SAN JOSE, Calif., Aug. 1, 2005 (PRIMEZONE) -- CoSine Communications, Inc. (Pink Sheets:COSN), a provider of customer support services for managed, network-based IP and broadband service providers, today announced revenue for the quarter ended June 30, 2005 of $699,000 and a net loss of $633,000 or $0.06 loss per share, as compared to revenue of $2.6 million and a net loss of $ 9.7 million or $0.96 loss per share for the quarter ended June 30, 2004.
About Cosine Communications
CoSine Communications was founded in 1998 as a global telecommunications equipment supplier to empower service providers to deliver a compelling portfolio of managed, network-based IP and broadband services to consumers and business customers. Currently, CoSine's business consists primarily of a customer service capability operated under contract by a third party.
Safe Harbor Warning
"Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995: This release contains forward-looking statements, which include, among others, statements concerning CoSine's expected financial performance, exploration of strategic alternatives, and business outlook, expected performance and developments. The company uses words such as "anticipate," "believe," "plan," "expect," "future," "intend" and similar expressions to identify forward-looking statements. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements.
Factors that might cause such a difference include, but are not limited to, Cosine's ability to identify and acquire new business operations while continuing to provide support to CoSine's existing customers and continuing to offer CoSine's intellectual property for license or sale and the reactions, either positive or negative, of investors, competitors, customers, and others to CoSine's strategic direction and to any specific strategic alternative or opportunity selected by CoSine, all as may be discussed in more detail on pages 30 through 36 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2004 and our Form 10 - Q filings. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's opinions only as of the date hereof. CoSine undertakes no obligation to revise or publicly release the results of any revision to these forward-looking statements.
CoSine Communications, Inc.
CONSOLIDATED STATEMENT OF OPERATIONS
(in thousands, except per share data)
Three months Ended Six months ended
June 30, June 30,
2005 2004 2005 2004
-------------------- -----------------------
Revenue:
Product $ -- $ 1,819 $ 216 $ 5,537
Service 699 749 1,380 1,486
-------- -------- -------- --------
Total revenue 699 2,568 1,596 7,023
Cost of revenue 389 1,435 843 2,932
-------------------- --------------------
Gross profit 310 1,133 753 4,091
Operating
expenses:
Research and
development -- 4,352 103 9,607
Sales and
marketing -- 3,155 105 6,538
General and
administrative 1,098 1,197 2,403 2,905
Restructuring
and impairment
charges -- 2,308 (91) 2,343
-------------------------------------------
Total operating
expenses 1,098 11,012 2,520 21,393
-------------------------------------------
Loss from
operations (788) (9,879) (1,767) (17,302)
Interest income
and expense and
other, net 166 141 279 222
-------------------------------------------
Loss before income
tax (benefits)
provision (622) (9,738) (1,488) (17,080)
Income tax
(benefits)
provision 11 (32) 23 11
---------------------- --------------------
Net loss $ (633) $ (9,706) $ (1,511) $(17,091)
====================== ====================
Basic and diluted
net loss per share $ (0.06) $ (0.96) $ (0.15) $ (1.70)
Shares used in
computing basic
and diluted net
loss per share 10,091 10,062 10,097 10,035
CoSine Communications, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
June 30, 2005 December 31,
(Unaudited) 2004 (a)
ASSETS ----------------------------
Current assets:
Cash and cash equivalents $ 12,749 $ 9,203
Short-term investments 10,342 15,710
Accounts receivable, trade 220 1,328
Other receivables 94 483
Prepaid expenses and other
current assets 530 949
-----------------------------
Total current assets 23,935 27,673
Long-term deposits 370 150
-----------------------------
$ 24,305 $ 27,823
=============================
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable $ 203 $ 252
Accrued warranty liability 100 157
Other accrued liabilities 1,368 3,129
Accrued compensation -- 412
Deferred revenue 332 509
-----------------------------
Total current liabilities 2,003 4,459
-----------------------------
Total liabilities 2,003 4,459
=============================
Stockholders' equity:
Common stock 1 1
Additional paid-in capital 538,947 540,028
Notes receivable from
stockholders -- (1,520)
Accumulated other
comprehensive income 624 614
Accumulated deficit (517,270) (515,759)
-----------------------------
Total stockholders' equity 22,302 23,364
=============================
$ 24,305 $ 27,823
=============================
(a) Amounts are derived from the
December 31, 2004 audited financial
statements.