SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): March 23, 2005
ION NETWORKS, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 000-13117 22-2413505
--------------------------------------------------------------------------------
(State or Other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
120 Corporate Boulevard
South Plainfield, New Jersey 07080
--------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
(Registrant's telephone number, including area code): (908) 546-3900
--------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
Form 8-K for ION NETWORKS INC
--------------------------------------------------------------------------------
23-Mar-2005
Press Release for Results of Operations and Financial Conditions
ITEM 2.02. Results of Operations and Financial Conditions.
ION Networks Reports Financial Results for Year
Ended December 31, 2004
SOUTH PLAINFIELD, N.J.--(BUSINESS WIRE)--March 23, 2005--ION Networks
Incorporated (OTC: IONN.OB), a leading provider of solutions that secure access
and administration to a wide variety of devices serving voice and data networks,
announced today results for the year ended December 31, 2004.
Net sales for the year ended December 31, 2004 were $3,616,000 compared to
$3,343,000 for the previous year. Net losses incurred were $250,000 or $0.01 per
share for 2004 compared to $604,000 or $0.03 per share for the year 2003.
Gross margin grew from $2,450,000 for the year ended December 31, 2003 to
$2,550,000 for 2004. This increase in gross margin was due to increased revenues
offset by a slight reduction in prices. Operating expenses including selling,
general & administrative expenses, research & development and depreciation &
amortization expenses declined from $3,692,000 to $3,322,000 a $370,000
reduction. This improvement was due primarily to lower depreciation, facilities
costs, professional services and insurances expenses. The benefits from
restructuring activities declined to $181,000 for the year 2004 from $405,000
for the year ended December 31, 2003.
"We are proud of the progress we made during 2004 particularly during the
second half of the year," said Norman E. Corn, ION's Chief Executive Officer.
"Though we continue to face many challenges we are excited about our
opportunities in 2005."
About ION Networks
ION, headquartered in New Jersey, is the leading provider of products that
protect network administrative interfaces from improper, unauthorized or
otherwise undesirable access by either external or internal sources. ION,
founded in 1982 as MicroFrame, has over 300 customers in 35 countries. There are
over 50,000 ION devices currently in use today worldwide. ION distributes its
products throughout the world through partnering arrangements with large
well-known telecommunications and service providers, such as Avaya and AT&T and
counts many Fortune 500 companies among their clients.
More information can be obtained from www.ion-networks.com.
Included in this release are certain "forward-looking" statements,
involving risks and uncertainties, which are covered by the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995, including
statements regarding the Company's financial performance. Such statements are
based on management's current expectations and are subject to certain factors,
risks and uncertainties that may cause actual results, events and performance to
differ materially from those referred to or implied by such statements. These
statements include, but are not limited to, statements regarding the Company's
plan to secure additional capital. In addition, actual future results may differ
materially from those anticipated. The factors that could cause actual future
results to differ materially from the forward-looking statements include the
following: sales and earnings growth, ability to attract and retain personnel,
technological changes, product development, competition, protection of our
intellectual property, our working capital balance and our reliance on several
key customers and members of our management, uncertainties relating to global
political conditions, such as terrorism. Information with respect to important
factors that should be considered is contained in the Company's Annual Report on
Form 10-KSB, the Company's Quarterly Reports on Forms 10-QSB, and other filings
and releases as filed with the Securities and Exchange Commission. Readers are
cautioned not to place undue reliance on these forward-looking statements, which
speak only as of the date hereof. The Company does not intend to update any of
the forward-looking statements after the date of this release to conform these
statements to actual results or to changes in its expectations, except as may be
required by law.
ION Networks(TM) is a trademark of ION Networks, Incorporated. All other
trademarks and registered trademarks in this document are the properties of
their respective owners.
ION Networks, Inc and Subsidiary
Consolidated Balance Sheets
December 31,
Assets 2004 2003
------------------------
Current assets
Cash and cash equivalents $287,437 $357,711
Accounts receivable, less allowance for
doubtful accounts of $16,923 and $66,549,
respectively 578,491 397,744
Inventory, net 511,426 702,042
Prepaid expenses and other current assets 78,436 128,138
------------------------
Total current assets 1,455,790 1,585,635
Property and equipment, net 11,847 57,432
Capitalized software, net 406,351 448,288
Other assets 12,836 13,301
------------------------
Total assets $1,886,824 $2,104,656
========================
Liabilities and Stockholders' Equity
Current liabilities
Current portion of capital leases - 73,551
Current portion of long-term debt 2,311 2,202
Accounts payable 354,602 340,740
Accrued expenses 549,730 574,930
Deferred income 160,212 200,305
Sales tax payable 6,075 52,640
Other current liabilities 10,000 53,337
------------------------
Total current liabilities $1,082,930 $1,297,705
------------------------
Convertible debenture - related party 204,167 -
Long term debt, net of current portion 6,942 9,441
------------------------
Total liabilities $1,294,039 $1,307,146
------------------------
Commitments and contingencies
Stockholders' equity
Preferred stock - par value $.001 per
share; authorized 1,000,000 shares at
December 31, 2004 and 2003; 200,000 shares
designated Series A at December 31, 2004
and 2003; 158,335 and 166,835 shares
issued and outstanding at December 31,
2004 and 2003;(Aggregate Liquidation
Preference $285,003 and $300,303 at
December 31, 2004 and 2003, respectively) 158 167
Common stock - par value $.001 per share;
authorized 50,000,000 shares at December
31, 2004 and 2003; 22,610,500 and
24,875,500 shares issued and outstanding
at December 31, 2004 and 2003 22,611 24,876
Additional paid-in capital 44,146,594 44,585,740
Notes receivable from former officers - (486,535)
Accumulated deficit (43,576,578)(43,326,738)
------------------------
Total stockholders' equity 592,785 797,510
------------------------
========================
Total liabilities and stockholders' equity $1,886,824 $2,104,656
========================
ION Networks, Inc and Subsidiary
Consolidated Statement of Operations
Year Ended
December 31,
2004 2003
----------------------
Net sales $3,616,261 $3,342,620
Cost of sales 1,065,443 892,373
----------------------
Gross Margin 2,550,818 2,450,247
----------------------
Research and development expenses 598,012 503,146
Selling, general and administrative expenses 2,314,834 2,452,031
Depreciation and amortization expenses 409,485 736,694
Restructuring, asset impairments and other
credits (180,533) (405,402)
----------------------
Loss from operations (590,980) (836,222)
Interest income 25,810 19,872
Interest income/(expense)-related party (4,167) -
Interest income/(expense) (3,334) (14,593)
----------------------
Loss before income taxes (572,671) (830,943)
Income tax benefit 322,831 227,151
----------------------
Net Loss $(249,840) $(603,792)
======================
Per share data
Basic & Diluted $ (0.01) $ (0.03)
Weighted average number of common shares
outstanding
Basic & Diluted 23,294,325 23,900,500
CONTACT: Investor/Press:
ION Networks, Inc.
Mark Santus, 908-546-3903
investor-relations@ion-networks.com
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: March 24, 2005 ION NETWORKS, INC.
By: /s/ Patick E. Delaney
-----------------------
Patrick E. Delaney
Chief Financial Officer