Full Press Release Details
CONTACT: INVESTOR RELATIONS
Henry R. Mandell, Chairman
Spatializer Audio Laboratories, Inc.
SPATIALIZER AUDIO LABORATORIES, INC. REPORTS
FIRST QUARTER OPERATING RESULTS
San Jose, Calif., May 15, 2006- Spatializer Audio Laboratories, Inc. (OTC Bulletin Board:
SPAZ) today announced financial results for the first quarter ended March 31, 2006.
Revenues for the three months ended March 31, 2006 were $100,000, compared to revenues of
$332,000 in the comparable period last year, a decrease of 70%.
Net loss in the three months ended March 31, 2006 was ($173,000), ($0.00) basic per share,
compared with net income of $10,000, $0.00 basic and diluted per share, in the comparable period
Revenues in the three months ended March 31, 2006 were lower due to end-of-life on license
programs and no recognition of deferred revenue, which had been recognized in the comparable period
last year. The net loss resulted from decreased revenues, partially offset by lower operating
At March 31, 2006, the Company had $352,000 in cash and cash equivalents as compared to
$551,000 at December 31, 2005. The decrease in cash resulted from the net loss, a decrease in
accounts payable and a decrease in notes payable, partially offset by a decrease in accounts
receivable. The Company had working capital of $397,000 at March 31, 2006 as compared with working
capital of $560,000 at December 31, 2005.
Spatializer Audio Laboratories Inc. is developer, licensor and marketer of next-generation
audio technologies for the consumer electronics, computing and mobile communication markets. The
company s advanced audio technology is incorporated into consumer electronics audio and video
products, PC and mobile phone handsets from several global brand leaders. Spatializer stock is
traded on the OTC Bulletin Board under the symbol: SPAZ. The company is headquartered in San Jose,
CA, and representative offices throughout the Asia Pacific region. Further information may be
company s web site, www.spatializer.com, Spatializer s SEC filings, and by contacting the
company s Investor Relations Department at investor@spatializer.com.
Safe Harbor Act Statement Under the Private Securities Litigation Reform Act of 1995: Certain
information in this press release are forward looking statements that are based on management s
belief, as well as assumptions made by, and information currently available to management. While
the company believes that its expectations are based upon reasonable assumptions, there can be no
assurances that the company s financial goals will be realized. Numerous uncertainties and risk
factors may affect the company s actual results and may cause results to differ materially from
those expressed in forward-looking statements made by or on behalf of the company. These
uncertainties and risk factors include, but are not limited to the continued need for additional
capital, loss of key personnel, dependence on new technology and intellectual property, dependence
on the PC and consumer electronics industries, dependence on product shipments of third-party
licensees, dependence on third-party technology integrators or chip suppliers, competition and
pricing pressures, and other risks detailed from time to time in the company s periodic reports
filed with the Securities and Exchange Commission.
NOTE: Desper Products Inc. is a wholly owned subsidiary of Spatializer Audio Laboratories Inc.
Spatializer is a registered trademark of Desper Products Inc. All other trademarks are the
property of their respective owners.
PART I. FINANCIAL INFORMATION
ITEM I. FINANCIAL STATEMENTS
SPATIALIZER AUDIO LABORATORIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
| March 31, | December 31, | |||||||
| 2006 | 2005 | |||||||
| (unaudited) | ||||||||
| Current Assets: | ||||||||
| Cash and Cash Equivalents | $ | 352,337 | $ | 550,633 | ||||
| Accounts Receivable, net | 95,365 | 155,233 | ||||||
| Prepaid Expenses and Deposits | 16,210 | 34,104 | ||||||
| Total Current Assets | 463,912 | 739,970 | ||||||
| Fixed Assets | ||||||||
| Accumulated Depreciation | ||||||||
| Property and Equipment, net | 14,337 | 18,403 | ||||||
| Intangible Assets, net | 132,972 | 138,548 | ||||||
| Total Assets | $ | 611,221 | $ | 896,921 | ||||
| LIABILITIES AND SHAREHOLDERS EQUITY | ||||||||
| Current Liabilities: | ||||||||
| Note Payable | 10,443 | |||||||
| Accounts Payable | 8,966 | 14,195 | ||||||
| Accrued Wages and Benefits | 15,140 | 48,095 | ||||||
| Accrued Professional Fees | 34,000 | |||||||
| Accrued Commissions | 42,105 | 31,917 | ||||||
| Accrued Expenses | 1,000 | 40,869 | ||||||
| Total Current Liabilties | 67,211 | 179,519 | ||||||
| Shareholders Equity: | ||||||||
| Common shares, $.01 par value, 65,000,000 shares authorized, 48,763,383 shares issued and outstanding at March 31,2006 and December 31, 2005 | 469,772 | 469,772 | ||||||
| Additional Paid-In Capital | 46,430,030 | 46,430,030 | ||||||
| Accumulated Deficit | (46,355,792 | ) | (46,182,400 | ) | ||||
| Total Shareholders Equity | 544,010 | 717,402 | ||||||
| $ | 611,221 | $ | 896,921 |
See notes to consolidated financial statements
SPATIALIZER AUDIO LABORATORIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
| For the Three Month Period Ended | ||||||||
| March 31, | March 31, | |||||||
| 2006 | 2005 | |||||||
| Revenues: | ||||||||
| Royalty Revenues | $ | 100,488 | $ | 331,950 | ||||
| Cost of Revenues | 10,189 | 33,872 | ||||||
| Gross Profit | 90,299 | 298,078 | ||||||
| Operating Expenses: | ||||||||
| General and Administrative | 118,367 | 151,201 | ||||||
| Research and Development | 144,901 | 99,290 | ||||||
| Sales and Marketing | 1,241 | 39,253 | ||||||
| 264,509 | 289,744 | |||||||
| Operating (Loss) | (174,210 | ) | 8,334 | |||||
| Interest and Other Income | 3,219 | 2,920 | ||||||
| Interest and Other Expense | (1,240 | ) | ||||||
| 3,219 | 1,680 | |||||||
| Income (Loss) Before Income Tax | (170,991 | ) | 10,014 | |||||
| Income Taxes | 2,400 | |||||||
| Net Income (Loss) | $ | (173,391 | ) | $ | 10,014 | |||
| Basic and Diluted Earnings Per S | $ | (0.00 | ) | $ | 0.00 | |||
| Weighted Average Shares Outstanding | 48,763,383 | 46,975,365 |
See notes to consolidated financial statements