WEST CHICAGO, Ill., April 14, 2004 (PRIMEZONE) -- On April 8, 2004, M-Wave, Inc. (Nasdaq:MWAV) filed its Form 10-K for the year ended December 31, 2003 with the Securities and Exchange Commission. Included in the Form 10-K are consolidated financial statements of the Company that are audited by Grant Thornton LLP, independent auditors, for the year ended December 31, 2003.
Grant Thornton LLP has issued an opinion with respect to the financial statements that raises substantial doubt about the Company's ability to continue as a going concern and references in that respect Note 3 to the financial statements.
In particular, the opinion states: "As discussed in Note 3 to the financial statements, the Company incurred a loss during year ended December 31, 2003, and as of that date, the Company's current liabilities exceeded its current assets. These factors, among others, as described in Note 3, raise substantial doubt about the Company's ability to continue as a going concern. The 2003 financial statements do not include any adjustments that might result from the outcome of this uncertainty."
In response to the opinion, Jim Mayer, Managing Member of Credit Support International, LLC, Chief Restructuring Advisor to M-Wave's Board of Directors, commented: "We clearly understand that as of December 31, 2003 the impact of our restructuring was not evident. However, as publicly disclosed in press releases and related SEC filings beginning in February 2004 and as a subsequent event in the Company's 2003 Form 10-K Report filed last week, M-Wave is effecting a significant restructuring of its operations and financial condition. In particular, the Company changed its business model to cease domestic manufacturing, which had become unprofitable, in favor of providing domestic and offshore supply chain management services to its customers; sold its manufacturing assets; paid all its bank term debt; reduced by 83% its delinquent vendor debt, that was originally $3.1 million and is scheduled to be fully paid by May 31, 2004 and closed on an accounts receivable purchase facility March 31, 2004, providing for funding of up to $2.5 million with Silicon Valley Bank. These factors, combined with a general upswing in our printed circuit board business, give us confidence that M-Wave will have sufficient capital resources to successfully complete the restructuring during fiscal year 2004."
About M-Wave, Inc.
Established in 1988 and headquartered in the Chicago suburb of West Chicago, Illinois, M-Wave is a value-added service provider of high performance circuit boards. The Company's products are used in a variety of telecommunications and industrial electronics applications.
M-Wave services customers like Federal Signal on digital products and Celestica -- Nortel and Remec with its patented bonding technology, Flexlink IITM, and its supply chain management services including Virtual Manufacturing (VM) and the Virtual Agent Procurement Program (VAP) whereby customers are represented in Asia either on an exclusive or occasional basis in sourcing and fulfilling high volume and technology circuit board production in Asia through the Company's Singapore office.
The Company trades on the Nasdaq National market under the symbol "MWAV." Visit the Company on its web site at www.mwav.com.
About Credit Support International (CSI)
Established in 1991 by a European-American joint venture between Groupe Warrant of Belgium and DiversiCorp, Inc. of Dallas, Texas, CSI provided cross-border collateral control that linked lenders to their assets located both inside the U.S. and Western Europe. In 1998, CSI was split off from the two partner companies and evolved into a specialized consulting firm devoted to transitional and troubled middle market companies. Jim Mayer, its Managing Member, has 18 years of experience including 12 years as CEO of DiversiCorp, Inc. and has managed or directed more than 50 engagements with troubled companies and provided a variety of services directly to clients including: due diligence, workout, collateral control, corporate restructuring, bankruptcy support, cross-border secured finance and interim management. Mayer has served on several boards of directors including the Turnaround Management Association.
This news release contains predictions and other forward-looking statements that involve a number of risks and uncertainties. While this outlook represents our current judgment on the future direction of the business, such risks and uncertainties could cause actual results to differ materially from any future performance suggested above. Such risks and uncertainties include those factors detailed in the company's annual report on Form 10-K and other reports filed by the company with the U.S. Securities and Exchange Commission.
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