Aureal Announces Third Ouarter Financial Results
FREMONT, Calif., Oct. 14, 1996 - Aureal Semiconductor, Inc. (OTC Bulletin Board: AURL) announced
today its financial results for the third fiscal quarter that ended September 29, 1996. A loss for the quarter
of $3.3 million reflected the company's continuing R&D efforts in development of its advanced audio
products, as well as an increase in sales and marketing activities as the Company prepares to release
During the third quarter, the company made significant progress on development efforts toward a number
of products - most significantly with the September announcements of Aureal 3D(TM) (A3D(TM))
technology and the VSP901 Single-Chip Dolby(R) Pro Logic(R) Virtual Surround Processor. A3D
Technology licenses With both Diamond Multimedia and Oak Technology were also announced.
"We believe both licensee companies have the ability to take significant advantage of the technology and
assist us in setting A3D as the standard for 3D audio," said Chief Executive Officer Kip Kokinakis. "We
anticipate further relationships with technology and manufacturing partners who can expand the
marketplace for A3D and the VSP901, which we have begun to demonstrate to a number of major home
entertainment and PC peripheral manufacturers," continued Kokinakis.
Revenues for the third quarter of $237,000 consisted primarily of sales of Crystal River Engineering's
"Accoustetron II," a stand-alone turnkey sound system offering Aureal 3D interactive three dimensional
sound for real-time graphics workstations.
"Expense control remains a prime consideration for the company as it accelerates the sales and marketing
process that accompanies introduction of new products," said Dave Domeier, Chief Financial Officer.
Research and development expenses of $1.5 million for the quarter continue to support development of
new technology. In addition, marketing and sales costs of $880,000 include specific product and
reference design efforts as technology is targeted to specific markets.
Available cash during the quarter was supplemented by the receipt of over $800,000 generated through
collection of prior year international VAT refunds and other old business sources. These funds were
reflected in the financial statements as a combination of a reduction in prepaid assets and other income.
"As we have indicated in previous announcements, the company has not anticipated profitability or
significant revenues in 1996," stated Kip Kokinakis. "Our primary target has been to generate significant
visibility for Aureal's technology in the marketplace in the second half of this year - and that target is
being achieved. We are very excited about the prospects for our A3D technology and its use in both the
PC and home entertainment environments."
Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private
Securities Litigation Act of 1995. Investors are cautioned that such forward-looking statements involve
risk and uncertainties, including, but not limited to, dependence on new technology, foundry capacity,
availability and reliability; dependence on the PC industry and on a product line based on new
technology; 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.
Aureal is focused on the development of advanced audio OEM semiconductor and software solutions that
increase functionality and features for the PC and consumer electronics markets. Together with its
subsidiary, Crystal River Engineering, a recognized pioneer of 3D audio technology, Aureal provides
products designed to raise audio standards and lead audio quality into the, third dimension with its line of
Aureal 3D (A3D) technologies.
NOTE: Aureal, the Aureal logo, Aureal 3D and A3D are trademarks of Aureal Semiconductor Inc. Other
trademarks are properties of their respective owners.
Aureal Semiconductor Inc.
Third Quarter 1996 Financial Information
(dollars in thousands, except per share amounts)
Nine Months Ended Three Months Ended
Sept. 29, Sept. 30, Sept. 29,
of Operations: 1996 1995 1996 1995
Sales $3,280 $47,260 $237 $7,292
Gross Profit 2,994 (6,060) 193
Research and Development 4,843 5,026 1,521 1,626
Sales and Marketing 1,285 13,082 880 1,794
General 1,794 4,049 502 890
Reorganization Asset 1,875 7,971 625 625
Restructuring Charges -- 61,626 -- 8,000
Write-off of Acquired
R&D In Progress 6,013 -- -- --
Expenses 15,810 91,754 3,528 12,935
Interest Expense 1,845 2,371 342 721
and Expense (712) (134) (378)
Net Loss $(13,949) $(100,051) $(3,299)
Net Loss per Share $(0.44) $(5.00) $(0.08)
Sept. 29 December 31
Condensed Balance Sheets: 1996 1995
Current Assets $599 $1,767
Property, Equipment and Other Assets 1,045 1,181
Reorganization Asset 3,125 5,000
Total Assets $4,769 $7,948
Current Liabilities $5,773 $7,305
TCW Credit Facility 7,105 19,300
Other Long-term Liabilities 4,701 5,176
Total Liabilities 17,579 31,781
Stockholders' Deficit (12,810) (23,833)
Total Liabilities and
Stockholders' Deficit $4,769 $7,948
SOURCE Aureal Semiconductor Inc./CONTACT: Lisa Downey of Rourke & Company, 408-453-9194,
for Aureal Semiconductor Inc.; or analysts, David Domeier of Aureal Semiconductor Inc., 510-252-4582/
Braun's Fashion Corporation Reports Agreement with Creditors Committee
MINNEAPOLIS, MN - Oct. 14, 1996 - Braun's Fashions Corporation (Nasdaq-NNM: BFCI) today
announced that it has reached an agreement with the creditors committee in the Company's Chapter 11
reorganization. A disclosure statement containing the terms of the agreement as part of a consensual plan
of reorganization will be sent to the Company's shareholders and creditors shortly.
