FREMONT, Calif.--Jan. 12, 1996--Oryx Technology
Corporation today reported operating results for the three and nine
month periods ended November 30, 1995.
"For the quarter, we are pleased to report record revenues
primarily due to a significant increase in volume shipments of our
Power Products unit," said Arvind Patel, chief executive officer of
Oryx. "This sales gain, however, was offset by higher than expected
raw material costs. In the future, we hope to offset the impact of
these costs through improved purchasing and internal efficiencies.
During the quarter, we shipped the first two IMCS 11100 units to
potential customers and received a $4 million contract manufacturing
commitment for our Reynosa plant."
RECORD REVENUES REPORTED FOR THIRD QUARTER
For the third quarter, revenues increased over 43 percent to
$4.7 million, up from $3.3 million in the third quarter last year.
Oryx reported an operating loss for the quarter of $998,000 compared
to an operating loss of $384,000 in the third quarter a year ago.
After the preferred dividend payment, the net loss for the quarter
was $1.1 million, or ($0.18) per share on 5.9 million weighted
average common shares outstanding compared with a net loss in the
same period a year ago of $390,000, or ($0.12) per share on 3.3
million weighted average common shares outstanding.
The record sales gain was primarily due to increased shipments
of Power Product units to a leading OEM customer. The company
expects revenue growth to accelerate due to their $4 million
contract manufacturing commitment from Display Technologies
Electrohome, product acceptance of their IMCS 11000 units, as well
as commencement of shipments of the TTS-1000 and TTS-2000 secondary
ion mass spectrometer (SIMS) systems.
Gross margins for the quarter were lower than expected
primarily
due to higher raw material costs in the Power Products division.
The company hopes to control the impact of these costs through
improved purchasing, increased operating efficiencies and by price
increases. However, at this time there can be no certainty that the
company will be able to improve its gross margins. The company also
continues to incur a high level of research and development and
sales and marketing expenditures associated with product development
and roll out of its new products.
SALES UP OVER 50 PERCENT FOR THE NINE MONTHS
For the nine months ended November 30, 1995, net sales increased
nearly 51 percent to $11.5 million, up from $7.6 million in the same
period in fiscal 1994. The sales increase was primarily due to
increased sales from the Power Products Group. Oryx reported that
the operating loss for the nine months decreased to $2.2 million
from $2.4 million in the year ago period. After the preferred
dividend payment, the net loss for the nine months ended November
30, 1995 was $2.3 million, or ($0.41) per share on weighted average
common shares on 5.7 million shares outstanding, compared to a loss
of $2.7 million, or ($0.86) per share on 3.1 million shares
outstanding for the comparable nine months ended November 30, 1994.
COMPANY SECURES INCREASED LINE OF CREDIT
The Company also announced that it has accepted a proposal for a
new line of credit of up to $2 million from Coast Business Credit, a
division of Southern Pacific Thrift and Loan Association. This line
of credit agreement will replace the company's current $750,000
agreement with Comerica Bank. In January 1996, the Company entered
into a forbearance agreement with Comerica Bank under the terms of
which the bank waived default in consideration of the Company's
replacing the line of credit with a third on or before February 28,
1996. In addition, Oryx is pursuing private placement financing for
up to $4 million. Net proceeds will be used to fund general
operations.
"Looking ahead, we are pleased with the market interest in our
products, particularly IMCS 11000 and the TTS 2000 units,"
continued Patel. "In addition, we are very enthusiastic about the
internal restructuring we are undertaking to implement a subsidiary
structure with each of our core business units. We believe that
this strategy, which more closely aligns compensation to
performance, will improve the focus and execution of our product
development and commercialization programs. This program also
underscores our commitment to enhanced profitability and stockholder
value," Patel concluded.
Headquartered in Fremont, California, Oryx Technology
Corporation is a technology management company with a proprietary
portfolio of high technology products in surge protection, power
supplies and specialized materials and materials analysis. The
company's customers include key OEMs in the fast growing information
industry: IBM, Xerox, Pitney Bowes and Seagate Technology. Oryx's
common stock trades on the Nasdaq Small Cap Issues Market under the
symbol Oryx.
