EX-99.1 2 d28443exv99w1.htm PRESS RELEASE exv99w1
 

Exhibit 99.1
(OLICOM LOGO)
Stock Exchange Announcement No. 9/2005
Copenhagen, Denmark
August 25, 2005
Olicom Reports First Half-year 2005 Results
Olicom A/S (Other OTC: OLCMF) today announced a net loss for the first half-year of 2005 of 21.0 million Danish kroner (“DKK”), or US$ 3.4 million. The loss per share was DKK 1.22, or US$ 0.20 per share. All amounts expressed in dollars are calculated at the June 30, 2005, rate of exchange between the US dollar and the Danish krone.
As of June 30, 2005, shareholders’ equity was DKK 197.4 million, or US$ 32.0 million corresponding to DKK 11.37 per share, or US$ 1.85 per share.
The result for the half-year is impacted by a negative adjustment of the value of the Company’s portfolio investments and by financial expenses related to the loan agreement entered in February 2005, while shareholders’ equity is positively impacted by the Company’s sale of treasury shares.
Effective 2004 Olicom also prepares consolidated financial statements in which Interactive Television Entertainment ApS (“ITE”) is consolidated. The consolidated financial statements show a loss for the half-year of DKK 27.9 million, or US$ 4.5 million and shareholders’ equity as of June 30, 2005, of DKK 156.9 million, or US$ 25.5 million. Olicom considers that the results of its venture investment activities are best reflected in the financial statements for Olicom A/S in which ITE and the other portfolio companies are included at market value.
During the half-year the portfolio companies’ development showed both positive and negative deviations.
During the half-year ITE launched a new generation of equipment for the Hugo-based TV-shows. The new technology significantly reduces the cost of producing the show and the technology also enables 3D scenes. The new systems are now being installed in China, Vietnam and other countries. ITE hopes that the systems will make it possible to increase the number of TV-stations airing the Hugo-show. The development of this year’s new Hugo-game, Agent Hugo, is expected to be completed for launch of the game in October. ITEs revenue during the half-year was somewhat below expectations, ITE expects though to show increased revenue for the full year.
During the half-year both Comlog, which markets fleet management systems for truck fleets, and Scalado, which provides software for camera phones, continued their revenue growth, and both companies will achieve significant revenue increases for the full year. In August Scalado completed a financing round from existing investors of DKK 4 million, or US$ 0.6 million. As announced earlier Olicom’s holding in Scalado has been transferred to a company jointly owned with IVS. This company participated in the funding round with cash secured from IVS’ subscription of new shares. IVS now holds approximately 20% of the jointly owned company.

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The positive customer interest for Hymite’s optical component technology continued throughout the half-year and prototype agreements have been signed with leading component manufacturer. For now the agreements only cover prototyping projects, but more of these projects may result in significant volume agreement. During the half-year Tpack, which delivers technology for telecommunications, experienced delays in closing expected sales orders, while Sifira, which develops messaging solutions for telecommunications operators, during the last part of the half-year saw an increase in booked orders especially in the Swedish market.
For the purpose of strengthening Olicom’s cash position the Company has during the half-year entered loan agreements with both private lenders and related parties. The loan agreements have total proceeds to the Company of DKK 15.6 million, or US$ 2.5 million. The reason for entering the loan agreements is, that customary bank facilities have proven not to be available to the Company.
For the full year Olicom now expects to report a loss in the order of DKK 25 million, or US$ 4.1 million assuming that it will not be necessary to write off portfolio investments and assuming that further significant write downs will not be made. The Company’s BOD will especially focus on the possibilities of strengthening the development in ITE and Sifira. Olicom is the sole investor in these two companies, which therefore represent a larger exposure. Olicom is actively pursuing exit sales of certain portfolio companies, but does not include such sales in its expected result.
Niels Kristian Agner joined Olicom’s BOD in April 2005 under the assumption that the Company would undertake a capital increase, that would allow follow-up and new investments. As such capital increase has not been planned Niels Kristian Agner has decided to leave the BOD.
For further information please contact Olicom CEO Boje Rinhart, tel. +45 4527 0000 or
e-mail bri@olicom.com.
Attachments
Summary of Income Statement and Balance Sheet follow.
About Olicom
Olicom invests in leading edge information technology and communication technology companies located in Scandinavia. The main office is located in the Øresund region and the US office is located in the Dallas Telecom Corridor in Richardson, Texas. Olicom is listed on the Copenhagen Stock Exchange and in the USA the company’s stock is traded on Other OTC, under the symbol OLCMF.
Further information about Olicom can be found at www.olicom.com or obtained by contacting CEO Boje Rinhart tel. +45 4527 0000 or e-mail bri@olicom.com.
Except for historical information contained herein, the matters discussed in this news release may contain forward-looking statements that reflect the Company’s current expectations and projections about its future results, performance, prospects and opportunities. These forward-looking statements are based on information currently available to the Company and are subject to a number of risks, uncertainties and other factors that could cause its actual results, performance, prospects or opportunities to differ materially from those expressed in, or implied by, these forward-looking statements. Among the risks, uncertainties and other factors that could cause results to differ are uncertain market conditions, the successful implementation of the Company’s new strategic direction; the Company’s need to continue to identify and acquire interests in suitable portfolio companies; intense competition among capital providers to acquire interests in technology companies; the dependence of the Company on the financial and operating success of the enterprises in which it invests or participates; and existing and future regulations affecting the Company’s business, the businesses of its portfolio companies or technology generally. Further information may be found in Olicom’s periodic filings with the U.S. Securities and Exchange Commission (SEC), including the most recent reports on Form 20-F and 6-K, which identify important risk factors related to the Company’s business that could cause actual results, performance, prospects or opportunities to materially differ from those contained in the forward-looking statements.

