BELMONT, Mass., Nov. 15, 2005 (PRIMEZONE) -- Kronos Advanced Technologies, Inc. (OTCBB:KNOS) President and Chief Executive Officer Daniel R. Dwight said today that significant advances were made during the first quarter ended Sept. 30, 2005, toward the development of its standalone air purification product with the receipt of shipment of pre-production prototypes from its contract manufacturer in Mexico and China.
Mr. Dwight said that internal testing of the product has been completed and exceeded expected results under the protocol co-developed by Kronos and HoMedics, one if its residential consumer product partners, while IKEA, the home furnishings retailer, is testing a prototype product with Kronos' embedded technology for the residential market. "At the same time, we have new commercial products in the pipeline for the automotive and airline markets," he stated.
For the first three months of fiscal 2006, the ramp-up in investment made by the Company's wholly owned subsidiary Kronos Air Technologies, Inc., for product development in consumer standalone product applications and residential and transportation embedded product applications, as well as for business development activities in expanding the Company's base of new potential strategic partners, led to an increase in operating expenses to $832,000 in the first quarter ended Sept. 30, 2005, compared with $504,000 in the corresponding period the year before. Revenues were $15,000 compared with $241,000, resulting in a net loss of $973,000 compared with $622,000 for the first quarter of 2004. The decrease in revenue is the result of an increased focus on residential and consumer application for the Company's proprietary air movement and purification technology, while relying less on military funded projects.
Details of the Company's results can be found in its quarterly report filed Nov. 14, 2005 on SEC Form 10-QSB, at or at www.sec.gov or at www.kronosati.com.
Mr. Dwight also provided a summary of the Company's business highlights for the first quarter.
Standalone Platform
Consumer Products: In August 2005, Kronos received initial shipment of its standalone air purification products from its low-cost, contract manufacturer in Mexico and China. In October, the Company completed internal testing of these products under a testing protocol co-developed by Kronos and HoMedics, its standalone consumer products partner and a maker of personal care products. Kronos achieved the consistent target results that had been better than expected, including average air filtration rate of 99.99% of 0.3 micron sized particulates and above.
In addition, Kronos completed the development and testing of its proprietary software. This software, used in conjunction with Kronos proprietary electronics, effectively manages the operation of the Kronos' air purification product across diverse air qualities and room sizes.
Embedded Platform
Residential Products: Kronos completed the design and production of its first embedded residential air purification device co-developed by Kronos and IKEA. In September 2005, Kronos shipped the initial prototype device to IKEA in Sweden for testing and evaluation. The device is currently being tested by an independent testing facility in Europe.
Transportation Products -- Aircraft: Kronos completed the manufacture of its first air movement and purification device under contract with a leading business jet manufacturer. The product was designed to meet the customer's specific product application requirements, including airflow, air purification and all U.S. Federal Aviation Administration safety standards, including environmental, flammability and electromagnetic interference (EMI). Kronos is finalizing in-house testing of the initial prototype device and expects shipment to the customer in November 2005.
Transportation Products -- Automobile: In August 2005, Kronos extended its work into the transportation industry by signing a Prototype Development and Evaluation Agreement with a leading luxury automotive manufacturer. With assistance from the customer, Kronos completed design and manufacturing of the initial prototype device to meet exacting customer standards for placement inside automobile interiors. Kronos is completing in-house testing of the device and expects shipment to the customer in December 2005.
Other Business Development Activities
Kronos continues to seek to develop additional strategic partner relationships. Kronos leveraged positive industry press coverage it has received, including the June, September and October articles in "Appliance Design Magazine," "Auto Tech Daily," and "HVAC Inside," respectively, to expand the Company's potential partnerships. Kronos also expanded its product demonstration capability, enabling the Company to more effectively demonstrate to various potential customers who requested information on how the technology can be applied to their specific applications. Because Kronos now has the ability to more effectively demonstrate the benefits of the Kronos technology at either its Research and Product Development facility in Redmond, Wash., or directly at customers' facilities, the Company believes it has improved its sales process. Along with the IKEA and leading auto manufacturer opportunities, these demonstrations have led specifically to Kronos shipping product to other potential customers for further testing and evaluation, initial development of new customer/market driven applications, and additional customer initiated negotiations for establishing new partnerships.
Product Claims Platform
Kronos continues to seek expansion of its product claims platform. During the quarter, it obtained results of independent testing of Kronos standalone air purification product which was conducted at the air quality research laboratory of a U.S. university that specializes in submicron particle research. The results showed that the Kronos product was able to remove up to 99.8% of superfine airborne particles from 20 - 200 nanometers (0.02 - 0.20 microns) in size, at air speeds from 5 - 50 liters per minute. Various viruses and bacteria, including avian (bird) flu and Severe Acute Respiratory Syndrome (SARS), are in similar size ranges to the superfine air particles that were captured by the Kronos technology.
Stockholders' Meeting
Kronos will hold its Annual Stockholders' Meeting in Boston on Dec. 20, 2005. Details of the meeting will be provided in conjunction with the mailing of the Company's Proxy Statement to its Stockholders.
About Kronos Advanced Technologies, Inc.
Through its wholly owned subsidiary, Kronos Air Technologies, Inc., Kronos Advanced Technologies has developed a new, proprietary air movement and purification system that utilizes state-of-the-art high voltage electronics and electrodes to silently move and clean air without any moving parts. Kronos is actively commercializing its technology for standalone and embedded products across multiple residential, commercial, industrial and military markets. Kronos' technology is versatile, energy- and cost-efficient and exhibits multiple design attributes, creating a broad range of applications. The Company's business strategy includes a combination of building internal capabilities, establishing strategic alliances and structuring licensing arrangements. Kronos Advanced Technologies is located in Belmont, MA. More information about Kronos Advanced Technologies is available at www.kronosati.com.
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Forward-Looking Statements
With the exception of historical information contained in this press release, this press release includes forward-looking statements and comments. Such statements are necessarily subject to risks and uncertainties, some of which are significant in scope and nature beyond the Company's control. Forward-looking statements, by their nature, involve substantial risks and uncertainties. As a result, actual results may differ materially depending on many factors, including those described above. The Company cautions that historical results are not necessarily indicative of the Company's future performance. Other risks are summarized under the caption "Certain Business Risk Factors" in the Company's Annual Report on Form 10-KSB for the year ended June 30, 2005 as filed with the Securities and Exchange Commission.