ORYX TECHNOLOGY CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
Three Months Ended Nine Months Ended
November 30, November 30,
1995 1994 1995 1994
Revenue $4,713,000 $3,283,000 $11,516,000 $7,639,000
Cost of sales 3,887,000 2,159,000 8,855,000 5,262,000
Gross profit 826,000 1,124,000 2,661,000 2,377,000
Operating expenses:
Marketing
and selling 438,000 304,000 1,115,000 762,000
General and
administrative 608,000 511,000 1,788,000 1,248,000
Research and
development 778,000 612,000 1,914,000 1,504,000
Write off of
purchased research
and development - - - 1,275,000
Total operating
expenses 1,824,000 1,427,000 4,817,000 4,789,000
Income (loss)
from operations (998,000) (303,000) (2,156,000)
(2,412,000)
Interest
expense, net 22,000 34,000 60,000 114,000
Equity in losses
of investee 28,000 47,000 131,000 130,000
Income (loss) before
income taxes (1,048,000) (384,000) (2,347,000)
(2,656,000)
Net
income(loss) (1,048,000) (384,000) (2,347,000)
(2,656,000)
Preferred stock
dividend (4,000) (6,000) (10,000)
(22,000)
Net income (loss)
attributable to
common stock ($1,052,000) ($390,000) ($2,357,000)
($2,678,000)
Net income (loss)
per common share ($0.18) ($0.12) ($0.41)
($0.86)
Weighted average
common shares and
equivalent
outstanding 5,886,987 3,337,822 5,724,415 3,115,671
ORYX TECHNOLOGY CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED)
November 30, February 28,
1995 1995
ASSETS
Current assets:
Cash $ 0 $ 1,376,000
Accounts receivable, net of allowance
for doubtful accounts
of $252,000 and $213,000 1,920,000 2,520,000
Inventories 3,733,000 2,795,000
Other current assets 147,000 65,000
Total Current Assets 5,800,000 6,756,000
Property and equipment, net 1,294,000 879,000
Investments 106,000 186,000
Intangible assets, net 208,000 294,000
Other assets 185,000 140,000
$ 7,593,000 $ 8,255,000
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion
of long term debt 2,354,000 817,000
Accounts payable 1,909,000 1,303,000
Accrued liabilities 797,000 957,000
Total current liabilities 5,060,000 3,077,000
Long term debt
less current portion 0 1,451,000
Total liabilities 5,060,000 4,528,000
Stockholders' equity: 2,533,000 3,727,000
$ 7,593,000 $ 8,255,000
ROCHESTER, N.Y., Jan. 12, 1996 -- Harris Beach &
Wilcox,
one of New York State's largest and oldest law firms, is pleased to
announce its recent merger with the New York City based law
practices of O'Connor Reddy & Seeler, P.C., effective January 1,
1996. As a result of the merger, in addition to New York City,
Harris Beach has added offices in Hackensack, New Jersey and
Stamford, Connecticut, as well as increased its presence in
Washington, D.C. This merger allows Harris Beach to expand its
geographic reach and offer a full breadth of legal services to its
clients throughout New York State and the tri-state area. The
merger has also strengthened the firm's banking, international and
intellectual property practices. O'Connor Reddy & Seeler will
assume the name of Harris Beach & Wilcox.
Since 1991, the Rochester-based law firm has followed a strategy
to meet its clients' statewide needs by opening offices in Albany,
Buffalo, and Syracuse, as well as maintaining offices in Ithaca and
Washington, D.C. New York City represents the last link of the
"thruway" expansion plan. Harris Beach will continue to develop the
new offices to support the evolving needs of the firm's clients.
"We've found that many of our clients have expanded
geographically. In order to best serve the needs of these clients,
we must continue to be accessible to them. In addition, our
expansion has better positioned us to explore opportunities with
potential clients outside of the Rochester area," said Gunther K.
Buerman, Managing Partner of Harris Beach & Wilcox. "We are
delighted to be able to offer our clients a New York City location
while maintaining our upstate rate structure."
O'Connor Reddy & Seeler represent a variety of institutional
clients, multinational corporations, banks and banking institutions
(both foreign and domestic), and foreign governments. Attorneys in
the firm practice in most areas of commercial and banking law,
including commercial litigation, corporate law, real estate,
bankruptcies and creditor's rights, commercial contracts, maritime
law, environmental law, arbitration, taxation, corporate financing,
and aviation law. The firm has a significant international practice
and has affiliate law firms in: Copenhagen, Denmark; Oslo and
Kristiansund, Norway; Livorno, Italy; London, England; and Paris,
France.
"The merger with Harris Beach offers our clients expanded
resources and services," said William M. O'Connor, Managing Partner
of the New York City office. "Harris Beach has an excellent
reputation and we found that we have common philosophies related to
the practice of law. We look forward to a successful integration and
the growth opportunities which this merger will bring to our
practice."
