Storage Computer Corporation Announces Third Quarter Results - Company Financial Information

Edge: Work-Group Computing Report, Nov 22, 1999

Storage Computer Corporation (AMEX:SOS), a leading developer and manufacturer of intelligent software-driven multi-host storage solutions for Unix. NT, and Internet based applications, Monday announced third quarter 1999 revenue of $2.5 million, compared to third quarter 1998 revenue of $3.2 million. Revenue has been impacted by reduced promotional budgets and lower sales force headcount.

Operating loss for quarter ended Sept. 30, 1999 was $386,403 versus an operating loss of $973,054 in the prior quarter, and compared to third quarter 1998 operating loss of $3,055,586. Net loss for the quarter ended Sept. 30, 1999 was $591,093 compared to third quarter 1998 net loss of $2,080,709. Fully diluted net loss per share was $.05 per share for third quarter 1999, compared to net loss of $.18 for the 1998 third quarter.

Chairman and CEO of Storage Computer, Ted Goodlander, stated, "The sharp decline in operating losses, both year over year and sequentially from the prior quarter demonstrates that the Company has largely completed its plan to structure and refocus the organization to begin to gain revenue growth through channel sales. We continue to focus our major efforts on channel development."

On October 18. 1999, Keith Perry, Senior VP Worldwide Sales and Marketing resigned to join a software consulting company outside the storage industry. In response, the Company promoted Mr. Charles Geiger to Senior VP of US Sales and Marketing, and Mr. Bill Greenfield to Senior VP and Managing Director European Operations. Mr. Geiger and Mr. Greenfield each have over 30 years of experience in the storage industry primarily marketing through Reseller channels and OEM accounts.

The following financial data summarizes Storage Computer Corporation's financial results for the second quarters ended September 30, 1999 and 1998.

                                       Quarter Ended   Quarter Ended
                                      Sept. 30, 1999  Sept. 30, 1998

Revenue                               $  2,479,868    $  3,198,182
Gross Margin                             1,240,888         429,307
Operating Income (loss)                   (386,403)     (3,056,586)
Income (loss) before Income Taxes         (591,028)     (3,206,709)
Provision for Income Taxes                      65      (1,126,000)
Net Income (loss)                         (591,093)     (2,080,709)
Net Income (loss) Per Basic Share     $       (.05)   $       (.18)
Net Income (loss) Per Diluted Share           (.05)           (.18)
Basic Shares                            11,380,267      11,283,948
Diluted Shares                          11,380,267      11,283,948

Storage Computer Corporation develops and manufactures intelligent software-driven multi-host storage solutions used to drive core business applications in Unix, NT, and Internet environments. Storage Computer solves its customer's business problems through its StorageSuite product line and patented OmniRAID and OmniFORCE storage software. Storage Computer Corporation is a publicly held company traded on the American Stock Exchange under the symbol SOS. The Company's worldwide headquarters are in Nashua, New Hampshire, with subsidiaries and distribution in over 30 countries. Company information may be found on the World Wide Web at http://www.storage.com.