Exhibit 99.1
CONTACT: Leonard Carr
Sr. Vice President
713-783-8200
lcarr@tidelmail.com
FOR IMMEDIATE RELEASE
TIDEL REPORTS IMPROVED THIRD QUARTER RESULTS
HOUSTON, Texas -- August 19, 2002 -- Tidel Technologies, Inc. (Nasdaq: ATMS)
today announced improved third quarter results. Condensed results, together with
comparable amounts for the same periods in fiscal 2001, are as follows:
Three Months Nine Months
Ended June 30, Ended June 30,
(In thousands, except per share data) 2002 2001 2002 2001
Revenues $ 6,179 $ 4,972 $15,554 $29,825
Operating loss (533) (20,215) (3,694) (16,561)
Net loss (1,019) (16,446) (5,133) (14,492)
Basic loss per share $ (0.06) $ (0.94) $ (0.29) $ (0.83)
Diluted loss per share $ (0.06) $ (0.94) $ (0.29) $ (0.83)
Revenues for the quarter ended June 30, 2002 were $6,179,000, an increase of
$1,440,000, or 30%, over the previous quarter ended March 31, 2002, and an
increase of $1,207,000, or 24%, from the same quarter a year ago. An increase in
the shipment of ATM units accounted for the majority of the increase in
revenues. A total of 1,004 ATM units were shipped in the quarter ended June 30,
2002, representing a 53% increase over the 657 units shipped in the previous
quarter ended March 31, 2002, and an increase of 51% over the 666 units shipped
in the comparable quarter of the prior year. The increase was largely due to
business with new customers, including some customers outside the United States.
International sales were $1,128,000 representing 18% of total revenues for the
quarter ended June 30, 2002, compared with $726,000, or 15% of revenues, for the
same quarter of the prior year.
For the nine months ended June 30, 2002, revenues were $15,554,000, a decrease
of 14% from revenues in the comparable period of the prior year of $18,038,000,
excluding sales of $11,787,000 to Credit Card Center ("CCC"), formerly Tidel's
largest customer who is no longer in business. Tidel shipped 2,338 ATM units for
the nine months ended June 30, 2002, a decrease
of 22% from the 2,997 units shipped to customers other than CCC in the previous
year. During the nine months ended June 30, 2001, Tidel shipped 2,339 ATM units
to CCC. The decline in shipments to customers other than CCC was attributable to
decreased orders from two of Tidel's major customers. Tidel believes that it has
good relationships with these customers and that their current level of
purchases will increase, although there can be no assurance that this will
occur.
Tidel incurred a net loss of $(1,019,000) for the quarter ended June 30, 2002,
compared to a net loss of $(16,446,000) in the same quarter of 2001. For the
nine months ended June 30, 2002, Tidel incurred a net loss of $(5,133,000),
compared to a net loss of $(14,492,000) for the same period in 2001. The results
for quarter ended June 30, 2001 included a provision for bad debts of
$18,000,000 related to the collection of accounts receivable from CCC, and a
charge of $2,530,000 applicable to the write-off of certain deferred financing
costs as a result of the "put" of Tidel's subordinated convertible debentures.
Consequently, comparisons of the net losses in 2002 with the net losses for the
respective periods in 2001 are not meaningful.
Gross profit on product sales for the quarter ended June 30, 2002 increased
$1,355,000 from the same quarter a year ago. Gross profit as a percentage of
sales was 35% in the quarter ended June 30, 2002, compared to only 16% in the
same quarter of the previous year. The improvement is directly related to the
increase in the volume of ATM units produced during the quarter ended June 30,
2002.
Tidel's selling, general and administrative expenses were $2,405,000 for the
quarter ended June 30, 2002, a decrease of 12% from 2001 despite increased sales
for the period. Tidel has reduced its staff by more than 10% and reduced certain
of its costs in the service and engineering departments. Selling, general and
administrative expenses for the nine months ended June 30, 2002 only decreased
4% from the same period a year ago due to increased legal fees incurred in
connection with litigation related to the CCC bankruptcy and other matters. In
addition, Tidel has incurred interest expense of $675,000 per quarter, including
penalty interest of $405,000 per quarter, on its subordinated debentures since
the debt was "put" back to Tidel in June 2001. Although this interest has been
and continues to be accrued, Tidel has made no cash payments of interest to the
debenture holders since June 2001.