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Attachments – Summary of Income – Olicom A/S (Parent Company)
                         
    Six months  
    Ended June 30,  
    2004     2005     2005  
                    Convenience  
                    translation  
    DKK 1,000     USD 1,000  
    (unaudited)     (unaudited)     (unaudited)  
 
                        
Valuation adjustments, portfolio companies
     (6,000 )     (14,000 )   $ (2,272 )
 
                        
Gross profit
     (6,000 )     (14,000 )     (2,272 )
 
                        
Operating expenses
                        
General and administrative
     4,026       3,819       620  
Restructuring charges
     (47 )     (263 )     (43 )
Total operating expenses
     3,979       3,556       577  
 
                        
Income/(loss) from operations before interest and income taxes
     (9,979 )     (17,556 )     (2,849 )
 
                        
Interest income and other, net
     313       (3,453 )     (560 )
 
                        
Income/(loss) before income taxes
     (9,666 )     (21,009 )     (3,409 )
 
                        
Income taxes
     0       0       0  
 
                        
Net income/(loss)
     (9,666 )     (21,009 )   $ (3,409 )
 
                  
 
                        
Earnings/(loss) per share, basic
     (0.57 )     (1.22 )   $ (0.20 )
Earnings/(loss) per share, diluted
     (0.57 )     (1.22 )   $ (0.20 )
 
                        
Weighted average shares outstanding including common stock equivalents, basic
     16,938       17,253       17,253  
 
                        
Weighted average shares outstanding including common stock equivalents, diluted
     16,938       17,253       17,253  
The balance sheets and statements of income include a convenience translation for the most recent reporting period by applying the quarter-end exchange rate of DKK 6.1623 per US$ 1.00. This translation should not be construed to imply that the DKK amounts actually represent, or have been or could have been converted to, U.S. dollars

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Attachments – Summary of Balance Sheet – Olicom A/S (Parent Company)
                         
    December 31,     June 30,     June 30,  
    2004     2005     2005  
                    Convenience  
                    translation  
    DKK 1,000             USD 1,000  
    (audited)     (unaudited)     (unaudited)  
Assets
                        
 
                        
Investments, property and equipment, net
     34       17     $ 3  
Investments in portfolio companies
     83,649       70,796       11,489  
Investments in affiliated companies
     22,372       22,372       3,630  
Outstanding amounts, affiliated companies
     20,000       42,000       6,816  
Total fixed assets
     126,055       135,185       21,938  
 
                        
Long-term assets
     169       159       26  
 
                        
Accounts receivable
     951       22       4  
Outstanding amounts, affiliated companies
     21,351       6,502       1,055  
Outstanding amounts, portfolio companies
     61,366       64,114       10,404  
Prepaid expenses and other currents assets
     932       972       158  
Cash and cash equivalents
     11,016       12,825       2,081  
Total current assets
     95,616       84,435       13,702  
 
                  
 
                        
Total assets
     221,840       219,779     $ 35,666  
 
                  
 
                        
Liabilities and shareholders’ equity
                        
 
                        
Shareholders’ equity
     215,197       197,413     $ 32,036  
 
                        
Restructuring charges
     464       504       82  
Total provisions
     464       504       82  
 
                        
Other liabilities
     0       11,439       1,856  
Total long-term liabilities
     0       11,439       1,856  
 
                        
Accounts payable and accrued liabilities
     6,179       10,423       1,692  
Total current liabilities
     6,179       10,423       1,692  
 
                        
Total liabilities
     6,179       21,862       3,548  
 
                  
 
                        
Total liabilities and shareholders’ equity
     221,840       219,779     $ 35,666  
 
