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ALANCO TECHNOLOGIES, INC.
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FOR IMMEDIATE RELEASE CONTACT: Alanco Investor Relations
(480) 607-1010
Web: www.alanco.com
ALANCO REPORTS IMPROVED THIRD QUARTER RESULTS
(Scottsdale, AZ - May 14, 2002) - Alanco Technologies, Inc. (NASDAQ: ALAN) today
announced improved results for its fiscal third quarter ended March 31, 2002,
reporting a 78% reduction in loss from continuing operations to $177,300, or
$0.02 per share, from $813,500, or $0.12 per share, in the prior year third
quarter. The quarter's operating improvement was primarily attributed to closure
of the Company's unprofitable SanOne, Inc. subsidiary and implementation of
extensive cost reduction measures in the continuing data storage businesses,
Arraid, Inc. and Excel/Meridian Data, Inc. Lower third quarter sales of
$902,700, compared to $2,385,300 in the prior year period, were due to the
SanOne closure, as well as reduced demand for the Company's storage products
reflecting general weakness in the technology sector.
During the quarter the Company also reported an asset impairment charge against
its Gold & Minerals, Inc. (G&M) stock holdings, resulting in a loss from
discontinued operations of $2.1 million, or $0.23 per share. The non-cash charge
is a result of the Company's agreement to exchange all of its G&M stock for
approximately 9% of the outstanding stock of Technology Systems International,
Inc. (TSI), scheduled to be acquired by the Company today, pending shareholder
approval.
Alanco Chairman and Chief Executive Officer, Robert R. Kauffman, stated,
"Relative to our storage businesses, we believe that continued lower levels of
operating cost and a return to historic sales levels will result in continued
quarterly financial improvement. We are particularly looking forward to
completion of the TSI acquisition and anticipate that this exciting new business
opportunity will provide a significant contribution to Alanco's financial
results in our fiscal first quarter beginning July 1, 2002."
Alanco Technologies, Inc., headquartered in Scottsdale, Arizona, is a publicly
owned company focused on high-growth information technology markets. Technology
Systems International, Inc., pending May 14, 2002 shareholder approval, will
operate as a wholly-owned subsidiary of Alanco. Other Alanco Technologies
companies include Network Attached Storage (NAS) provider, Excel/Meridian Data,
Inc., and Arraid, Inc., a provider of storage upgrade solutions for legacy
computer systems. Alanco's common stock is traded on the NASDAQ stock market
under the symbol ALAN.
Except for historical information, the statements contained in this press
release are forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. All such
forward-looking statements are subject to, and are qualified by, risks and
uncertainties that could cause actual results to differ materially from those
expressed or implied by those statements. These risks and uncertainties include,
but are not limited to, reduced demand for information technology equipment;
competitive pricing and difficulty managing product costs; development of new
technologies which make the Company's products obsolete; rapid industry changes;
failure of an acquired business to further the Company's strategies; the ability
to maintain satisfactory relationships with lenders and to remain in compliance
with financial loan covenants and other requirements under current banking
agreements; and the ability to secure and maintain key contracts and
relationships.
(table follows)
Alanco Technologies, Inc.
Condensed Consolidated Statement of Operation
3 Months Ended Mar 31, 9 Months Ended Mar 31,
2002 2001 2002 2001
------------ ------------ ------------ ------------
Net Sales $ 902,700 $ 2,385,300 $ 4,516,700 $ 7,694,500
Cost of Sales (300,600) (1,529,700) (2,486,800) (4,665,000)
------------ ------------ ------------ ------------
Gross Profit 602,100 855,600 2,029,900 3,029,500
Selling, General & Administrative (779,400) (1,627,400) (3,404,400) (4,876,900)
Preferred Stock Dividend -- (41,700) -- (98,300)
------------ ------------ ------------ ------------
Loss from Continuing Operations Attributable
To Common Shareholders (177,300) (813,500) (1,374,500) (1,945,700)
------------ ------------ ------------ ------------
Loss - Discontinued Operations
Operating Loss (3,300) (9,500) 7,300 249,000
Asset Impairment Charge (2,100,000) -- (2,100,000) --
------------ ------------ ------------ ------------
Net Income (Loss) from Discontinued Operations (2,103,300) (9,500) (2,092,700) 249,000
------------ ------------ ------------ ------------
Net Loss Attributable to Common Stockholders $ 2,280,600) $ (823,000) $(3,467,200) $(1,696,700)
============ ============ ============ ============
Earnings Per Share - Basic & Diluted
Continuing Operations (0.02) (0.12) (0.15) (0.29)
Discontinued Operations (0.23) 0.00 (0.23) 0.04
------------ ------------ ------------ ------------
Net Loss per Share $ (0.25) $ (0.12) $ (0.38) $ (0.25)
============ ============ ============ ============
Weighted Average Common Shares
& Equivalents Outstanding 9,170,250 6,787,900 9,170,250 6,787,900
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