NEW YORK-Geotek Communications Inc., a Montvale, N.J., provider of wireless communications geared to mobile workers, reported second-quarter and first-half results Aug. 17 that reflect the company’s efforts to restructure for improved performance.
Geotek said it reduced “engineering and development expenses related to enhancement of [our] digital wireless system and customer handsets” by 41 percent to $9.2 million as of June 30.
Citing higher marketing costs associated with the launch of its Driver Logistics System, Geotek said selling and marketing expenses increased by 40 percent to $13.7 million at the end of the first six months of 1998.
During the second quarter of this year, the company pared its general and administrative expenses by 28 percent to $6.2 million, “the result of cost-containment efforts initiated at the end of 1997.”
However, the first-half results didn’t show an overall decline in this overhead because of “transaction costs associated with the February sale of the company’s European assets,” Geotek said.
Geotek cited the $57 million sale of National Band Three Ltd., its European network subsidiary, and “fewer contract sales to customers in South Korea” as primary reasons for declines in overall and wireless operating revenues, accompanied by decreased losses per share.
Overall operating revenues for the three and six months ended June 30 were $6.6 million and $13.6 million, respectively, compared with $18.4 million and $29.5 million for the same periods last year, the company reported.
Wireless communications operating revenues for the second quarter and first half of this year totaled $6.6 million and $11 million, respectively, a decline of 36 percent and 21 percent when compared with the same periods in 1997, Geotek said.
Overall operating losses for the three and six months ended June 30 were $42.8 million and $94.5 million, respectively, compared with losses of $41.6 million and $76.7 million for the same periods in 1997.
Ongoing wireless communications activities posted losses before interest, taxes, amortization and depreciation of $22.6 million and $56.8 million, respectively, for the first three and six months of 1998. For the same periods in 1997, the company posted losses of $29.3 million and $52.6 million.
The company posted net losses of 33 cents per common share for both the first quarter and half, down from 76 cents and $1.41 for the same periods in 1997. It noted, however, that the weighted average number of Geotek common stock shares outstanding at the close of the second quarter was 130.5 million, more than double the 62.8 million outstanding during the year-ago quarter.