TRAVERSE CITY, Mich., Sept. 8 /PRNewswire-FirstCall/ -- Versus Technology, Inc. announced revenues of $1,606,000 for the fiscal quarter ended July 31, 2005, 19% above the $1,355,000 revenues for the same period in 2004. Revenues for the nine months ended July 31, 2005, were $3,687,000 compared to revenues of $3,536,000 for the same period in 2004. Versus believes that sales volumes will continue to grow, but quarterly revenues can fluctuate significantly depending, in part, on the timing of delivery of larger orders.
Versus reported a loss of $60,000 for the quarter compared to a loss of $57,000 in the same period in 2004. The net losses for the nine-month periods ended July 31, 2005 and 2004, were $837,000 and $427,000, respectively. The increase in net loss during fiscal year 2005 is largely attributable to increases in sales and marketing expenditures and increases in allowance for doubtful accounts.
Versus ended the quarter with a cash balance of $1,365,000, up from $1,277,000 at the end of the second quarter 2005. Cash at the beginning of the year was $1,616,000.
For additional information please refer to the attached unaudited consolidated financial statements.
Versus pioneered asset tracking and locating systems in the healthcare field a decade ago and is now leading the way with the development of facility-wide context-aware medical asset management systems. To better respond to this growing market, the company recently restructured its management team. Day-to-day operations are now the focus of three highly qualified, experienced managers enabling Gary T. Gaisser, who continues in the role of Chief Executive Officer, to concentrate on the strategic direction of the company.
Henry J. Tenarvitz was appointed President - Mr. Tenarvitz joined Olmsted Engineering, a manufacturer of Computer Assisted Manufacturing software, in 1986 and served as President of Olmsted until he transferred to Versus as Executive Vice President of Operations when Versus acquired Olmsted in 1996. In 1999 he assumed responsibility for product development and manufacturing. As President, Mr. Tenarvitz is responsible for the day-to-day operations of the company including product development, fulfillment, sales and marketing activities, and will focus on increasing overall revenue.
H. T. Snowday III was appointed Vice President of Systems Development - Mr. Snowday joined Olmsted Engineering in 1989 and transferred to Versus when Versus acquired Olmsted in 1996. He has served in a number of senior management positions in the sales, marketing, and software development areas. Mr. Snowday has served as a technology consultant to several Fortune 500 companies and is an expert in the development and deployment of software automation systems. As Vice President of Systems Development, Mr. Snowday is responsible for new product and systems development and will focus on systems revenue generation.
Both Mr. Tenarvitz and Mr. Snowday have made significant contributions to the development of the company’s intellectual properties.
Gary T. Wittbrodt was appointed Director of Operations - Mr. Wittbrodt joined Olmsted Engineering in 1986 and transferred to Versus when Versus acquired Olmsted in 1996. He has held a number of senior management positions in the sales, marketing, and customer support areas. Most recently he served in the dual roles of Regional Sales Manager for Canada and Customer Support Manager. As Director of Operations, Mr. Wittbrodt is responsible for manufacturing, quality, fulfillment activities, and customer support, and will focus on revenue generation from related customer support activities. He will also continue in his Canadian sales role.
Versus Technology, Inc. (http://www.versustech.com ) (Versus) is the leader in the development and sale of context-aware systems used for the management of patient flow and medical assets and to improve caregiver/patient communications in medical and long-term care facilities. Versus also supplies Active RFID/IR tags and readers that make locating systems more precise, security systems more intelligent, data collection routines automatic, and asset management systems more efficient. Versus’ systems, which are currently installed in hospitals, corporate facilities, government facilities, and other complexes, permit the automatic and accurate registry of essential management and business information. By monitoring the precise location of personnel or equipment and automatically recording events associated with their locations, the systems offer real-time asset and staff locating, automatic data collection, access/egress control, and a passive source of location data that facilitates scheduling and communication interfaces. Versus’ proprietary locating systems are sold primarily through an expanding network of resellers and dealers.
Safe Harbor Provision
This document may contain forward-looking statements relating to future events, such as the development of new products, the commencement of production, or the future financial performance of the Company. These statements fall within the meaning of forward-looking information as defined in the Private Securities Litigation Reform Act of 1995. These statements are subject to a number of important risks and uncertainties that could cause actual results to differ materially including, but not limited to, economic, competitive, governmental, and technological factors affecting the Company’s markets and market growth rates, products and their rate of commercialization, services, prices and adequacy of financing, and other factors. The Company undertakes no obligation to update, amend, or clarify forward-looking statements, whether because of new information, future events, or otherwise.
Report of Management
The accompanying consolidated balance sheets of Versus Technology, Inc. and Subsidiary as of July 31, 2005, and October 31, 2004, and the related consolidated statements of operations and cash flows for the periods ended July 31, 2005 and 2004, have been prepared by management.
Statements for the periods ended July 31, 2004, have been restated for the Beneficial Conversion Feature of Debentures issued in April 2004. The reader should refer to the Versus Technology, Inc. 2004 Annual Report which is available at http://www.versustech.com/pages/annual_reports.aspx for further details.
