Global Technovations Reports Fiscal 2001 Third Quarter Results
PALM BEACH GARDENS, Fla.--Aug. 21, 2001--Global Technovations, Inc. (AMEX:GTN) or ("GTI", or the "Company") reported a net loss of $3,187,464 for the third fiscal quarter ended June 30, 2001 compared to a net loss of $ 1,430,928 for the same three-month period ended June 30, 2000. The net loss for the nine months ended June 30, 2001 was $10,196,072 compared to a net loss of $3,821,114 for the same nine-month period ended June 30, 2000. Results for fiscal year 2001's three and nine-month periods ended June 30, 2001 include operations of Onkyo America Inc. ("OAI") acquired on August 31, 2000. The net loss for the most recent three and nine-month periods includes approximately $1,417,000 and $4,169,000, respectively, of non-cash items such as amortization of goodwill, depreciation, and deferred interest. This compares to approximately $235,000 and $666,000 of non-cash items, respectively, for the same three month and nine-month periods ended June 30, 2000.Will Willis, President and CEO of Global Technovations, stated, "Despite our losses we've made significant progress this quarter on a number of fronts. Currently, the 10 units at Jiffy Lube International, Inc. ("Jiffy Lube") in Sacramento, California are working very well. By the end of August, we expect to have approximately 26 units in operation at Jiffy Lube with an additional 19 in transit. During the quarter ended June 30, 2001, our Boston OSA group recorded a significant sale of portable solid-state analyzers thus helping supplement our OSA product line offering. Finally, during this quarter, we've narrowed the loss at Onkyo and recently signed a purchase order with a Tier One supplier to an automotive OEM, that is expected to generate up to $18,000,000 in new sales during the next 24 months."
David Natan, GTI's Vice President and CFO, commented, "The strength of the Jiffy Lube contract and the initial purchase order for 154 units has created new financing visibility. During July, we completed a lease financing with a major lender. We expect to secure $3.5 million in additional financing by the end of August to fund operations and to continue the OSA Jiffy Lube rollout. Additionally, we are working on a financial restructuring to reduce our debt burden."
In closing, Mr. Willis further stated, " We are closely managing our Audio Strategic Business Unit through this difficult and unstable automotive industry period, while we aggressively implement our Diagnostic Divisions' market development plans. In addition to the Jiffy Lube contract, we continue to advance efforts on numerous additional initiatives. We are cautiously optimistic that one, and possibly two, major agreements comparable to Jiffy Lube's potential revenue will be executed and commenced before calendar year-end. Our business plan remains firmly on track to generate measurable results during the upcoming months. During the fourth calendar quarter of this year, we expect to show a significant improvement over current operating results."
GLOBAL TECHNOVATIONS, INC.
FINANCIAL TABLE
Three Months Ended Nine Months Ended
June 30 June 30
2001 2000 2001 2000
----------- ----------- ----------- -----------
Total Revenues $15,781,021 $ 311,097 $44,175,664 $794,650
Gross profit
(loss) 1,482,498 (151,039) 3,053,610 (362,334)
Loss from
operations (1,958,141) (1,447,827) (6,458,370) (3,963,628)
Net loss (3,187,464) (1,430,928) (10,196,072) (3,821,114)
Dividends and
warrants
related to
preferred stock (407,516) (78,750) (679,197) (543,786)
Net loss available
to common
shareholders (3,594,980) (1,509,678) (10,875,269) (4,364,900)
Basic and Diluted
Earnings (Loss)
Per Share
Net Loss $(.12) $(.05) $(.37) $(.15)
Weighted average
number of common
shares outstanding
- basic and
diluted 29,343,047 29,333,047 29,340,831 29,333,047
Forward-Looking Statements