Harris Beach & Wilcox, LLP founded in 1856, is a full-service
law firm with more than 160 attorneys. The firm is highly
recognized in the areas of corporate, commercial banking,
international, environmental, public finance, financial
restructuring and bankruptcy, litigation, antitrust, health care,
labor and employment law, commercial real estate, as well as for
handling sophisticated tax issues.
The firm's attorneys have a wide breadth of experience, from
managing all legal aspects of Fortune 500 companies' operations, to
working with emerging and family-owned businesses and their special
needs. There is also an extensive part of the firm's practice
focused on the needs of the individual, including the areas of
adoption, matrimonial and family law, tax planning, estate planning,
personal injury, discrimination, and criminal matters.
/CONTACT: Hilary C. Guthrie, Director of Business Development
and Communications, or Gunther K. Buerman, Managing Partner,
716-232-4440; or William O'Connor, Managing Partner of the New York
City
Office, 212-687-0100, all of Harris Beach & Wilcox/
NEW YORK, Jan. 12, 1996 -- Isetan of America,
Inc. (IOA),
100% subsidiary of Isetan, a major retailer in Japan, today
announced it is filing a suit against Mr. Robert Pressman and his
brother, Mr. Gene Pressman, owners of href="chap11.barneys.html">Barney's Inc., seeking
recovery of approximately $168 million of short-term loans by IOA to
the Preen affiliate of Barney's that were personally guaranteed by
the Pressman brothers and are now in default.
The suit being filed in the New York Supreme Court here today
was precipitated by the Chapter 11 filing late Wednesday by Barney's
Inc. and its affiliated companies, seeking protection of the
Bankruptcy Court, according to Mr. Yasuo Okamoto of Hughes Hubbard &
Reed, IOA's law firm here.
"These loans by Isetan were personally guaranteed by the
Pressman brothers," Mr. Okamoto said. Isetan is Japan's sixth
largest department store.
Mr. Okamoto said Preen is also in default on these separate
short- term loans made in 1993 and 1994 by IOA to the Barney's
affiliate to cover cost overruns and other capital needs related to
the construction of two retail stores in New York and Beverly Hills.
IOA owns three of the Barney's major retail locations. The other is
in Chicago.
Barney's management asked IOA for emergency short-term loans
primarily to cover the cost overruns. Upon consultation with
financial and legal advisors, IOA agreed to provide the loans in
exchange for individual guarantees from the Pressman brothers and
Barney's representations as to the substantial financial worth of
Preen, as well as various collateral and other considerations.
Mr. Okamoto said Preen defaulted on the emergency short-term
loans beginning in March of 1995. Barney's Inc. also is in default
of rental payments due on the retail properties owned by IOA
entities. These rental payments are believed to be related to the
law suit against Isetan announced by Barney's on Thursday.
At a meeting in Japan at the end of November, Mr. Robert
Pressman reported to Isetan that Barney's had been incurring
significant losses on an operational basis for some time. That
disclosure contradicted all previous financial information to Isetan
by Barney's Inc., reporting consecutive quarterly profitability, Mr.
Okamoto said.
The original agreement between Isetan and Barney's Inc. involved
several specific responsibilities in the U.S. and Japan, calling for
limited real estate investments by Isetan. It was never an open-
ended global business expansion partnership, Mr. Okamoto said.
Speaking on behalf of Isetan management, he said "we regret the
less than candid manner in which the management of Barney's Inc. has
communicated with us about the financial condition of their company.
We now must use all legal methods available to us under the
agreements and vigorously protect the interest of IOA, Isetan and
its shareholders in the bankruptcy proceedings."
/CONTACT: Yasuo Okamoto of Hughes Hubbard & Reed, 212-837-6760; or
Bill Cox of Dentsu Burson-Marsteller, 609-896-3250/
TROY, Mich., Jan. 12, 1996 -- Kmart Corporation
(NYSE: KM)
today said that Standard & Poor's decision to downgrade the
Company's senior debt rating to "BB" from "BBB" is "excessively
severe."
In a statement, Kmart Chairman, President and CEO, Floyd Hall said:
"This action by Standard & Poor's is unwarranted. We are
working aggressively to improve financial performance by
strengthening our merchandising and store operations.
"While we are disappointed with the rating, this action will not
interfere with our efforts to effectively pursue a turnaround
strategy and explore additional financial alternatives to enhance
our liquidity and financial flexibility. Kmart's new management
team is fully committed to these plans which have the support of our
principal banks, insurance companies, factors, vendors, employees
and customers.
