TeraForce Reports
Third Quarter 2004 Results
  Patty Dickerson, Investor Relations — 469-330-4969

RICHARDSON, TEXAS (November 10, 2004)

– TeraForce Technology Corporation (OTCBB: TERA) today announced financial results for the third quarter ended September 30, 2004.

Financial Results

Net revenues in the third quarter of 2004 amounted to $1,439,000 versus $1,699,000 in the third quarter of 2003. Operating loss for the three months ended September 30, 2004 amounted to $1,143,000 versus an operating loss of $1,611,000 in the same period of 2003. For the first nine months of 2004 net revenues amounted to $8,414,000 and operating profit totaled $130,000. This compares with net revenues of $4,037,000 and an operating loss of $4,762,000 in the first nine months of 2003. The results for the first nine months of 2004 reflect product shipments of $5,014,000 and license fees of $3,400,000.

Engineering and development expenses in the third quarter of 2004 were $512,000 as compared to $582,000 in the third quarter of 2003. Selling and administrative expenses decreased to $1,101,000 in the third quarter of 2004 versus $1,171,000 in the third quarter last year.

Herman Frietsch, chairman and chief executive officer of TeraForce Technology Corporation commented, “The slight dip in net revenues for this period, following quarterly increases, reflects the variability in order flow during the early stages of production stemming from our design wins. The business we anticipate from design wins has not diminished. However, as we have indicated previously, variability will continue to be seen as we progress into more consistent production phases.

“Our base of business continues to grow and we are increasing our number of new program pursuits. Our recent transition to a direct sales force coupled with our new products are beginning to make a significant contribution to our growth expectations.

“From a broader perspective, the overall political and budgetary environment appears very promising for our target segments of the defense and homeland security markets. In addition we are seeing considerable consolidation activity within our industry. While this activity may present certain challenges, we believe it provides us with important opportunities that we can exploit effectively.”


Conference Call Scheduled
The Company will host a management conference call Thursday, November 11, 2004 at
3:30 p.m. Central Standard Time, to review the matters discussed in this release. Shareholders and investors interested in attending the conference call should dial 816-650-0765 ten minutes prior to the call and enter reservation code 28809669. A live webcast of the conference call will also be available on the TeraForce website at http://www.teraforcetechnology.com/ and click on “Investor Relations.”

A replay of the conference call will be available later that day from 5:00 p.m. Eastern Standard Time through 5:00 p.m. Eastern Standard Time on December 10, 2004. To access the playback, please call 402-220-2491. The reservation code for the replay is 2880669. A replay will be available online through the TeraForce website at http://www.teraforcetechnology.com/ and click on “Investor Relations.”

About TeraForce Technology Corporation
Based in Richardson, Texas, TeraForce Technology Corporation (OTCBB: TERA) designs, develops, produces and sells high-density embedded computing platforms and digital signal processing products, primarily for applications in the defense electronics industry. TeraForce’s primary operating unit is DNA Computing Solutions, Inc.

Except for the historical information contained herein, the statements in this announcement are forward looking statements which involve risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, the forward looking statements. Factors that might cause such a difference include, but are not limited to, those relating to: general economic conditions in the markets in which the Company operates; success in the development and market acceptance of new and existing products; dependence on suppliers, third party manufacturers and channels of distribution; contingent liabilities; customer and product concentration; fluctuations in customer demand; maintaining access to external sources of capital; ability to attract and retain key management and technical personnel; issues regarding intellectual property rights; overall management of the Company’s expansion; and other risk factors detailed from time to time in the Company’s filings with the Securities and Exchange Commission.


Consolidated Balance Sheets
(Thousands of dollars, except share and per share data)

    September 30,   December 31, 2003
Current assets:
Cash and cash equivalents
  $ 1     $ 165  
Accounts receivable net of allowance of $30 in 2004
and 2003
    660       1,935  
    1,161       1,595  
Prepaid expenses and other current assets
    552       537  
Total current assets
    2,374       4,232  
Property and equipment, net
    293       378  
Investment in affiliate
    100       250  
Other assets
    804       488  
  $ 3,571     $ 5,348  
Liabilities and Stockholders’ Deficit
Current liabilities:
Current portion of notes payable $
    6,520     $ 700  
Accounts payable
    952       552  
Deferred revenue
Accrued liabilities
    2,222       2,629  
Total current liabilities
    9,694       5,431  
Long-term notes payable
    765       5,909  
Other long-term liabilities
    150       795  
Stockholders’ deficit:
Common Stock, $.01 par value; authorized 250,000,000 shares;
133,561,526 and 130,837,186 shares issued in 2004 and 2003,
    1,336       1,308  
Additional paid-in capital
    189,994       189,194  
Accumulated deficit
    (196,781 )     (195,702 )
    (5,451 )     (5,200 )
Less 400,474 shares of common stock in treasury at cost
    (1,587 )     (1,587 )
Total stockholders’ deficit
    (7,038 )     (6,787 )
  $ 3,571     $ 5,348  


Consolidated Statements of Operations
(Thousands of dollars, except share and per share data)

