WHEAT RIDGE, Colo.--(BUSINESS WIRE)--May 15, 2003--ARC Wireless Solutions, Inc. (OTCBB:ARCS) today announced that it has signed a lease for the former Volant Ski manufacturing building located on Interstate I-70 in Wheat Ridge, Colorado.
The manufacturing facility is approximately twice the size of the Company's current facility with approximately 50,000 square feet, which includes 14,000 square feet of office space. The Company will use the additional space and manufacturing capability to expand its antenna design and manufacturing operations and to accommodate future growth. The Company's average annual expenditures under the new seven-year lease will be approximately $30,000 per year less than it is currently paying.
The Company also reported financial results for the quarter ended March 31, 2003. Net sales for the period were $6,100,000 as compared with $8,000,000 for the same period last year. The decrease in revenues for the three month period ended March 31, 2003, as compared to the same quarter last year is attributable to a decrease in revenues both at the Company's Wireless Communications Products Division in Colorado and at Winncom Technologies, its wholly owned subsidiary located in Ohio.
The Company had a net loss for the three months ended March 31, 2003, of $389,000 compared with net income of $464,000 for the same period last year. The net loss for the first quarter of 2003 is attributable to the decrease in revenue from both Winncom Technologies and the Company's Wireless Communications Products Division. Included in net income for the quarter ended March 31, 2002, were gains from debt settlements of $178,000. There were no gains from debt settlements recorded in 2003. The decrease in the Company's revenues for the quarter ended March 31, 2003, is primarily due to the sluggishness of the economy in general and of the wireless industry in particular.
Gross profit margins were 17.9% and 22.5% for the three months ended March 31, 2003, and March 31, 2002 respectively. The decrease in gross margin for the quarter ended March 31, 2003, as compared with the quarter ended March 31, 2002, is primarily the result of the larger percentage decrease in revenues from the ARC Wireless Communications Products Division whose products typically have a higher gross margin than the products of Winncom Technologies.
"ARC Wireless continues to face a weak economic environment and unexpected delays in shipments in our most recent quarter. Our primary business continues to be competitive and is affected by both geopolitical events and related emotional events," stated Randall P. Marx, Chief Executive Officer. "We continue to pursue new international and other market opportunities that leverage our core competencies and manufacturing expertise, and the Company continues to seek opportunities to improve both top and bottom line performance. Based on preliminary sales from April, we are optimistic concerning the Company's performance for the second quarter."
"We are also excited to be moving to our new headquarters and manufacturing facility July 1, 2003. In addition to a substantial reduction in our annual lease expense, we will have approximately twice the manufacturing and office space that we currently utilize, with the ability to grow and the increased efficiencies of having all of our Communications Products Division team members under one roof," added Mr. Marx.
About ARC Wireless Solutions, Inc.
ARC Wireless Solutions, Inc. is involved in marketing, distributing and servicing, as well as selective design and manufacturing, of a broad range of wireless components and network products and accessories. The Company develops, manufactures and markets proprietary products, including base station antennas (for cellphone towers) and other antennas, through its ARC Wireless Communications Products Division; it is a value added distributor of Wi-Fi and other wireless networking products through its Winncom Technologies Corp. subsidiary; and it designs, manufactures and distributes cable assemblies for cable, satellite and other markets through its Starworks Wireless Inc. subsidiary. The Company's products and systems are marketed through the Company's internal sales force, OEMs, numerous reseller distribution channels, retail, and the Internet. ARC Wireless Solutions, Inc., together with its ARC Wireless Communications Products Division and its Starworks Wireless subsidiary, are headquartered in Wheat Ridge, Colorado. The Company's Winncom Technologies Corp. subsidiary is located in Solon, Ohio. For more information about the Company and its products, please visit our web sites at
http://www.arcwireless.net,
http://www.antennas.com,
http://www.winncom.com and
http://www.starworkswireless.com.
This is not a solicitation to buy or sell securities and does not purport to be an analysis of the Company's financial position. This Release contains forward-looking statements within the meaning of the Securities Exchange Act of 1934. Although the Company believes that the expectations reflected in the forward-looking statements and assumptions upon which forward-looking statements are based are reasonable, it can give no assurance that such expectations and assumptions will prove to have been correct. See the Company's most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-KSB for the year ended December 31, 2002, for additional statements concerning important factors, such as demand for products, manufacturing costs, and competition, that could cause actual results to differ materially from the Company's expectations.
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