"As announced yesterday, the requisite banks have agreed in
principle to the elimination of the put provisions on approximately
$550 million of real estate debt and to extend the terms of certain
of Kmart's revolving credit facilities. Kmart also has obtained
signatures from all 22 of the non-bank institutions required to
eliminate these puts. Pending closing, the downgrade-related
provisions on this real estate debt are substantially eliminated.
As a result of these agreements in principle, Kmart does not expect
that the action by the rating agency will have any immediate
material effect on the Company."
Kmart Corporation serves America with more than 2,163 Kmart and
169 Builders Square retail outlets in all 50 states, Puerto Rico,
the U.S. Virgin Islands and Guam. Kmart International operations
extend to Canada, the Czech Republic, Slovakia, and through joint
ventures, to Mexico and Singapore.
/CONTACT: Robert M. Burton, Director, Investor Relations,
810-643-1040, or Mary Lorencz, Director, Media Relations, 810-643-
1021,
both of Kmart/
LATHAM, N.Y.--Jan. 12, 1996--Mechanical
Technology Incorporated (MTI) has announced financial and operating
results for the 1995 fiscal year which ended on September 30.
The company also announced that it has reached agreement with
its primary lenders on the terms of a debt restructuring.
Sales for the year ended Sept. 30, 1995 were $29,748,000
compared with $40,234,000 for the prior year. The decrease in sales
was entirely attributed to the sale of MTI's subsidiary, ProQuip
Inc., during the first quarter of fiscal 1995. Excluding ProQuip,
sales increased $2,161,000 or 9% in 1995 compared to 1994.
Reported 1995 net income totaled $2,922,000 or 82 cents per
share compared with a net loss of $24,378,000 or ($6.91) per share
in 1994. Earnings for 1995 include a $6,779,000 gain on the sale of
ProQuip offset by a write-off of goodwill of $1,590,000 associated
with the carrying value of MTI's investment in its subsidiary in
Anaheim, Calif., Ling Electronics Inc. Prior year earnings include
a $24,519,000 net loss from discontinued operations due to the
voluntary bankruptcy of the company's United Telecontrol Electronics
Inc. subsidiary and a $1,152,000 (after tax) gain on the sale of a
building.
Sales for the fourth quarter of fiscal year 1995 were $7,118,000
with a net loss of $3,355,000 (including the $1,590,000 write-off of
goodwill) compared to 1994 sales of $14,870,000 (including
$8,204,000 from ProQuip) with a net loss of $4,236,000 (including a
net loss from discontinued operations of $4,341,000 and net income
from ProQuip of $2,112,000). Excluding ProQuip, fourth quarter
sales increased by $452,000 or 7% in 1995 compared to 1994.
The company has also announced that it has reached agreement
with its primary lenders to extend the terms of its outstanding
debt. Maturities on the term loan with Chase Manhattan Bank and the
line of credit with Chemical Bank have been extended through Oct.
31, 1998. The company has also negotiated a one year extension of
its note payable through Dec. 31, 1996, and continues to seek a more
permanent restructuring of this obligation.
MTI provides contract technology development and engineering
services and is a manufacturer of advanced products for the test and
measurement markets. The company was founded in 1961 and is
headquartered in Latham. The company's stock trades on the Over the
Counter Exchange and is listed under the symbol MTIX on the "pink
sheets."
Mechanical Technology Inc.
Consolidated Financial Summary
(Amounts, other than per share, are in thousands)
Operating Results
Three Months Ended Twelve Months Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
1995 1994 1995 1994
Sales $7,118 $14,870 $29,748 $40,234
Income (loss) from
continuing
operations (a) (3,355) 105 2,922 141
Income (loss) from
discontinued
operations 0 (4,341) 0 (24,519)
Net income (loss) $(3,355) $(4,236) $2,922 $(24,378)
Earnings (loss) per
share:
Continuing
operations $(0.94) $ 0.03 $ 0.82 $ 0.04
Discontinued
operations 0.00 (1.23) 0.00 (6.95)
Net income (loss) $(0.94) $(1.20) $ 0.82 $(6.91)
Average shares
outstanding 3,566 3,529 3,560 3,530
Financial position
As of
Sept. 30, 1995 Sept. 30, 1994
Cash $ 78 $ 1,820
Current assets 11,566 20,155
Total assets $14,483 $25,317
Current liabilities $10,972 $28,743
Long-term debt 6,222 2,144
Total liabilities 17,973 31,735
Net worth (3,490) (6,418)
Total liabilities and
net worth $14,483 $25,317
(a) Results for the three and twelve months ended Sept. 30, 1995
include a $1,590,000 impairment loss on the carrying value of the
company's Ling subsidiary. Also, the results for twelve months
ended Sept. 30, 1995 include the gain on sale of the company's
ProQuip subsidiary sold in November 1994 of $6,779,000. Results for
twelve months ended Sept. 30, 1994 include the gain (after tax) on
the sale of a building sold in November 1993 of $1,152,000.
