Apropos Technology Reports Second Quarter Results

Apropos Technology Reports Second Quarter Results 


OAKBROOK TERRACE, Ill., July 26  /PRNewswire-FirstCall/ -- Apropos Technology
(NASDAQ:APRS), a leading provider of real time multi-channel interaction
management solutions, today reported revenues of $4.5 million for the second
quarter ended June 30, 2005 compared to $5.0 million for the second quarter
ended June 30, 2004.  Revenues for the six months ended June 30, 2005 were $8.7
million compared to $10.1 million for the six months ended June 30, 2004.

Net loss for the three months ended June 30, 2005, was $229,000, or loss of
$0.01 per share, which includes a restructuring credit of $187,000, or $0.01
per share.  This restructuring credit is due to the successful sublet of
vacated space at the corporate headquarters.  Net income for the comparable
three months ended June 30, 2004, was $109,000, or income of $0.01 per share,
which includes restructuring and other charges of $88,000 or $0.00 per share.
Net loss for the six months ended June 30, 2005, was $740,000, or a loss of
$0.04 per share, which includes a restructuring credit of $187,000, or $0.01
per share.  Net income for the comparable six months ended June 30, 2004, was
$124,000, or income of $0.01 per share, which includes restructuring and other
charges of $456,000, or $0.03 per share.

"This was a challenging quarter for the Company despite gaining traction with
new customers," stated Ken Barwick, Board member and acting CEO.  "We believe
the Company has a very solid product offering that is competitive in the
marketplace.  In addition, the Company continues to maintain a very strong
balance sheet and referencable customer base.  My focus will be on driving
process improvements, continuing to meet product deadlines, and maintaining our
high level of customer satisfaction."

"The Company continues to closely monitor its operating activities, using cash
from operations during the second quarter of approximately $220,000.  The
Company's cash and investment balances decreased from the prior quarter by
$167,000 to $41.1 million at June 30, 2005.  With the current quarter results,
the Company has reported quarterly increases in their cash and investment
balances six of the last seven quarters."

During the second quarter, the Company received new and add-on customer orders
from BMC Company, British Plaster Board, eBay Inc., Jacobs Engineering, and
Wolseley.  In addition, the Company entered into six new alliance partner
agreements during the quarter.

A conference call will be conducted by the Company at 5:00 p.m. Eastern Time
(ET) on Tuesday, July 26.  The conference call will be available to all
interested parties over the Internet.  To listen to the call on the Internet,
go to http://www.apropos.com/ or http://www.earnings.com/ at least fifteen
minutes early to register, download, and install any necessary audio software.
For those who cannot listen to the live broadcast, a replay will be available
shortly after the call at http://www.apropos.com/ , http://www.earnings.com/ or
by dialing 888-203-1112 or 719-457-0820 (international) and providing access
code 5408323.  The replay will be available by phone through August 2, and over
the Internet for 30 days.

About Apropos Technology

Apropos Technology, Inc. (NASDAQ:APRS) develops communications management
solutions for contact center operations and customer experience management.
Apropos solutions are largely used in customer service and support applications
for technical products and credit union member contact centers. Apropos
solutions integrate with existing systems to provide multi-channel interaction
management and a single, universal queuing system.  Organizations rely on
Apropos to differentiate, prioritize and intelligently route customers to the
right agent across voice, voicemail, e-mail, web chat, VoIP, and fax
communications.  Founded in 1989, the company serves over 300 clients worldwide
from its corporate headquarters in Oakbrook Terrace, Ill., and from its European
headquarters in the United Kingdom.  Additional information about Apropos and
its solutions can be found at http://www.apropos.com/ .

