Exhibit 99.1
Applied Digital Solutions Reports Third Quarter 2003 Operating
Results; 14 Percent Sequential Revenue Increase over Second Quarter
PALM BEACH, Fla.--(BUSINESS WIRE)--Nov. 14, 2003--
Over 5,000 VeriChips and 240 Proprietary Scanners
Ordered in 3rd Quarter
Applied Digital Solutions, Inc. (Nasdaq:ADSX), an advanced
technology development company, today reported its consolidated
results for the third-quarter ended September 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).
The consolidated net loss (i.e. including Digital Angel
Corporation and InfoTech USA, Inc.) for the three-month period ended
September 30, 2003, was $1.2 million, or $0.00 per share, a sharp
reduction from the net loss of $5.9 million, or $0.02 per share, for
the year-ago quarter. Revenue for the third quarter was $23.8 million,
compared with $24.2 million for the year-ago quarter. On a sequential
basis, revenue increased 14 percent, or $2.9 million, and net worth
rose $5.3 million since the second quarter of 2003.
For the nine months ended September 30, 2003, the Company reported
revenue of $69.8 million and net income of $28.3 million, or $0.09 per
share. This includes a one-time gain of $70 million for forgiveness of
indebtedness due to the satisfaction of the Company's debt obligation
to IBM Credit, LLC. In comparison, the Company reported revenue for
the nine months ended September 30, 2002, of $78.4 million, and a net
loss of $49.8 million, or $0.19 per share.
Commenting on the third-quarter results, Scott R. Silverman,
Chairman and CEO, said: "We believe these results represent an
important milestone for the Company. Exclusive of Digital Angel
Corporation's operating results, the Company achieved net income of
over $750,000. The work of restructuring our balance sheet has played
an important role in this turn-around. We are gratified by the growing
demand we've experienced for VeriChip internationally, with more than
5,000 VeriChips ordered in the third quarter alone. We've also seen
significant progress in securing Federal contracts at our Government
Telecommunications (GTI) unit."
Mr. Silverman continued: "In order to improve Digital Angel
Corporation's performance, changes have been made. With the recent
agreement to acquire Outerlink Corporation and the appointment of Van
Chu as CEO, Digital Angel Corporation will now focus on marketing its
location technology and condition monitoring for high-value assets.
Given Outerlink's proprietary technology and top-tier U.S. Government
and commercial customers, we are confident that Outerlink and Mr. Chu
will bring value to Digital Angel Corporation and, in turn, Applied
Digital Solutions."
Highlights from the third quarter 2003 include:
-- Total of more than 5,000 VeriChips ordered;
-- First distribution agreement for VeriChip in Europe with
five-year exclusive distribution agreement for Spain;
-- In July, exclusive VeriChip distributor for Mexico launched
"Solusat Medica" to promote VeriChip's healthcare applications
in Mexico;
-- Government Telecommunications, Inc. (GTI) awarded a contract
valued at approximately $15 million from the United States
Postal Service (USPS) to upgrade telecommunications networks
at up to 62 Postal Service facilities. GTI also received an
order valued at more than $6 million from the United States
Department of Agriculture (USDA) to deploy leading-edge
telecommunications technology at the National Finance Center
in New Orleans, Louisiana. In September, GTI received funded
orders valued at $17 million from a variety of agencies of the
federal government to deploy, upgrade and maintain
telecommunications technology at locations throughout the
United States.
-- Five-year distribution agreement signed for Brazil with
initial order of more than 800 VeriChips; initial purchase
orders for over 700 subdermal VeriChips and 60 proprietary
scanners from its exclusive distributor for Colombia and
Venezuela;
-- Digital Angel Corporation (AMEX: DOC) received its first
commercial stocking order for Bio-Thermo(TM), the Company's
temperature-sensing implantable microchip for the companion
pet market.
-- Digital Angel Corp. and IMI, Platte City, Missouri, an
information alliance partner, were selected by PM Beef to
install a system for capturing data from proprietary RFID and
software products for use on cow/calf farms, feedlots and PM's
harvest and fabrication facility in Windom, MN.
-- Digital Angel Corporation's partner, VeriPrime, Inc., launched
a new food safety system, with initial focus on improved
E.coli protection, the beginning of a comprehensive animal
identification and tracking system, verification of safeguards
against cattle feed contamination and standards of animal
welfare that exceed those now required by most grocery and
restaurant chains.
-- Company agreed to increase its investment in Digital Angel
Corporation, signaling its belief that Digital Angel is
greatly undervalued given growth opportunities for its
proprietary animal identification, bio-sensing, and personal
safeguard/emergency location technologies.
CONFERENCE CALL REMINDER: The Company will hold a conference call
on November 14, 2003, beginning 8:30 a.m. ET. Hosting the call: Scott
Silverman, CEO; Evan McKeown, Chief Financial Officer; and Michael
Krawitz, Executive Vice President and General Counsel. Interested
participants should call 800-472-8309 (from within the United States)
or 706-643-9561 (from international locations). Please reference
Conference I.D. Number 3907686. There will be a playback available
until midnight, November 21, 2003. To listen to the playback, call
800-642-1687 (from within the United States) or 706-645-9291 (from
international locations). Please use pass code 3907686 for the
playback.
This conference call is also being webcast and can be accessed at
Applied Digital Solutions' website at www.adsx.com until November 21,
2003.
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),
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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