CHICAGO, Jan. 12, 1996 -- Duff and Phelps Credit
Rating
Company (DCR) has assigned a 'BB-' (Double-B-minus) rating to $1
billion of first mortgage bonds to be issued by href="chap11.elpaso.html">El Paso Electric
Company (ELPAQ) upon its emergence from bankruptcy. ELPAQ's
proposed plan for reorganization was approved by the federal
bankruptcy court January 9, 1996, after having received approval
from the company's creditors and stockholders.
ELPAQ's capital structure will be comprised of $1.2 billion of
senior secured debt, which includes $200 million of collateralized
pollution control revenue bonds, and $100 million of preferred
securities. DCR views the 10-year rate agreement and new
cooperative environment with the City of El Paso as positive
developments as they reenter the competitive marketplace. ELPAQ's
management is committed to additional cost reductions and expense
savings and has as an incentive the ability to retain all benefits
achieved.
ELPAQ generates and distributes electricity to more than 270,000
customers in El Paso, Texas, West Texas, and southern New Mexico.
ELPAQ also delivers power to wholesale customers in southern
California and Mexico.
/CONTACT: Thomas M. Carroll, CPA, CFA, 312-368-3140, or
Catherine E. Drake, 312-368-2065, both of Duff & Phelps Credit
Rating
Co./
DALLAS, Jan. 12, 1996 -- Search
Capital Group, Inc. (OTC
Bulletin Board: SRCG) today announced that it filed a complaint and
motion for a preliminary injunction in the U.S. Bankruptcy Court
Dallas Division to enjoin a minority group of noteholders and their
attorneys from prosecuting a class action suit against Search.
Search itself is not in bankruptcy but is a co-proponent of certain
fund subsidiaries' Joint Plan of Reorganization. The announcement
was made by Search chairman and CEO, George C. Evans.
While the class action suit was filed against Search in the U.S.
Federal District Court for the southern District of Mississippi on
Dec. 21, 1995, notice of its filing was not mailed to Search by the
plaintiffs' attorney until Jan. 8, 1996.
In its motion for injunctive relief, Search identifies that the
class action suit is brought by a group of Noteholders (the
"Mississippi Noteholders") who are creditors in the existing
bankruptcy case of the Fund subsidiaries.
The fund subsidiaries' Joint Plan of Reorganization was
vigorously negotiated between Search and the Creditors' Committee
and provides two recovery options for satisfaction of the claims of
all noteholders. In addition, the Joint Plan establishes a
Litigation Trust that can pursue securities or common law litigation
against Search, its directors and officers and others. In its
motion and complaint, Search asserts that the Mississippi
Noteholders are attempting to create another vehicle through which
they may recover on their claims against the bankrupt Fund
subsidiaries.
The Joint Plan is currently being voted on by all noteholders.
The recovery options outlined in the Joint Plan are: the Search
Equity Option and the Collateral Option. The Search Equity Option
involves the exchange of the creditors debt for a combination of
Search common stock and a new issue of preferred stock. Therefore,
Search states that injunctive relief is essential to protect the
value of the Search equities which creditors will be receiving in
satisfaction of their claims.
"We believe that this complaint brought on by these "Mississippi
Noteholders" is without merit and was filed in an effort to
circumvent the bankruptcy process. On behalf of the approximate
4,484 other Noteholders currently voting on the Joint Plan and on
behalf of Search's existing shareholders, Search will work
vigorously to bring this case to conclusion as soon as possible,"
stated Evans.
Prior to Evans' appointment as CEO and the restructuring of the
management team, Search had created wholly-owned single purpose
entities, referred to as Fund subsidiaries to fund contract
receivable purchasing. Neither Search nor any other subsidiary or
affiliate of Search has guaranteed repayment of the Fund
subsidiaries' notes.
Search Capital Group, Inc. is a specialized financial services
company engaging in the purchase, management and securitization of
used motor vehicle receivables. Search shares are currently traded
on the OTC Bulletin Board under the symbol "SRCG."
/CONTACT: George C. Evans of Search Capital Group, 214-965-6000/