Although an agreement has been reached with the Company's creditors committee, the plan of
reorganization must be voted on by the shareholders and creditors (including the holders of approximately
$10.0 million of 9% Senior Notes, $2.9 million of bank debt, $3.2 million of store lease rejection claims
and $1.4 million of trade credit) and approved by the bankruptcy court. A confirmation hearing for this
consensual plan of reorganization has been scheduled for November, 22, 1996.
Nicholas H. Cook, Chairman and Chief Executive Officer stated, "We are pleased that we have reached
an agreement with the creditors committee and that it appears we will emerge from bankruptcy within a
relatively short time. The reorganization has involved a tremendous time commitment and effort by the
Company. The performance of our continuing stores over the last several months has been strong and we
look forward to emerging from bankruptcy with this healthy base of store operations."
Braun's Fashions Corporation is based in Minneapolis, Minn., and is a specialty retailer of women's
fashions. Braun's currently has 172 stores in 20 states, primarily in the Midwest and Pacific Northwest.
SOURCE Braun's Fashions Corporation - CONTACT: Stephen W. Clark, Vice President and Chief
Financial Officer of Braun's Fashions Corporation, 612-551-5106/ (BFCI)
Fruehauf Trailer announces interim debtor-in-possession financing facility
INDIANAPOLIS, IN--Oct. 14, 1996--Fruehauf Trailer Corporation (NYSE:FTC) announced today that
the U.S. Bankruptcy Court in the District of Delaware has approved the Company's debtor- in-possession
financing facility provided by Madeline LLC, an affiliate of Cerberus Partners LP. The interim order
entered by the Court on October 10, 1996, provides the Company with the ability to borrow up to an
aggregate of $35 million under the facility. The final hearing on the debtor-in-possession facility has been
scheduled for October 25, 1996, at which time the Company expects that the facility will be increased to
Derek L. Nagle, President, stated: "The financing provides us with available liquidity to make timely
payments for new goods and services and meet other obligations to our customers and employees. We are
working very closely with our suppliers and expect to restart our production lines in the very near future."
Retention of Crisis Manager
The Company also announced the retention of Alvarez & Marsal, Inc. as crisis managers and the
appointment of Thomas E. Ireland, a Managing Director of Alvarez & Marsal, as Chief Executive Officer.
Thomas E. Ireland commented: "I look forward to working with Derek Nagle and the management team at
Fruehauf to meet the challenges of dealing with the chapter 11 process, developing and implementing a
business plan and negotiating a plan of reorganization."
Addition of New Directors
The Company also announced the addition of Messrs. Jonathan C. Gallen and Robert F. Incorvaia to its
Board of Directors. With these additions, the Company's Board is now comprised of Mr. Chriss W.
Street, Mr. Worth W. Frederick, Mr. Gallen and Mr. Incorvaia.
Trading in Fruehauf Trailer common stock has been halted by the New York Stock Exchange pending
further review of Fruehauf's financial situation.
Fruehauf Trailer Corporation is a manufacturer of truck trailers, producing, marketing, and servicing the
industry's widest range of dry freight van, platform, dump and liquid and dry bulk tank trailers. Among the
largest suppliers of trailer parts in North America, Fruehauf products are sold throughout the truck trailer
industry's largest Company-owned dealer and authorized independent dealer network in North America.
CONTACT: Fruehauf Trailer Corporation Michael D. Picchi, 317/630-3000