BELMONT, Mass., Sept. 29, 2006 (PRIMEZONE) -- Kronos Advanced Technologies, Inc. (OTCBB:KNOS) President and Chief Executive Officer Daniel R. Dwight today announced that during the fiscal year ending June 30, 2006, the Company continued to make advances and remained focused on getting its proprietary technology into the product production stage for marketing by its strategic partners. A review of fiscal 2006 operating results and forecast for 2007 are provided below.
The Company's primary business objectives over the prior 12 months were to launch Kronos-based standalone consumer products and to establish strategic partners for developing and commercializing embedded product applications. During the year, despite the success of the Company in developing and testing a viable consumer product, the Company was not able to achieve its first objective of having its residential, retail consumer products partner bring that product to market; in September 2006, the Company sent notice of termination of its license agreement with that partner, HoMedics USA, Inc. The Company took this action to protect the Company's assets and to position the Company to identify new strategic partner(s) in the residential marketplace who have the willingness and viability to bring Kronos-based consumer air purification products to market.
Kronos did achieve its second objective: in June 2006, the Company executed its first license for embedded applications of Kronos technology with DESA, LLC. The agreement provides DESA the opportunity to embed the Kronos electrostatic air movement technology within fireplaces, hearth systems, zone heaters and mounted electric fans and heaters. In addition, during the year the Company:
1) executed a non-exclusive license agreement with EOL, LLC, a
Russian Federation company, for manufacturing and distributing
Kronos-based commercial standalone products in Russia and
other select Commonwealth of Independent States; clinical
trials for EOL's Tree(tm) air purification device are
currently being conducted under direction of the Russian
Research Institute of Medical Equipment and EOL has
initiated product production;
2) shipped a prototype device designed and built under specific
customer specifications to a leading auto manufacturer for
their testing and evaluation;
3) obtained an award from the Washington Technology Center in
conjunction with the University of Washington and Intel
Corporation for continued funding for a research and
development project based on a novel cooling system for
microelectronics and computer chips;
4) completed the initial design and development of space heaters
and vaporizers, which are undergoing evaluation by potential
strategic partners;
5) was invited to serve as a member and an industrial partner in
the Federal Aviation Administration's (FAA) Air Transportation
Airliner Cabin Environment Research Center of Excellence
(ACER CoE); and
6) pursued new opportunities initiated by several leading global
home appliance manufacturers for the development of select
residential applications of our technology, including silent
kitchen range hoods. This later opportunity was a direct
result of our initial development work with Ikea.
The Company was able to achieve these successes through the expansion of (i) our product claims platform to include independent verification of Kronos' technology's ability to decontaminate rooms infected with bacteria and viruses and sterilize air flows contaminated with anthrax and E.coli spores, S. aureus and B. cereus bacteria, and mildew; (ii) our technical resources and product engineering to better position Kronos' ability to address specific customer issues and needs; and (iii) our intellectual property. Regarding the later point, the Company received notification that an additional four of its patent applications during the year and three subsequent to the fiscal year end have been allowed for issuance by the United States Patent and Trademark Office.
The Company's primary business objectives over the next 12 months are to execute on our agreements with DESA and EOL, to establish new strategic partner(s) for marketing and selling Kronos-based, standalone air purification products, and to establish additional strategic partners for developing and commercializing new product applications.
Financial
During fiscal 2006, the Company's wholly owned subsidiary Kronos Air Technologies, Inc. continued to make investments in product development across both commercial and consumer standalone product applications and residential and transportation embedded product applications, as well as for business development activities to further expand the Company's base of new potential strategic partners. The increased activity led to an increase in operating expenses to $3.7 million for the year ended June 30, 2006 compared with $2.8 million in the prior year. The net loss, however, decreased for the year ended June 30, 2006 to $4.0 million compared with $7.1 million for the corresponding period as the Company incurred a non-recurring charge ($3.9 million) associated with refinancing during the prior period, partially offset by the increase in operating expenses. Revenues were $0.2 million compared with $0.4 million. The decrease in revenue resulted from decreased reliance on military funded projects and an increased focus on residential, consumer and commercial applications.
Details of the Company's results can be found in its annual report filed September 28, 2006 on SEC Form 10-KSB, at or at www.sec.gov or at www.kronosati.com.
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.
Safe Harbor Provision
This news release contains forward-looking statements made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, the Company's views on future financial performance, market growth, capital requirements, new product introductions and acquisitions, and are generally identified by phrases such as "thinks," "anticipates," "believes," "estimates," "expects," "intends," "plans," and similar words. Forward-looking statements are not guarantees of future performance and are inherently subject to uncertainties and other factors which could cause actual results to differ materially from the forward-looking statement. These statements are based upon, among other things, assumptions made by, and information currently available to, managements, including management's own knowledge and assessment of the Company's industry, R&D initiatives, competition and capital requirements. Other factors and uncertainties that could affect the Company's forward-looking statements include, among other things, the following: identification of feasible new product initiatives, management of R&D efforts and the resulting successful development of new products and product platforms; acceptance by customers of the Company's products; substantial expansion of international sales; reliance on key suppliers; the potential need for changes in long-term strategy in response to future developments; and competitive factors, including pricing pressures and the introduction by others of new products with similar or better functionality than our products. These and other risks are more fully described in the Company's filings with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-KSB for the year ended June 30, 2006. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.