -------- TOTAL LONG TERM LIABILITIES 62 863 SHAREHOLDERS' EQUITY Preferred stock - no par value; authorized 3,000,000; none issued -- -- Class A common stock - no par value; authorized 30,000,000; issued 36,793 36,769 13,181,547 on December 31, 2003 and 13,168,889 on December 31, 2002 Additional paid-in-capital 439 439 Treasury stock, at cost, 2,391,400 shares on December 31, 2003 and (10,197) (9,222) 1,766,400 on December 31, 2002 Class B common stock - no par value; authorized 5,000,000; none issued -- -- Accumulated other comprehensive income 97 (9) Retained earnings (1,766) (362) -------- -------- $ 25,366 $ 27,615 -------- -------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 33,970 $ 37,111 ======== ========
-continued- QUARTERLY REVENUES BY PRODUCT OR SERVICE
THREE MONTHS ENDED ---------------------------------------------------- March 31, June 30, September 30, December 31, 2003 2003 2003 2003 ---------------------------------------------------- (in thousands, except per share data) Net sales: Wireless Data Communications Product $1,027 $1,073 $1,229 $1,509 Service 1,859 2,081 1,964 1,945 ------ ------ ------ ------ Sub-total 2,886 3,154 3,193 3,454 Digital Multimedia and Networking Product 504 395 944 803 Service 1,042 809 898 770 ------ ------ ------ ------ Sub-total 1,546 1,204 1,842 1,573 Wireline Security Product 39 172 173 65 Service 216 190 248 202 ------ ------ ------ ------ Sub-total 255 362 421 267 Total net sales Product 1,570 1,640 2,346 2,377 Service 3,117 3,080 3,110 2,917 ------ ------ ------ ------ Total net sales $4,687 $4,720 $5,456 $5,294 ====== ====== ====== ======
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