Exhibit 99.1
Investor Relations
eOn Communications
800-955-5321
investorrelations@eoncc.com
For Release 8:30 PM ET, December 15, 2008
eOn Communications Reports First Quarter Results
SAN JOSE, CA(December 15, 2008) – eOn Communications Corporation™ (NASDAQ: EONC), a leading provider of telecommunications solutions, today reported first quarter fiscal 2009 results.
Net loss for the quarter was $134,000, or ($0.05) per common share, compared to a net loss of $911,000, or $(0.33) per common share in the quarter ended October 31, 2007. Revenue for the quarter was $1,784,000 (with no related party revenue), a decrease of 26% compared to $2,396,000 (including related party revenue of $128,000) for the quarter ended October 31, 2007.
Cash, cash equivalents and marketable securities decreased 4% to $2,434,000 from $2,545,000 as of July 31, 2008 primarily as a result of funding operating losses for the three month period.
On December 12, 2008, the Company announced that it had executed an amended and restated Agreement and Plan of Merger to acquire Cortelco Systems Holding Corp. (“Cortelco”) for up to $11,000,000 in cash, with $500,000 to be paid at closing and the remainder to be paid in future quarters based upon the level of Cortelco’s adjusted income for such quarters. On an unaudited basis, Cortelco earned $595,000 in income before taxes on revenues (excluding those earned from eOn) of $4,290,000 for the three month period ended October 31, 2008.
Several steps are required before the acquisition can be completed and there is no guarantee that the transaction will close. The proposed merger may be terminated if the conditions to closing are not fulfilled, in the event of a breach of the agreement by either party, or upon mutual agreement of the parties.
About eOn Communications™
eOn Communications Corporation™ is a global provider of innovative communications solutions. Backed by over 20 years of telecommunications engineering expertise, our solutions enable our customers to easily leverage advanced technologies in order to communicate more effectively. To find out more information about eOn Communications and its solutions, visit the World Wide Web at www.eoncommunications.com, or call 800-955-5321.
Note:
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties, including technical and competitive factors, which could cause the Company’s results and the timing of certain events to differ materially from those discussed in the forward-looking statements. Such risks are detailed in eOn Communications Corporation’s most recent Form 10-Q filing with the Securities and Exchange Commission.
eOn Communications Corporation, the mark eOn, and eQueue are trademarks of eOn Communications Corporation.
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eOn Communications Corporation
Condensed Consolidated Statements of Operations
(Dollars in thousands, except per share data)
Unaudited
Three Months Ended October 31, | ||||||||
2008 | 2007 | |||||||
REVENUE | ||||||||
Third party revenue | $ | 1,784 | $ | 2,268 | ||||
Related party revenue | — | 128 | ||||||
Net revenue | 1,784 | 2,396 | ||||||
COST OF REVENUE | ||||||||
Third party cost of revenue | 813 | 892 | ||||||
Related party cost of revenue | — | 120 | ||||||
Cost of revenue | 813 | 1,012 | ||||||
Gross profit | 971 | 1,384 | ||||||
OPERATING EXPENSE | ||||||||
Selling, general and administrative | 767 | 1,040 | ||||||
Research and development | 305 | 757 | ||||||
Other expense | 44 | 26 | ||||||
Total operating expense | 1,116 | 1,823 | ||||||
Loss from continuing operations | (145 | ) | (439 | ) | ||||
Interest income | 11 | 46 | ||||||
Loss from continuing operations before income taxes | (134 | ) | (393 | ) | ||||
Income tax expense | — | — | ||||||
Loss from continuing operations after income taxes | (134 | ) | (393 | ) | ||||
DISCONTINUED OPERATIONS | ||||||||
Loss from discontinued operations | — | (518 | ) | |||||
Loss from discontinued operations | — | (518 | ) | |||||
NET LOSS | $ | (134 | ) | $ | (911 | ) | ||
Weighted average shares outstanding | ||||||||
Basic and diluted | 2,735 | 2,716 | ||||||
Basic and diluted loss per share: | ||||||||
From continuing operations | $ | (0.05 | ) | $ | (0.14 | ) | ||
From discontinued operations, net of tax | — | (0.19 | ) | |||||
Basic and diluted loss per share | $ | (0.05 | ) | $ | (0.33 | ) | ||
eOn Communications Corporation
Condensed Consolidated Balance Sheets
(Dollars in thousands, except share and per share amounts)
October 31, 2008 | July 31, 2008 | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 1,434 | $ | 1,545 | ||||
Marketable securities | 1,000 | 1,000 | ||||||
Trade accounts receivable, net of allowance of $731 and $680, respectively | 1,145 | 932 | ||||||
Trade accounts receivable - related party | 73 | 84 | ||||||
Inventories | 2,257 | 2,501 | ||||||
Prepaid and other current assets | 65 | 177 | ||||||
Total current assets | 5,974 | 6,239 | ||||||
Property and equipment, net | 135 | 176 | ||||||
Intangibles, net | 230 | 251 | ||||||
Investments | 1,146 | 900 | ||||||
Non-current assets | 110 | 88 | ||||||
Total assets | $ | 7,595 | $ | 7,654 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Trade accounts payable | $ | 237 | $ | 214 | ||||
Trade accounts payable - related party | 174 | 126 | ||||||
Notes payable | 196 | 138 | ||||||
Accrued expenses and other | 1,035 | 1,145 | ||||||
Total current liabilities | 1,642 | 1,623 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock, $0.001 par value, (10,000,000 shares authorized, no shares issued and outstanding) | — | — | ||||||
Common stock, $0.005 par value (10,000,000 shares authorized, 2,870,888 and 2,869,608 shares issued, respectively) | 14 | 14 | ||||||
Additional paid-in capital | 55,988 | 55,931 | ||||||
Treasury stock, at cost (135,380 shares) | (1,502 | ) | (1,502 | ) | ||||
Accumulated deficit | (48,651 | ) | (48,517 | ) | ||||
Accumulated other comprehensive income | 104 | 105 | ||||||
Total stockholders’ equity | 5,953 | 6,031 | ||||||
Total liabilities and stockholders’ equity | $ | 7,595 | $ | 7,654 | ||||
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