TAIPEI, Taiwan - April 24 (SEND2PRESS NEWSWIRE) -- City Network, Inc. (Amex: CSN), a company that designs, manufactures, and markets a comprehensive line of broadband and wireless Internet access solutions and consumer electronic products, announced financial results for the year end December 31, 2005. Net sales for the year ended December 31, 2005 totaled $14,320,409, compared to $15,674,613 for ten months ended December 31, 2004. The decrease in revenues for the year ended December 31, 2005 was due to a decline in the amount of sales of certain merchandise.
Net loss after tax was $1,057,476 or $0.038 per share for the year ended December 31, 2005, compared to net loss after tax of $964,660 or $.035 per share for the ten months ended December 31, 2004.
Furthermore, cost of revenue for the year ended December 31, 2005 totaled $12,881,717, compared to $14,924,938 for the ten months ended December 31, 2004. The decrease in cost of revenues was due to a decrease in sales.
The Company also announced that gross profit increased due to the higher margin of certain merchandise and their decline in cost but not their sales price for the year ended December 31, 2005.
The Company reported that its independent registered public accounting firm included an explanatory paragraph in their opinion in connection with the 2005 audit, relating to the Company's ability to continue as a going concern.
In addition, Mr. "Andy" Lai Tiao-Tsan announced that he will resign from his positions as the Company's Chairman, President and Chief Executive Officer and will be replaced by Ms. Alice Chen, who currently serves as a member of the board of directors of the Company and who will assume the responsibilities of Mr. Lai's positions immediately.
About City Network Inc.
For more information about City Network, Inc., please visit http://www.citynetwork.com.tw
Safe Harbor under the Private Securities Litigation Reform Act of 1995:
The statements which are not historical facts contained in this press release are forward-looking statements that involve certain risks and uncertainties including but not limited to risks associated with the uncertainty of future financial results, regulatory approval processes, the impact of competitive products or pricing, technological changes, the effect of economic conditions and other uncertainties as may be detailed in City Network's filings with the Securities and Exchange Commission.
CONSOLIDATED STATEMENTS OF INCOME
"FISCAL YEAR ENDED DECEMBER 31, 2005 AND TEN MONTHS ENDED DECEMBER 31, 2004"
Sales, net $14,320,409 $15,674,613
Cost of sales 12,881,717 14,924,938
Gross Profit 1,438,692 749,675
General and administrative expenses 1,535,808 1,395,388
Income (loss) from operations -97,116 -645,713
Other (Income) Expense
Interest income -8,985 -3,785
Rental income -187,020 -17,858
Commission income -3,846 -281
(Gain) loss on currency exchange 9,721 -10,720
Other income (expense) 24,518 -32,120
Reserve for bad debt 848,517 185,858
Equity in earnings of investee 38,167 -58,330
Miscellaneous 12,791 1,303
Loss on sale of fixed assets 78,247 32,068
Interest expense 147,914 112,922
Total Other (Income) Expense 960,024 209,057
Income (loss) before income taxes -1,057,140 -854,770
Provision for income taxes 336 109,890
Net income (loss) $-1,057,476 $-964,660
Net income (loss) per share
(basic and diluted)
Basic $-0.038 $-0.035
Diluted $-0.038 $-0.035
Weighted average number of shares
Basic 27,925,720 27,500,000
Diluted 27,925,720 27,500,000