Wegener Corporation Reports Significantly Improved Preliminary Results For First Quarter Fiscal Year 2011

JOHNS CREEK, Ga.--()--Wegener Corporation (OTCQB: WGNR.PK), a leading provider of products for television, audio and data distribution networks worldwide, today announced preliminary operating results for the first quarter of fiscal 2011, which ended December 3, 2010. Final results will be released on January 17, 2011.

Preliminary operating results for the first quarter of fiscal 2011 were revenues of approximately $3.0 million and a net loss of approximately $(26,000) or less than $(0.01) per share compared to revenues of $1.9 million and a net loss of $(990,000) or $(0.08) per share for the same period in fiscal 2010.

Wegener Corporation’s eighteen-month backlog was approximately $6.3 million at December 3, 2010, compared to $4.2 million at November 27, 2009. The total multi-year backlog at December 3, 2010, was approximately $6.3 million compared to $6.6 million at November 27, 2009. Bookings for the first quarter of fiscal 2011 were approximately $3.2 million compared to $1.8 million for the same period in fiscal 2010.

“Our bookings and revenue performance in the first quarter of fiscal 2011 was a strong improvement over each of the quarters of fiscal 2010 and the first quarter operating loss was less than any of the quarters in fiscal 2010. I am not satisfied with our performance but I am pleased with the real progress the WEGENER team is making. The improvement in bookings that we saw in fiscal 2010 has continued into fiscal 2011. We must continue to push hard as a team as significant bookings are still needed for the second quarter and the remainder of fiscal 2011,” stated Troy Woodbury, President and CEO of Wegener Corporation. “Our purpose is to serve our customers and we are focused on improving WEGENER and our ability to accomplish that purpose.

“Our Compensation and Incentive Plan Committee of our Board of Directors has recently granted 1,163,700 shares in stock options and restricted stock to senior executives, all other employees, and members of the Board pursuant to our 2010 Incentive Plan. The Committee feels strongly that the interests of our senior executives, all other employees, and board members should be closely aligned to those of our shareholders. We believe this grant will prove to be a real incentive to the entire company as we work to improve WEGENER in this difficult period.

“While our organization continues to improve in all areas along with our performance, I know our performance must still improve dramatically. I am driving myself and the entire WEGENER team at a hard pace to make that happen. We have many strong opportunities domestically and in various areas of the world. We are determined to work successfully to book these new opportunities and improve our operating performance in the future.”

Wegener Corporation will host a conference call on Monday, January 17, 2011, at 4:15 PM Eastern Time to discuss its financial results. To join the conference call, dial 800.638.5495, or 617.614.3946 for international dial in, and enter participant code 76640112. Wegener Corporation intends to discuss financial and other operational information on this conference call. In addition, this call is being webcast by Thomson/CCBN and can be accessed from the Company’s website at www.wegener.com. It will be archived on WEGENER’s website at www.wegener.com and the replay will be available within one hour after the conference call.

ABOUT WEGENER

WEGENER® (Wegener Communications, Inc.), a wholly-owned subsidiary of Wegener Corporation (OTCQB: WGNR.PK), is an international provider of digital video and audio solutions for broadcast television, radio, telco, private and cable networks. With over 30 years experience in optimizing point-to-multipoint multimedia distribution over satellite, fiber, and IP networks, WEGENER offers a comprehensive product line that handles the scheduling, management and delivery of media rich content to multiple devices, including video screens, computers and audio devices. WEGENER focuses on long- and short-term strategies for bandwidth savings, dynamic advertising, live events and affiliate management.

WEGENER’s product line includes: iPump® media servers for file-based and live broadcasts; COMPEL® Network Control and COMPEL® Conditional Access for dynamic command, monitoring and addressing of multi-site video, audio, and data networks; and the Unity® satellite media receivers for live radio and video broadcasts. Applications served include: digital signage, linear and file-based TV distribution, linear and file-based radio distribution, Nielsen rating information, broadcast news distribution, business music distribution, corporate communications, video and audio simulcasts.