                  
The balance sheets and statements of income include a convenience translation for the most recent reporting period by applying the quarter-end exchange rate of DKK 6.1623 per US$ 1.00. This translation should not be construed to imply that the DKK amounts actually represent, or have been or could have been converted to, U.S. dollars

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Attachments – Investments in Portfolio Companies
Investments in Portfolio Companies as of June 30, 2005
                 
    Owner’s share (Non-diluted)     Investment (DKK 1,000)  
Danacell A/S
     16.7 %     1,229  
Decuma AB
     16.8 %     14,300  
Hymite A/S
     8.7 %     15,549  
ITE ApS
     100.0 %     22,373  
LH Comlog A/S
     22.5 %     12,500  
Scalado AB
     48.2 %     25,466  
Sifira A/S
     57.2 %     17,961  
Tpack A/S
     22.3 %     12,505  
Total investment
             121,883  
Valuation adjustments
             (28,715 )
Investments in portfolio companies
             93,168  

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Attachments – Summary of Income – The Group
                         
    Six months  
    Ended June 30,  
    2004     2005     2005  
                    Convenience  
                    translation  
    DKK 1,000     USD 1,000  
    (unaudited)     (unaudited)     (unaudited)  
 
                        
Net sales
     13,445       11,268     $ 1,829  
Production costs
     9,696       11,207       1,819  
 
                        
Valuation adjustments, portfolio companies
     (6,000 )     (14,000 )     (2,272 )
Gross result
     (2,251 )     (13,939 )     (2,262 )
 
                        
Operating expenses
                        
General and administrative
     3,200       2,949       479  
Sales and distribution
     9,151       7,536       1,223  
Restructuring charges
     (47 )     (263 )     (43 )
Total operating expenses
     12,304       10,222       1,659  
 
                        
Income/(loss) from operations before interest and income taxes
     (14,555 )     (24,161 )     (3,921 )
Interest income and other, net
     (5 )     (3,706 )     (601 )
Income/(loss) before income taxes
     (14,560 )     (27,867 )     (4,522 )
 
                        
Income taxes
     0       0       0  
 
                        
Net income/(loss)
     (14,560 )     (27,867 )   $ (4,522 )
 
                  
 
                        
Earnings/(loss) per share, basic
     (0.86 )     (1.62 )   $ (0.26 )
Earnings/(loss) per share, diluted
     (0.86 )     (1.62 )   $ (0.26 )
 
                        
Weighted average shares outstanding including common stock equivalents, basic
     16,938       17,253       17,253  
 
                        
Weighted average shares outstanding including common stock equivalents, diluted
     16,938       17,253       17,253  
The balance sheets and statements of income include a convenience translation for the most recent reporting period by applying the quarter-end exchange rate of DKK 6.1623 per US$ 1.00. This translation should not be construed to imply that the DKK amounts actually represent, or have been or could have been converted to, U.S. dollars

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Attachments – Summary of Balance Sheet – The Group
                         
    December 31,     June 30,     June 30,  
    2004     2005     2005  
                    Convenience  
                    translation  
    DKK 1,000     USD 1,000  
    (audited)     (unaudited)     (unaudited)  
Assets
                        
 
                        
Intangible fixed assets
     45,042       43,599     $ 7,075  
Investments, property and equipment, net
     607       896       145  
Investments in portfolio companies
     83,649       70,796       11,489  
Total fixed assets
     129,298       115,291       18,709  
 
                        
Long-term assets
     169       159       26  
 
                        
Inventory
     398       79       13  
 
                        
Accounts receivable
     5,984       2,838       461  
Outstanding amounts, portfolio companies
     61,366       64,114       10,404  
Prepaid expenses and other currents assets
     1,759       1,839       298  
Cash and cash equivalents
     11,184       12,871       2,089  
Total current assets
     80,293       81,662       13,252  
 
                        
Total assets
     210,158       197,191     $ 32,000  
 
                  
 
                        
Liabilities and shareholders’ equity
                        
 
                        
Shareholders’ equity
     181,539       156,897     $ 25,461  
 
                        
Restructuring charges
     464       504       82  
Total provisions
     464       504       82  
 
                        
Other liabilities
     0       11,439       1,856  
Total long-term liabilities
     0       11,439       1,856  
 
                        
Credit bank
     11,567       9,162       1,487  
Accounts payable and accrued liabilities
     16,588       19,189       3,114  
Total current liabilities
     28,155       28,351       4,601  
 
                        
Total liabilities
     28,155       39,790       6,457  
 
                        
Total liabilities and shareholders’ equity
     210,158       197,191     $ 32,000  
 
                  
The balance sheets and statements of income include a convenience translation for the most recent reporting period by applying the quarter-end exchange rate of DKK 6.1623 per US$ 1.00. This translation should not be construed to imply that the DKK amounts actually represent, or have been or could have been converted to, U.S. dollars

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