Apropos Technology statements contained in this press release that are not
purely historical are forward-looking statements within the meaning of Section
21E of the Securities and Exchange Act of 1934, including statements regarding
Apropos Technology's expectations, anticipations, goals, beliefs, targets,
hopes, intentions or strategies regarding the future.  Forward-looking
statements include statements regarding business model, product introduction
and acceptance, future sales, sales growth and sales channels, profitability
and results of operations, gross margins, operating expenses and financial
stability.  These forward-looking statements are subject to various risks and
uncertainties as more fully set forth under the caption "Risk Factors
Associated with Apropos' Business and Future Operating Results" in Apropos
Technology's Annual Report on Form 10-K for the year ended December 31, 2004,
as filed with the Securities and Exchange Commission.  Apropos Technology's
actual results and the timing of certain events may differ significantly from
the results discussed in the forward-looking statements; Apropos Technology
makes no commitment to disclose any revisions to forward-looking statements, or
any facts, events or circumstances after the date hereof that may bear upon
forward-looking statements.

                            -tables to follow-


                         Apropos Technology, Inc.
             Condensed Consolidated Statements of Operations
                 (In thousands, except per share amounts)


                             Three months ended         Six months ended
                                  June 30                   June 30
                             2005         2004          2005        2004
  Revenue                 (Unaudited)  (Unaudited)  (Unaudited)  (Unaudited)
    Software licenses        $ 1,358       $1,638      $ 2,458      $ 3,625
    Services and other         3,095        3,330        6,210        6,503
  Total revenue                4,453        4,968        8,668       10,128

  Cost of goods and services
    Cost of software              61          116           96          287
    Cost of services and other   995        1,020        2,072        1,871
  Total cost of goods and
   services                    1,056        1,136        2,168        2,158

  Gross margin                 3,397        3,832        6,500        7,970

  Operating expenses
    Sales and marketing        1,755        1,760        3,493        3,433
    Research and development   1,160        1,032        2,256        2,084
    General and
     administrative            1,176          946        2,183        2,043
    Restructuring and other
     charges (credit)           (187)          88         (187)         456
  Total operating expenses     3,904        3,826        7,745        8,016

  Income (loss) from
    operations                  (507)           6       (1,245)         (46)

  Other income (expense)
    Interest income              287          107          527          203
    Other income (expense),
     net                          (9)          (4)         (22)         (33)
  Total other income             278          103          505          170

  Net income (loss)            $(229)        $109        $(740)        $124

  Net income (loss) per share
    Basic                     $(0.01)       $0.01       $(0.04)       $0.01
    Diluted                        *        $0.01            *        $0.01

  Weighted-average number of
   shares outstanding
    Basic                     17,878       17,273       17,834       17,188
    Diluted                        *       18,614            *       18,575

  * Diluted weighted-average number of shares outstanding for 2005 are not
    shown as the effect would be anti-dilutive.



                         Apropos Technology, Inc.
                  Condensed Consolidated Balance Sheets
                              (In thousands)


                                             June 30            December 31
                                              2005                  2004
  Assets                                   (Unaudited)
  Current assets:
    Cash and cash equivalents               $ 24,045                $12,291
    Short-term investments                    17,027                 28,867
    Accounts receivable, net                   2,637                  3,155
    Inventory                                     43                     34
    Prepaid expenses and other current
     assets                                      407                    355

  Total current assets                        44,159                 44,702

  Equipment, net                                 533                    565
  Other assets                                    28                     21

  Total assets                               $44,720                $45,288

  Liabilities and shareholders' equity
  Current liabilities:
    Accounts payable                            $444                   $155
    Accrued expenses                           1,421                  1,854
    Deferred revenues                          3,592                  3,403
    Other current liabilities                    809                    856

  Total current liabilities                    6,266                  6,268

  Accrued restructuring, less current portion     --                    245

  Shareholders' equity
    Common shares                                179                    176
    Additional paid-in capital               103,571                103,155
    Accumulated deficit                      (65,296)               (64,556)

  Total shareholders' equity                  38,454                 38,775

  Total liabilities and shareholders'
   equity                                    $44,720                $45,288


DATASOURCE: Apropos Technology, Inc.



CONTACT:  Frank Leonard of Apropos Technology,    630-472-9600 ext. 7724,

+1-

 , or Leslie Loyet of Financial Relations Board,

[phone],  



Web site:  http://www.apropos.com/

http://www.earnings.com/ 

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