EX-99.1 2 v25250exv99w1.htm EXHIBIT 99.1 exv99w1
 

CONTACT: INVESTOR RELATIONS
Henry R. Mandell, Chairman
Spatializer Audio Laboratories, Inc.
investor@spatializer.com
SPATIALIZER AUDIO LABORATORIES, INC. REPORTS
THIRD QUARTER OPERATING RESULTS
          San Jose, Calif., November 14, 2006- Spatializer Audio Laboratories, Inc. (OTC Bulletin Board: SPAZ) today announced financial results for the third quarter ended September 30, 2006.
     Revenues decreased to $68,000 for the quarter ended September 30, 2006 compared to $271,000 for the quarter ended September 30, 2005, a decrease of 75%. Revenues were comprised of royalties pertaining to the licensing of Spatializer audio signal processing algorithms and circuit designs. Revenues in the nine months ended September 30, 2006 were $261,000, compared to revenues of $1,032,000 in the comparable period last year, a decrease of 75%. Revenues in the three and nine months ended September 30, 2006 decreased due to end of life of a mobile telephone license and the recognition, earlier in 2005, of deferred revenue on a royalty prepayment received in the third quarter of 2004.
     Net Loss was ($62,000) for the quarter ended September 30, 2006, $0.00 basic per share, compared to net income of $37,000, $0.00 basic and diluted per share, for the quarter ended September 30, 2005. Net loss in the nine months ended September 30, 2006 was ($297,000), ($0.01) basic per share, compared with net income of $104,000, $0.00 basic and diluted per share in the comparable period last year. The net loss in the three month and nine month periods resulted from decreased revenues and a general wind down of operations.
     At September 30, 2006, the Company had $273,000 in cash and cash equivalents as compared to $551,000 at December 31, 2005. The decrease in cash resulted primarily from the net loss. The Company had working capital of $277,000 at September 30, 2006 as compared with working capital of $560,000 at December 31, 2005.
     About Spatializer
     Spatializer Audio Laboratories Inc. is developer, licensor and marketer of next-generation audio technologies for the consumer electronics, computing and mobile communication markets. The company’s advanced audio technology is incorporated into consumer electronics audio and video products, PC and mobile phone handsets from several global brand leaders. Spatializer stock is traded on the OTC Bulletin Board under

 

 

the symbol: SPAZ. The company is headquartered in San Jose, CA, and representative offices throughout the Asia Pacific region. Further information may be obtained from the company’s web site, www.spatializer.com, Spatializer’s SEC filings, and by contacting the company’s Investor Relations Department at investor@spatializer.com.
Safe Harbor Act Statement Under the Private Securities Litigation Reform Act of 1995: Certain information in this press release are forward looking statements that are based on management’s belief, as well as assumptions made by, and information currently available to management. While the company believes that its expectations are based upon reasonable assumptions, there can be no assurances that the company’s financial goals will be realized. Numerous uncertainties and risk factors may affect the company’s actual results and may cause results to differ materially from those expressed in forward-looking statements made by or on behalf of the company. These uncertainties and risk factors include, but are not limited to the continued need for additional capital, loss of key personnel, dependence on new technology and intellectual property, dependence on the PC and consumer electronics industries, dependence on product shipments of third-party licensees, dependence on third-party technology integrators or chip suppliers, competition and pricing pressures, and other risks detailed from time to time in the company’s periodic reports filed with the Securities and Exchange Commission.
NOTE: Desper Products Inc. is a wholly owned subsidiary of Spatializer Audio Laboratories Inc. Spatializer® is a registered trademark of Desper Products Inc. All other trademarks are the property of their respective owners.

 

 

PART I. FINANCIAL INFORMATION
ITEM I. FINANCIAL STATEMENTS
SPATIALIZER AUDIO LABORATORIES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
                 
    September 30,     December 31,  
    2006     2005  
    (unaudited)          
ASSETS
 
                
Current Assets:
                
Cash and Cash Equivalents
   $ 272,985     $ 550,633  
Accounts Receivable, net
     69,572       155,233  
Prepaid Expenses and Deposits
     46,937       34,104  
 
            
Total Current Assets
     389,494       739,970  
 
                
Property and Equipment, net
     6,205       18,403  
Intangible Assets, net
     136,833       138,548  
 
            
Total Assets
   $ 532,532     $ 896,921  
 
            
 
                
LIABILITIES AND SHAREHOLDERS’ EQUITY
 
                
Current Liabilities:
                
Note Payable
     24,176       10,443  
Accounts Payable
     18,367       14,195  
Accrued Wages and Benefits
     2,341       48,095  
Accrued Professional Fees
     22,500       34,000  
Accrued Commissions
     42,202       31,917  
Accrued Expenses
     2,998       40,869  
 
            
Total Current Liabilties
     112,584       179,519  
 
                
Commitments and Contingencies
                
 
                
Shareholders’ Equity:
                
Common shares, $.01 par value, 65,000,000 shares authorized, 46,975,365 shares issued and outstanding at September 30, 2006 and December 31, 2005.
     469,772       469,772  
Additional Paid-In Capital
     46,430,030       46,430,030  
Accumulated Deficit
     (46,479,854 )     (46,182,400 )
 
            
Total Shareholders’ Equity
     419,948       717,402  
 
                
 
            
 
                
 
   $ 532,532     $ 896,921  
 
            
See notes to consolidated financial statements

 

 

SPATIALIZER AUDIO LABORATORIES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
                                 
    For the Three Month Period Ended     For the Nine Month Period Ended  
    September 30,     September 30,     September 30,     September 30,  
    2006     2005     2006     2005  
Revenues:
                                
Royalty Revenues
   $ 67,744     $ 270,914     $ 261,100     $ 1,031,777  
 
                                
 
                        
 
     67,744       270,914       261,100       1,031,777  
Cost of Revenues
     6,774       12,752       26,251       89,514  
 
                        
Gross Profit
     60,970       258,162       234,849       942,263  
Operating Expenses:
                                
General and Administrative
     122,210       116,539       371,343       457,463  
Research and Development
     —       62,068       157,740       244,717  
Sales and Marketing
     —       45,356       1,241       140,810  
 
                        
 
     122,210       223,963       530,324       842,990  
 
                        
Operating (Loss)
     (61,240 )     34,199       (295,475 )     99,273  
Interest and Other Income
     1,442       3,376       7,087       9,992  
Interest and Other Expense
     (2,000 )     (1,030 )     (4,266 )     (5,140 )
 
                        
 
     (558 )     2,346       2,821       4,852  
 
                        
Income (Loss) Before Income Taxes
     (61,798 )     36,545       (292,654 )     104,125  
Income Taxes
     —       —       (4,800 )     —  
 
                        
 
                                
Net Income (Loss)
   $ (61,798 )   $ 36,545     $ (297,454 )   $ 104,125  
 
                        
 
                                
Basic and Diluted Earnings Per Share
   $ (0.00 )   $ 0.00     $ (0.01 )   $ 0.00  
 
                        
Weighted Average Shares Outstanding
     48,763,383       46,975,365       48,763,383       46,975,365  
 
                        
See notes to consolidated financial statements
###