    Three Months Ended
  Nine Months Ended
    September 30,
  September 30,
    2004       2003       2004       2003  
Net revenues
  $ 1,439     $ 1,699     $ 8,414     $ 4,037  
Cost of revenues
    969       1,108       3,013       2,765  
Gross profit
    470       591       5,401       1,272  
Engineering and development
    512       582       1,531       2,063  
Selling and administrative
    1,101       1,171       3,740       3,522  
Write-off of receivable from unconsolidated
          449             449  
    1,613       2,202       5,271       6,034  
Operating profit (loss)
    (1,143 )     (1,611 )     130       (4,762 )
Other income (expense):
Litigation costs, net of
insurance reimbursement
    (50 )     (292 )     (50 )     (417 )
Share of loss and adjustment to carrying
value of unconsolidated affiliate
          (333 )     (50 )     (702 )
Interest expense
    (364 )     (407 )     (1,099 )     (775 )
    (2 )     (16 )     (10 )     (81 )
    (416 )     (1,048 )     (1,209 )     (1,975 )
Net loss
  $ (1,559 )   $ (2,659 )   $ (1,079 )   $ (6,737 )
Basic and diluted loss per share
  $ (.01 )   $ (.02 )   $ (.01 )   $ (.06 )
Weighted average number of common shares
outstanding (thousands) – basic and diluted
    133,161       118,138       132,184       117,102  


Consolidated Statements of Cash Flows
(Thousands of dollars)

    Nine Months Ended September 30,
    2004   2003
Cash flows from operating activities:
Net loss
  $ (1,079 )   $ (6,737 )
Adjustments to reconcile net loss to
net cash used in operating activities:
Utilization of prepaid services
Depreciation and amortization
    165       190  
Amortization of deferred financing costs
    713       510  
Loss related to unconsolidated affiliate
    50       1,151  
    (248 )     (462 )
Changes in operating assets and liabilities:
Accounts receivable
    1,275       (469 )
    434       564  
Deferred revenue
    (1,550 )      
Accounts payable and accrued liabilities
    (291 )     155  
Net cash used in operating activities
    (531 )     (4,905 )
Cash flows from investing activities:
Capital expenditures
    (63 )     (22 )
Investment in temporary cash investments
Proceeds from sale of partial interest in affiliate
Software development costs
    (9 )     (105 )
Net cash provided by investing activities
    28       330  
Cash flows from financing activities:
Proceeds from issuance of notes payable
    575       4,260  
Proceeds from issuance of common stock
    64       516  
Principal payments on notes payable
    (300 )     (225 )
Net cash provided by financing activities
    339       4,551  
Net decrease in cash and cash equivalents
    (164 )     (24 )
Cash and cash equivalents, beginning of period
    165       55  
Cash and cash equivalents, end of period
  $ 1     $ 31  


The following information was filed by Teraforce Technology Corp (TERA) on Wednesday, November 10, 2004 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

View differences made from one quarter to another to evaluate Teraforce Technology Corp's financial trajectory

Compare SEC Filings Year-over-Year (YoY) and Quarter-over-Quarter (QoQ)
Sample 10-K Year-over-Year (YoY) Comparison

Compare this 10-Q Quarterly Report to its predecessor by reading our highlights to see what text and tables were  removed  ,   added    and   changed   by Teraforce Technology Corp.


Never Miss A New SEC Filing Again

Real-Time SEC Filing Notifications
Screenshot taken from Gmail for a new 10-K Annual Report
Last10K.com Member Feature

Receive an e-mail as soon as a company files an Annual Report, Quarterly Report or has new 8-K corporate news.


We Highlighted This SEC Filing For You

SEC Filing Sentiment Analysis - Bullish, Bearish, Neutral
Screenshot taken from Wynn's 2018 10-K Annual Report
Last10K.com Member Feature

Read positive and negative remarks made by management in their entirety without having to find them in a 10-K/Q.


Widen Your SEC Filing Reading Experience

Increased Reading Area for SEC Filings
Screenshot taken from Adobe Inc.'s 10-Q Quarterly Report
Last10K.com Member Feature

Remove data columns and navigations in order to see much more filing content and tables in one view


Uncover Actionable Information Inside SEC Filings

SEC Filing Disclosures
Screenshot taken from Lumber Liquidators 10-K Annual Report
Last10K.com Member Feature

Read both hidden opportunities and early signs of potential problems without having to find them in a 10-K/Q


Adobe PDF, Microsoft Word and Excel Downloads

Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshots of actual 10-K and 10-Q SEC Filings in PDF, Word and Excel formats
Last10K.com Member Feature

Export Annual and Quarterly Reports to Adobe PDF, Microsoft Word and Excel for offline viewing, annotations and analysis


FREE Financial Statements

Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshot of actual balance sheet from company 10-K Annual Report
Last10K.com Member Feature

Get one-click access to balance sheets, income, operations and cash flow statements without having to find them in Annual and Quarterly Reports

Continue for FREE

Intrinsic Value Calculator

Intrinsic Value Calculator
Screenshot of intrinsic value for AT&T (2019)
Last10K.com Member Feature

Our Intrinsic Value calculator estimates what an entire company is worth using up to 10 years of financial ratios to determine if a stock is overvalued or not


Financial Stability Report

Financial Stability Report
Screenshot of financial stability report for Coco-Cola (2019)
Last10K.com Member Feature

Our Financial Stability reports uses up to 10 years of financial ratios to determine the health of a company's EPS, Dividends, Book Value, Return on Equity, Current Ratio and Debt-to-Equity


Get a Better Picture of a Company's Performance

Financial Ratios
Available Financial Ratios
Last10K.com Member Feature

See how over 70 Growth, Profitability and Financial Ratios perform over 10 Years


Log in with your credentials


Forgot your details?

Create Account