WEGENER® can be reached at (770) 814-4000 or at www.wegener.com.

WEGENER, COMPEL, COMPEL CONTROL, iPUMP, MEDIAPLAN, UNITY, ASSURED FILE DELIVERY, PANDA, PROSWITCH, VIDATA, the stylized W-design logo (for WEGENER®), the stylized C-design logo (for Compel®) and the stylized PANDA design logo are all registered trademarks of WEGENER®. All Rights Reserved.

This news release may contain forward-looking statements within the meaning of applicable securities laws, including the Private Securities Litigation Reform Act of 1995, and the Company intends that such forward-looking statements are subject to the safe harbors created thereby. Forward-looking statements may be identified by words such as "believes," "expects," "projects," "plans," "anticipates," and similar expressions, and include, for example, statements relating to expectations regarding future sales, income and cash flows. Forward-looking statements are based upon the Company’s current expectations and assumptions, which are subject to a number of risks and uncertainties including, but not limited to: customer acceptance and effectiveness of recently introduced products, development of additional business for the Company’s digital video and audio transmission product lines, effectiveness of the sales organization, the successful development and introduction of new products in the future, delays in the conversion by private and broadcast networks to next generation digital broadcast equipment, acceptance by various networks of standards for digital broadcasting, the Company’s liquidity position and capital resources, general market conditions which may not improve during fiscal year 2011 and beyond, and success of the Company’s research and development efforts aimed at developing new products. Discussion of these and other risks and uncertainties are provided in detail in the Company’s periodic filings with the SEC, including the Company’s most recent Annual Report on Form 10-K. Since these statements involve risks and uncertainties and are subject to change at any time, the Company’s actual results could differ materially from expected results. Forward-looking statements speak only as of the date the statement was made. The Company does not undertake any obligation to update any forward-looking statements.

WEGENER CORPORATION AND SUBSIDIARIES
 
CONSOLIDATED BALANCE SHEETS
(in $000's except share data)
   
December 3, September 3,
2010 2010
  (Unaudited)    
Assets
 
Current assets
Cash $ 164 $ 231
Accounts receivable, net 2,536 1,634
Inventories, net 2,077 3,145
Other   173       235  
 
Total current assets 4,950 5,245
 
Property and equipment, net 1,569 1,618
Capitalized software costs, net 1,262 1,263
Other assets   225       235  
 
Total assets $ 8,006     $ 8,361  
 
Liabilities and (Capital Deficit) Shareholders' Equity
 
Current liabilities
Line of credit-related party $ 3,800 $ 3,850
Accounts payable 1,723 2,142
Accrued expenses 1,959 1,732
Deferred revenue 450 529
Customer deposits   232       240  
 
Total current liabilities   8,164       8,493  
 
Commitments and contingencies
 
(Capital deficit) shareholders’ equity

Common stock, $.01 par value; 30,000,000 shares authorized; 12,647,051 shares issued and outstanding

126 127
Additional paid-in capital 20,007 20,006
Accumulated deficit   (20,291 )     (20,265 )
 
Total (capital deficit) shareholders’ equity   (158 )     (132 )
 
Total liabilities and (capital deficit) shareholders' equity $ 8,006     $ 8,361  

WEGENER CORPORATION AND SUBSIDIARY
Summarized Operations Data
(in $000's except per share amounts)  
(Unaudited)
 
 
Three Months Ended
 
December 3, November 27,
  2010     2009  
 
 
Revenues, net $ 2,970   $ 1,918  
 
 
Net loss $ (26 ) $ (990 )
 
Net loss per share
Basic and diluted $ * $ (0.08 )
 
Shares used in per share calculation
Basic and diluted   12,647     12,647  
 
 
* Less than $(0.01) per share

Contacts

Wegener Corporation
Jim Traicoff – CFO, 770-814-4000
Fax: 770-623-9648
info@wegener.com

Contacts

Wegener Corporation
Jim Traicoff – CFO, 770-814-4000
Fax: 770-623-9648
info@wegener.com