Exhibit 99.1
INVESTOR CONTACT MEDIA CONTACT
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KEN SGRO MATTHEW COSSOLOTTO
CEOCAST, INC. OVATIONS INTERNATIONAL, INC.
PHONE: 212-732-4300 PHONE: 914-245-9721
KENSGRO@CEOCAST.COM MATTHEW@OVATIONS.COM
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APPLIED DIGITAL SOLUTIONS ANNOUNCES IMPROVED FINANCIAL RESULTS FOR THE
SECOND QUARTER AND FIRST HALF OF 2003
Positive EPS of $0.18 includes one-time gain from debt forgiveness -- Net
worth jumps over $78 million from the previous quarter
VeriChip Corporation recognizes revenue for the first time
PALM BEACH, FL - AUGUST 14, 2003 - APPLIED DIGITAL SOLUTIONS, INC. (NASDAQ:
ADSX), an advanced technology development company, today reported its
consolidated results for the second quarter ended June 30, 2003. The
Company's consolidated financial results include the balance sheets,
operating results and cash flows of its majority-owned subsidiaries, Digital
Angel Corporation (AMEX: DOC), and InfoTech USA, Inc., formerly SysComm
International Corporation (OTC: IFTH).
Net income from continuing operations for the three-month period ended June
30, 2003, was $56.8 million, or $0.18 per share, including a $70.4 million
one-time gain for forgiveness of indebtedness due to the satisfaction of the
Company's debt obligation to IBM Credit, LLC. Second quarter net income
compares to a net loss from continuing operations of $19.5 million, or
$(0.07) per share, for the year-ago quarter.
The Company's cash balance increased by over $700,000 due to stricter
internal cash management and the acceleration of collections from accounts
receivable. Net worth increased by over $78 million to $14.3 million.
Revenue from continuing operations in the second quarter of 2003 was $20.9
million, compared with $25.8 million for the year-ago quarter.
The Company also announced today that it is increasing its investment in
Digital Angel Corporation (DOC). Commenting on DOC, Scott R. Silverman,
Chairman and CEO of Applied Digital Solutions, said: "Management believes
DOC is greatly undervalued at the present time given the growth
opportunities for its proprietary animal identification, bio-sensing, and
personal safeguard/emergency location technologies." Mr. Silverman has
recently joined the Board of
Directors of DOC, and the Company will soon nominate one additional Director
to DOC's Board.
Included in the Company's second quarter results is revenue of $148,000 from
its wholly-owned subsidiary, VeriChip Corporation. Although this represents
only a percentage of VeriChip license fees and product sales to date, the
second quarter results reflect the first revenue recognition for this
subsidiary.
For the six months ended June 30, 2003, the Company reported revenue from
continuing operations of $46.0 million and net income from continuing
operations of $30.0 million or $0.10 per share. In comparison, the Company
reported revenues from continuing operations for the six months ended June
30, 2002, of $54.1 million and a net loss from continuing operations of
$44.2 million or $(0.17) per share.
REMINDER: The Company will hold a conference call today at 4:30 p.m. (ET).
U.S.-based participants should call 888-359-6744; International participants
should call 706-679-0604. There will be a playback available as well. To
listen to the playback, please call 800-642-1687 (U.S.) or 706-645-9291
(International). Please use pass code 2238541 for the replay. This call is
being webcast by ViaVid Broadcasting at
www.viavid.net/detailpage.aspx?sid=00001675 and can also be accessed at
Applied Digital's website at www.adsx.com. The webcast can be accessed until
August 28, 2003, either by the telephone replay or Internet site.
About VeriChip(TM)
VeriChip is a subdermal, radio frequency identification (RFID) device that
can be used in a variety of security, financial, emergency identification
and other applications. About the size of a grain of rice, each VeriChip
product contains a unique verification number that is captured by briefly
passing a proprietary scanner over the VeriChip. A small amount of radio
frequency energy passes from the scanner energizing the dormant VeriChip,
which then emits a radio frequency signal transmitting the verification
number. In October 2002, the US Food and Drug Administration (FDA) ruled
that VeriChip is not a regulated device with regard to its security,
financial, personal identification/safety applications but that VeriChip's
healthcare information applications are regulated by the FDA. VeriChip
Corporation is a wholly owned subsidiary of Applied Digital Solutions
(NASDAQ: ADSX). For more information about VeriChip, visit www.adsx.com.
About Digital Angel Corporation
On March 27, 2002, Digital Angel Corporation completed a merger with Medical
Advisory Systems, Inc., which for two decades has operated a 24/7,
physician-staffed response center in Owings, Maryland. Prior to the merger,
Digital Angel Corporation was a 93% owned subsidiary of Applied Digital
Solutions, Inc. (Nasdaq: ADSX - News), which now is the majority owner of
the company. Digital Angel(TM) technology represents the first-ever
combination of advanced sensors and web-enabled wireless telecommunications
linked to Global Positioning Systems (GPS). By utilizing advanced sensor
capabilities, Digital Angel is able to monitor key
functions -- such as ambient temperature and physical movement -- and
transmit that data, along with accurate emergency location information, to a
ground station or monitoring facility. The company also invented,
manufactures and markets implantable identification microchips the size of a
grain of rice for use in humans, companion pets, fish, and livestock.
Digital Angel Corp. owns the patents for its inventions in all applications
of the implantable microchip technology for humans and animals. For more
information about Digital Angel Corp., visit www.digitalangelcorp.com.
About Applied Digital Solutions, Inc.
Applied Digital Solutions is an advanced technology development company that
focuses on a range of life-enhancing, personal safeguard technologies, early
warning alert systems, miniaturized power sources and security monitoring
systems combined with the comprehensive data management services required to
support them. Through its Advanced Technology Group, the company specializes
in security-related data collection, value-added data intelligence and
complex data delivery systems for a wide variety of end users including
commercial operations, government agencies and consumers. Applied Digital
Solutions is the beneficial owner of a majority position in Digital Angel
Corporation. For more information, visit the company's website at
http://www.adsx.com.
Statements about the Company's future expectations, including future
revenues and earnings, and all other statements in this press release other
than historical facts are "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, Section 21E of the Securities
Exchange Act of 1934, and as that term is defined in the Private Litigation
Reform Act of 1995. Such forward-looking statements involve risks and
uncertainties and are subject to change at any time, and the Company's
actual results could differ materially from expected results. The Company
undertakes no obligation to update forward-looking statements to reflect
subsequently occurring events or circumstances.
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