OXFORD, Miss., Aug. 2, 2005 (PRIMEZONE) -- Modern Technology Corp. (OTCBB:MOTG), a diversified technology development and acquisition company, issued an update to stockholders today discussing the company's progress to date and outlook for the remainder of 2005.
Anthony Welch, Chairman said: "We have a lot to report and will limit this update to the more salient achievements. In less than one year, we have taken the company from nominal revenues to realizing unprecedented results. In 2004, we achieved the listing of our common stock, declared a cash dividend, and exceeded our projections by delivering to stockholders revenues of $10,000,000 and assets of $7,000,000.
In January 2005, we acquired Sound City (www.soundcity.com) and also acquired an asset in the form of a Convertible Debenture as part of our $3.5 million funding transaction. This debenture will generate $1.5 million in positive cash-flow for MOTG and is secured by the patents and rights to key geothermal technologies owned by DeMarco Energy Systems (Pink Sheets:DMES) (www.demarcoenergy.com).
Of interest to many stockholders is the subject of dividends. The company has declared dividends in years past and our last cash dividend was in March of 2004. Our intention is to continue paying dividends as we develop and spin-off our subsidiaries. Stockholders should realize strong capital appreciation from these transactions as they occur.
In June we entered into a Letter of Intent to acquire 100% of Innovations in Home Entertainment. This is a key addition to our Electronics and Distribution sector strategy. This acquisition will add an estimated $1,000,000 to MOTG revenues for 2005 and is projected to add another $3,000,000 for 2006. We anticipate signing the Definitive Agreements for this important new acquisition on or around August 1, 2005.
In addition to our subsidiary Sound City opening two new locations and launching Reliant Distributing, we have several more acquisitions lined up for 2005 in this sector. Further growth in revenues and planned acquisitions from this sector are expected to generate in excess of $25 million in 2005.
Also in June we signed a Letter of Intent to acquire the H-NET software technology and completed that acquisition in July. This software technology is a complete end-to-end solution for optometry and optical labs. The commercialization of this asset is expected to generate $5,000,000 for MOTG in 2006. This software is used by LensCrafters, for example (www.h-net.net).
In June, we announced a strategic alliance agreement with UTEK Corporation. This alliance represents a significant new phase in the company's growth. The next phase centers upon the acquisition of nascent commercial technologies and introducing them into the sales and distribution channels of existing MOTG subsidiaries and partners. For example, our subsidiary Sound City, has a database of over 900,000 customers nationwide and an expanding retail footprint combined with a significant inventory and distribution infrastructure. Introduction of new technologies is quite straightforward for us.
Mr. Welch added: "We wish to provide guidance to our current and prospective shareholders as often as is practicable. With the transactions we have closed, plus the anticipated closing of the ones under consideration now, we expect calendar 2005 revenue of between $25 million and $50 million. With transactions under consideration for closing during the second half of 2005, we expect 2005 revenue could be between $50 million and $75 million. I caution shareholders and potential shareholders that this guidance is our best, good faith estimate based on current conditions and numerous assumptions about the industry, our access to financing, the competitive and regulatory landscape and, particularly for the second set of guidance, our ability to successfully consummate the acquisitions we are pursuing. I anticipate updating our shareholders on at least a quarterly basis regarding our expectations."
MOTG's rapid growth and continuing success demonstrate the power of its model. MOTG acquires key technologies and synergistic companies creating revenue and cost benefit from the introduction of both nascent and pre-existing products and technologies. MOTG seeks to create growing shareholder equity supported by stable, strong revenues and assets.
To enhance investor awareness and promote institutional participation, MOTG intends to apply for a listing on a larger stock exchange as soon as is practicable.
About Modern Technology Corp.
Founded in 1982, Modern Technology Corp. is a diversified technology development and acquisition company, building revenues by strategic acquisition and commercialization of nascent commercial technology and by the acquisition of synergistic operating companies. MOTG commercializes technology and provides to its subsidiaries new product lines, operations infrastructure, and significant intellectual capital. The company's mission is to consistently build shareholder value through accretive acquisitions of emerging technology or acquiring operating companies capable of benefiting from technology infrastructure enhancements or new product lines. For more information, visit: http://www.moderntechnologycorp.com.
Safe-Harbor Statement
This press release contains statements (such as projections regarding future performance) that are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected as a result of certain risks and uncertainties, including but not limited to those detailed from time to time in the Company's filings with the Securities and Exchange Commission.