Management continues to negotiate with the holders of Tidel's subordinated
convertible debentures to restructure the past due obligations. While Tidel and
the largest holder of the debentures have agreed on proposed terms of a
restructuring, there can be no assurance that this agreement will culminate in a
successful restructuring of the convertible debentures or that Tidel will be
able to agree on similar terms, or any terms, with the other holder of the
convertible debentures. In addition, discussions are in progress with other
lenders and equity investors for the purpose of obtaining capital to restructure
and/or refinance the convertible debentures and the revolving credit facility
with JP Morgan Chase. If a refinancing has not occurred prior to August 30,
2002, Tidel may seek an extension of the maturity of the revolving credit
facility. There can be no assurance that Tidel will be successful in obtaining
additional capital or in extending the maturity of the revolving credit facility
or that the terms of any new financings will be favorable to Tidel. A failure
either to restructure and/or refinance the convertible debentures and the
revolving credit facility, or to obtain an extension of the August 30, 2002
maturity of the revolving credit facility, if necessary, could have a material
adverse effect on Tidel.
James T. Rash, who has ended his medical leave of absence and resumed his duties
as Chief Executive Officer, has affirmed the accuracy of Tidel's Form 10-Q for
the quarterly period ended June 30, 2002 by certification letter to the U.S.
Securities and Exchange Commission. This action was pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002, which was enacted July 29, 2002.
Tidel Technologies, Inc. is a manufacturer of automated teller machines and cash
security equipment designed for specialty retail marketers. To date, Tidel has
sold more than 40,000 retail ATMs and 150,000 retail cash controllers in the
U.S. and 36 other countries. More information about the company and its products
may be found on the company's web site at www.tidel.com.
"Safe Harbor" disclaimer under the Private Securities Litigation Reform Act of
1995: This press release contains forward-looking statements, including
statements as to anticipated or expected results, beliefs, opinions, and future
financial performance. The forward-looking statements are based on current
expectations and assumptions and involve risks and uncertainties that may cause
the company's actual experience to differ materially from that anticipated.
Estimates are based on reliable information and past experience. However,
operating results are affected by a wide variety of factors, many of which are
beyond the control of the company. Factors include, but are not limited to, the
Company's non-compliance with certain provisions of its Revolving Credit
Facility and Convertible Debentures; the Company's financial position and
working capital availability; the levels of orders which are received and can be
shipped in a quarter; customer order patterns and seasonality; costs of labor,
raw materials, supplies and equipment; technological changes; competition and
competitive pressures on pricing; changes in the company's relationships with
customers or suppliers; acceptance of the Company's product and technology
introductions in the marketplace; unanticipated litigation, claims or
assessments; the Company's ability to reduce costs and expenses and improve
internal operating efficiencies; the economic condition of the ATM industry and
the possibility that it is a mature industry; possible delisting from the Nasdaq
SmallCap Market; and economic conditions in the United States and worldwide.
Additionally, factors and risks affecting operating results include those
described in the company's registration statements and periodic reports filed
with the U.S. Securities and Exchange Commission.
358483-1
TIDEL TECHNOLOGIES, INC.
SELECTED INCOME STATEMENT INFORMATION (Unaudited)
Three Months Nine Months
Ended June 30, Ended June 30,
(In thousands, except per share data) 2002 2001 2002 2001
Revenues $ 6,179 $ 4,972 $ 15,554 $ 29,825
Cost of sales 4,020 4,168 11,022 19,709
Gross profit 2,159 804 4,532 10,116
Selling, general and administrative 2,405 2,723 7,352 7,674
Provision for doubtful accounts -- 18,000 -- 18,025
Depreciation and amortization 287 296 874 978
Operating loss (533) (20,215) (3,694) (16,561)
Interest expense, net 486 2,851 1,762 3,521
Loss before taxes (1,019) (23,066) (5,456) (20,082)
Income tax benefit -- (6,620) (323) (5,590)
Net loss $ (1,019) $(16,446) $ (5,133) $(14,492)
Basic loss per share $ (0.06) $ (0.94) $ (0.29) $ (0.83)
Diluted loss per share $ (0.06) $ (0.94) $ (0.29) $ (0.83)
Basic shares outstanding 17,426 17,426 17,426 17,407
Diluted shares outstanding 17,426 17,426 17,426 17,407
TIDEL TECHNOLOGIES, INC
SELECTED BALANCE SHEET INFORMATION
(In thousands)
Jun. 30, Sep. 30,
2002 2001
Cash $ 1,408 $ 3,266
Restricted cash 2,205 --
Trade accounts receivable 6,269 7,036
Current notes and other receivables 2,313 1,357
Federal income tax receivable -- 5,596
Inventories, net 8,399 11,015
Current assets 21,082 28,797
Current liabilities 25,496 28,547
Working capital (deficit) (4,414) 250
Total assets 25,550 33,837
Long-term debt -- 96
Shareholders' equity
