Coreco reports slight revenue drop for Q1-03

MAY 15--Coreco Inc. (St.-Laurent, QC, Canada; www.coreco.com) reports that revenues for the first quarter, ended 31 March 2003, amounted to US$4.37 million versus US$4.84 million for the same period in 2002, a drop of 9.7%.

MAY 15--Coreco Inc. (St.-Laurent, QC, Canada;www.coreco.com), a provider of computer vision hardware and software for the OEM and end-user markets, reports that revenues for the first quarter, ended 31 March 2003, amounted to US$4.37 million versus US$4.84 million for the same period in 2002, a drop of 9.7%. The lower revenues resulted in a loss of US$76,000 or US$0.01 per share, versus net earnings of US$163,573 or US$0.02 per share a year earlier.

During the first quarter, Coreco continued to invest significantly in research and product development for its IPD group that targets end-user markets. This investment represented a negative contribution of US$(0.07) per share. Without this expense, earnings would have been US$0.06 per share.

Year over year, the gross margin remained stable at 55% of sales. Sequentially, the gross margin declined from 56.5% in the fourth quarter largely due to the lower revenues. On 31 March 2003, the company's balance sheet showed a net cash position of US$2.26 million.

"The drop in first quarter revenues is attributed to a number of US customers holding back orders in March because of the uncertain geopolitical climate," comments Keith Reuben, chief executive officer of Coreco Inc. "Since quarter end, bookings in April have regained normal levels, which gives us confidence that the situation was temporary."

While US shipments were down 21%, shipments to Europe and Asia increased by 10% and 17%, respectively, over the first quarter in 2002. During the first quarter of 2003, Asia, Europe, and the US accounted for 20%, 32%, and 44% of total sales, respectively, with Canada making up the remainder. By product category, sales of frame grabbers, embedded products, and software made up 60%, 32%, and 6% of total sales, in that order, while the company's end-user products represented the remaining 2%.

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