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EMRISE CORPORATION REVISES FINANCIAL OUTLOOK FOR 2005 AND 2006 RANCHO CUCAMONGA, CALIFORNIA, December 22, 2005 - EMRISE CORPORATION (PCX: ERI), a multi-national manufacturer of defense and aerospace electronic components and subsystems and communications equipment, yesterday announced a revised financial outlook for 2005 and 2006. The revised outlook was discussed during the Company’s annual stockholders’ meeting, which was held yesterday and which was web-cast for investors. The Company currently anticipates its revenues will be approximately $40.5 to $41.5 million, yielding approximately $1.2 to $1.3 million in net income for the year ending December 31, 2005. This compares to the Company’s previous guidance of $47 million in revenue, and net income of $3.5 million. The reduction is primarily due to less year-end budget spending during December by customers in the Company’s communications segment, which management believes was mainly caused by the unprecedented merger and divestiture activity occurring in the U. S. communications industry during 2005. In addition, the Company experienced delays in the Eurofighter program which has started to come on-line with orders for $8.2 million, delays in orders of French military communications products until the third quarter of this year and a $1.5 million non-cash impact from currency translations of foreign subsidiary revenue converted into U. S. dollars. For the fiscal year ending December 31, 2006, the Company anticipates revenues of $57 to $58 million and net income of approximately $4.8 to $5.5 million. The Company anticipates providing more definitive guidance at the end of the first quarter of 2006. No additional acquisitions were included in the revenue outlook. About EMRISE CORPORATION EMRISE CORPORATION is a multi-national manufacturer of defense and aerospace electronic components and subsystems and communications equipment. EMRISE’s electronic components group, which includes EMRISE Electronics Corporation and its international subsidiaries, provides custom power conversion and RF component and subsystem products, digital and rotary switches and subsystem assemblies to the North American, European and Asian electronic components market that are primarily used for defense, aerospace and industrial applications. EMRISE’s communications group, consisting of CXR Larus Corporation and CXR-Anderson Jacobson, provides network access and transmission products, communications timing and synchronization products and communications test equipment to the North American, European and Asian communications market. Founded in 1983, EMRISE operates out of facilities in the United States, England, France and Japan. As of July 31, 2005, EMRISE had a total of 301 employees in its various subsidiaries and divisions. EMRISE's Internet address is www.emrise.com. Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 With the exception of historical information, the matters discussed in this press release, including EMRISE’s anticipation that it will achieve approximately $40.5 to $41.5 million in total net sales and total net income of $1.2 to $1.3 million for 2005 and achieve approximately $57 to $58 million in total net sales and $4.8 to $5.5 million in total net income for 2006 are forward-looking statements that involve a number of risks and uncertainties. The actual future results of EMRISE could differ from those statements. Factors that could cause or contribute to such differences include, but are not limited to, EMRISE’s ability to identify and successfully negotiate, fund and integrate recent and future acquisitions and to improve operating efficiency and realize anticipated synergies, measurably lowered costs and increase profitability due to the integration and growth of recently acquired or potentially acquirable businesses, the receipt and timing of contracts and orders from existing and potential customers for EMRISE’s products and services, EMRISE’s ability to produce and fulfill delayed and backlog orders, the receipt of production materials and resale products in a timely fashion, market and economic conditions, changes in technology and governmental regulations and policies, competitive products and services, unforeseen technical issues, unexpected changes in typical seasonal sales trends and those factors contained in the “Risk Factors” Section of EMRISE's latest Form 10-K and other public filings.
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