Management has elected to omit substantially all of the footnote disclosures required by accounting principles generally accepted in the United States. If the omitted disclosures were included in the financial statements, they might influence the user’s conclusions about the Company’s financial position, results of operations, and cash flows. Accordingly, these financial statements are not designed for those who are not informed about such matters.
Robert Butler Chief Accounting Officer September 8, 2005 VERSUS TECHNOLOGY, INC. AND SUBSIDIARY Consolidated Statements of Operations (Unaudited) Three Months Ended July 31, Nine Months Ended July 31, 2005 2004 2005 2004 (As restated) (As restated) Revenues $1,606,000 $1,355,000 $3,687,000 $3,536,000 Operating Expenses Cost of revenues 706,000 551,000 1,522,000 1,580,000 Research and development 160,000 161,000 527,000 484,000 Sales and marketing 347,000 339,000 1,204,000 936,000 General and administrative 265,000 242,000 753,000 723,000 1,478,000 1,293,000 4,006,000 3,723,000 Income (Loss) From Operations 128,000 62,000 (319,000) (187,000) Other Income (Expense) Interest income 10,000 3,000 31,000 9,000 Interest expense (91,000) (72,000) (258,000) (173,000) Interest expense, accretion of debt discount (98,000) (58,000) (260,000) (58,000) Other, net (9,000) 8,000 (31,000) (18,000) (188,000) (119,000) (518,000) (240,000) Net Loss $(60,000) $(57,000) $(837,000) $(427,000) Basic and Diluted Net Loss Per Share $ - $ - $(0.02) $(0.01) See accompanying Report of Management. VERSUS TECHNOLOGY, INC. AND SUBSIDIARY Consolidated Balance Sheets (Unaudited) July 31, 2005 October 31, 2004 Assets Current Assets Cash and cash equivalents $1,365,000 $1,616,000 Accounts receivable (net of allowance for doubtful accounts of $264,000 and $88,000) 1,333,000 1,658,000 Inventories - purchased parts and assemblies 335,000 249,000 Prepaid expenses and other current assets 67,000 71,000 Total Current Assets 3,100,000 3,594,000 Property and Equipment Machinery and equipment 295,000 270,000 Furniture and fixtures 76,000 76,000 Leasehold improvements 157,000 157,000 528,000 503,000 Less accumulated depreciation 477,000 460,000 Net Property and Equipment 51,000 43,000 Goodwill 1,533,000 1,533,000 Patents and Other Intangible Assets, net of accumulated amortization of $1,746,000 and $1,625,000 244,000 365,000 Deferred Financing Costs, net of accumulated amortization of $122,000 and $118,000 12,000 16,000 Other non-current assets 9,000 9,000 $4,949,000 $5,560,000 See accompanying Report of Management. VERSUS TECHNOLOGY, INC. AND SUBSIDIARY Consolidated Balance Sheets (Unaudited) July 31, 2005 October 31, 2004 Liabilities and Shareholders’ Equity Current Liabilities Accounts payable $572,000 $402,000 Accrued expenses 262,000 314,000 Deferred revenue - customer advance payments 15,000 92,000 Total Current Liabilities 849,000 808,000 Long-Term Debt Series B Convertible Debentures 2,875,000 2,690,000 Total Liabilities 3,724,000 3,498,000 Commitments and Contingencies Shareholders’ Equity Common stock $0.01 par value; 75,000,000 shares authorized; 45,734,325 shares issued and outstanding 457,000 457,000 Additional paid-in capital 37,218,000 37,218,000 Accumulated deficit (36,450,000) (35,613,000) Total Shareholders’ Equity 1,225,000 2,062,000 $4,949,000 $5,560,000 See accompanying Report of Management. VERSUS TECHNOLOGY, INC. AND SUBSIDIARY Consolidated Statements of Cash Flows (Unaudited) For the nine months ended July 31, 2005 2004 (As restated) Operating Activities Net loss $(837,000) $(427,000) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Depreciation 17,000 19,000 Amortization of intangibles 125,000 193,000 Loss on disposal of fixed assets - 7,000 Interest expense - accretion of debt discount 260,000 58,000 Changes in operating assets and liabilities: Accounts receivable, net 325,000 (3,000) Inventories (86,000) (61,000) Prepaid expenses and other current assets 4,000 2,000 Accounts payable 170,000 53,000 Accrued expenses (52,000) 110,000 Deferred revenues - customer advance payments (77,000) 5,000 Net cash (used in) operating activities (151,000) (44,000) Investing Activities Additions to property and equipment (25,000) (16,000) Net cash used in investing activities (25,000) (16,000) Financing Activities Issuance of long-term debt - 1,000,000 Sale of common stock - 24,000 Repayment of long-term debt (75,000) (200,000) Net cash provided by (used in) financing activities (75,000) 824,000 Net Increase (Decrease) in Cash and Cash Equivalents (251,000) 764,000 Cash and Cash Equivalents, at the beginning of the period 1,616,000 778,000 Cash and Cash Equivalents, at the end of the period $1,365,000 $1,542,000 Supplemental Cash Flow Information Cash paid during the period for interest $239,000 $153,000 See accompanying Report of Management.
Versus Technology, Inc.
CONTACT: Investors
Web site: http://www.versustech.com/
