DENVER, April 22, 2004 (PRIMEZONE) -- Nighthawk Systems, Inc. (OTCBB:NIHK), a provider of intelligent remote power control equipment and services, reported record results for its year ended December 31, 2003 with the filing of its Form 10-KSB on April 13, 2004, and today commented on those results.
Revenues for the year were a record $1,030,793, a 56% increase over revenues of $661,199 from the prior year. These revenues were generated primarily by sales of the Company's core products to the electric utility, computer-rebooting traffic control markets, and do not include revenues from the Company's discontinued retail paging operating segment, which was disposed of on July 31, 2003. The Company recognized a gain of $92,443 on the disposal of this segment of its business, which produced a loss of approximately $262,000 in 2002.
Selling, general and administrative expenses declined significantly from approximately $1,474,000 in 2002 to approximately $957,000 in 2003. These figures include adjustments made as a result of the resolution of several corporate governance and operational issues during 2003, and include a restatement of expenses related to 2002.
The Company's net loss declined from approximately $1,463,000 or $0.08 per share in 2002 to $552,457 or $0.03 in 2003.
H. Douglas Saathoff, Chief Executive Officer, stated, "We're pleased but not satisfied with the improvement in results between years. Of more significance than the improvement in results is the fact that we streamlined the Company's operations during the year, and improved and diversified our product offerings within our targeted markets."
The Company also announced that subsequent to the filing of its Form 10-KSB, it reached an agreement with its largest creditor, who is also a shareholder. Under terms of the arrangement, the investor has agreed to extend the maturity dates to July 31, 2004 of $350,000 in notes on which the Company was in default at December 31, 2003. In return for a secured position, the investor also agreed to allow the Company to force the conversion of $200,000 of the outstanding debt to equity and extend the maturity dates of the remaining notes to January 31, 2005, should the Company raise $1.0 million in equity prior to July 31, 2004.
Mr. Saathoff commented, "Coupled with our recently announced financing plans, the new agreements with our biggest creditor provide the Company with the ability to significantly improve its balance sheet and working capital position with a successful fundraising. I appreciate the willingness of this creditor, who is also a significant shareholder, to continue to work with the Company to facilitate fundraising efforts and to ensure that money raised will be available to enhance sales and marketing efforts.
Mr. Saathoff continued, "Over the past two months, we've made multiple announcements about contracts with both existing and new customers. We expect this trend to continue, and to accelerate with the implementation of our sales and marketing plan upon completion of our announced financing effort. Based on feedback from the customers themselves, I feel confident that we will receive additional orders in the coming days from all three of our targeted markets that will have a positive impact on the Company's second quarter and beyond. Increased sales should ultimately lead to better costs of production, and better bottom-line results for the Company."
About Nighthawk Systems, Inc.
Nighthawk Systems, Inc. designs and manufactures easy to use 'plug and play' products that can remotely control virtually any electrical device from any location. Nighthawk products are easily installed and operated by anyone, regardless of technical capability. Nighthawk services customers in a variety of markets including electric utilities, traffic control, computer systems, commercial lighting, and irrigation. For more information visit www.nighthawksystems.com.
Forward-looking statements
Statements contained in this release, which are not historical facts, including statements about plans and expectations regarding business areas and opportunities, demand and acceptance of new or existing businesses, capital resources and future financial results are "forward-looking" statements as contemplated by the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties, including, but not limited to, government regulation, taxation, spending, competition, general economic conditions and other risk factors which could cause actual results to differ materially from those projected or implied in the forward-looking statements. There may be other factors not mentioned above that may cause actual results to differ materially from any forward-looking information.