EXHIBIT 99.2
[GRAPHIC OMITTED]
NEWS RELEASE
FOR IMMEDIATE RELEASE
August 27, 2003
FIBERCORE REPORTS RESULTS FOR SECOND QUARTER
CHARLTON, MA - AUGUST 27, 2003 -- FiberCore, Inc. (OTC Bulletin Board:
FBCEE.0B), a leading manufacturer and global supplier of optical fiber and
preform for the telecommunication and data communications markets, today
announced results for the second quarter ended June 30, 2003.
In the second quarter of 2003, sales decreased by 19% to $5.2 million from $6.4
million in the second quarter of 2002. Sales increased by $542,000 as compared
to the first quarter of 2003. Sales continue to be negatively impacted by a lack
of shipments in South America, which is primarily a single-mode market.
Multi-mode sales from Germany represented approximately 80% of total sales for
the quarter.
Gross profit (loss) in the quarter was $(1,516,000), or (29%) of sales for the
second quarter of 2003 compared to a gross profit of $659,000, or 10% of sales,
in the second quarter of 2002. FiberCore's gross margin was severely impacted by
continuing price declines, albeit at a lower rate of decline, lower production
levels, and continuous interruptions in the production process as a result of
raw material supply shortages. The POVD technology, which is expected to lower
costs, has been partially implemented in the third quarter.
SG&A costs decreased by 37% to $1,077,000 in the second quarter from $2,887,000
in the first quarter of 2002 as a result of cost savings measures implemented
during 2002 and 2003 at all locations. The Company continues to focus on cost
savings in SG&A.
R&D spending decreased by 48% to $389,000 in the second quarter from $752,000 in
the first quarter of 2002. The Company continues the development of its patented
Plasma Outside Vapor Deposition (POVD) process as well as other manufacturing
initiatives, which are all intended to reduce production costs. In addition, the
Company continues to develop specialty glass products in conjunction with its
POVD technology.
Interest expense for the quarter was primarily a result of the higher debt
incurred during 2002 associated with Company's expansion program in Germany.
The loss from operations in the second quarter of 2003 was approximately $3.7
million compared to a loss from operations of approximately $2.8 million in the
first quarter of 2002. The higher loss from operations is attributable to the
higher cost of sales related to production interruptions at the German and
Brazilian locations as well as continued pricing weakness in the single-mode
market.
FiberCore reported a net loss of $5.2 million, or $0.08 per share, in the second
quarter of 2003. In the first quarter of 2002, the net loss was approximately
$5.1 million, or $0.08 per share.
While there was an improvement in operating cash flow in the second quarter of
2003 as compared to the first quarter of 2003 of approximately $586,000, the
improvement was provided by an increase in accounts payable.
As reported in our previous press release, independent accountants have not
reviewed the second quarter financial statements, which contain important
information about the liquidity of the Company and the basis of presentation. In
addition, the financials omit Items 2 and 3 of Part I and all sections of Part
2, which are required for reports filed with the Securities and Exchange
Commission on Form 10-Q. Accordingly, the financial statements for the second
quarter are not in compliance with SEC requirements.
FiberCore, Inc. develops, manufactures and markets single-mode and multimode
optical fiber preforms and optical fiber for the telecommunications and data
communications markets. In addition to its standard multimode and single-mode
fiber, FiberCore also offers various grades of fiber for use in laser-based
systems, to help guarantee high bandwidths and to suit the needs of Feeder Loop
(also known as Metropolitan Area Network), Fiber-to-the Curb, Fiber-to-the Home
and Fiber-to-the Desk applications. Manufacturing facilities are presently
located in Jena, Germany and Campinas, Brazil.
For more information about the company, its products, or shareholder information
please visit our Website at: www.FiberCoreUSA.com or contact us at: Phone -
508-248-3900 or by FAX - 508-248-5588 or E-Mail: sales@FiberCoreUSA.com;
investor_relations@FiberCoreUSA.com
Except for the historical matters discussed above, the statements in this press
release are forward looking and are made pursuant to the "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995. They are
based on the Company's current expectations and are subject to a number of risks
and uncertainties. Actual results may differ materially from those projected as
a result of certain general economic and business conditions; loss of market
share through competition; introduction of competing products by other
companies; changes in industry capacity; pressure on prices from competition or
from purchasers of the Company's products; availability of qualified personnel;
the delivery of an ability to commission new equipment as scheduled; ability to
obtain required financing; dependence on a limited number of raw material
suppliers; the loss or reduced creditworthiness of any significant customers;
and other factors detailed from time to time in the Company's filings with the
Securities and Exchange Commission.
CONTACTS:
AT THE COMPANY:
- ---------------
Dr. Mohd A. Aslami, President/CEO
John D. Ronnquist, Interim CFO
508/248-3900
--Financial Tables Follow--
FIBERCORE, INC.
SELECTED CONSOLIDATED FINANCIAL DATA
(Dollars in thousands except share data)
Three Months Ended Six Months Ended
June 30, June 30,
-------- --------
2003 2002 2003 2002
---- ---- ---- ----
(unaudited) (unaudited) (unaudited) (unaudited)
Net sales $ 5,151 $ 6,374 $ 9,760 $ 14,259
Cost of sales:
Cost of sales 6,560 5,172 12,016 12,455
Restructuring costs -- 197 -- 197
Write-down of inventory 107 346 107 1,133
------------ ------------ ------------ ------------
Cost of sales: 6,667 5,715 12,123 13,785
------------ ------------ ------------ ------------
Gross profit (loss) (1,516) 659 (2,363) 474
Operating expenses:
Selling, general and administrative expenses 1,810 2,887 3,672 5,500
Research and development 389 510 752 993
Restructuring costs -- 103 -- 103
------------ ------------ ------------ ------------
Income (loss) from operations (3,715) (2,841) (6,787) (6,122)
Interest expense, net (1,516) (1,280) (2,833) (2,366)
Other income (expense) - net (1) (1,710) 337 (1,795)
------------ ------------ ------------ ------------
Income (loss) before income taxes and
minority interest (5,232) (5,831) (9,283) (10,283)
Benefit from (provision for) income taxes -- 86 (1) 190
------------ ------------ ------------ ------------
Earnings (loss) before minority interest (5,232) (5,745) (9,284) (10,093)
Minority interest in loss of subsidiaries 21 602 67 872
------------ ------------ ------------ ------------
Net earnings (loss) $ (5,211) $ (5,143) $ (9,217) $ (9,221)
============ ============ ============ ============
Basic earnings (loss) per share
of common stock $ (0.08) $ (0.08) $ (0.13) $ (0.15)
============ ============ ============ ============
Diluted earnings (loss) per share
of common stock $ (0.08) $ 0.08) $ (0.13) $ (0.15)
============ ============ ============ ============
Weighted average shares outstanding:
Basic 68,886,534 61,589,533 68,881,343 61,553,024
Diluted 68,886,534 61,589,533 68,881,343 61,553,024
SELECTED BALANCE SHEET DATA: June 30, December 31,
2003 2002
---- ----
(unaudited) (audited)
Working capital deficiency $ (34,670) $ (27,352)
Total assets 79,406 75,603
Long-term obligations 26,045 21,700
Total liabilities 81,803 71,126
Minority interest 22 15
Accumulated deficit (59,706) (50,490)
Stockholders' equity (1,819) 4,462