News

GameCom/Ferris announces year-end results

April 3, 2002

ARLINGTON, Texas -- GameCom/Ferris Inc. (OTCBB:GAMZ), created out of the merger of kiosk entertainment firm GameCom Inc. and virtual reality developer Ferris Production Inc. last September, announced a consolidated net loss of $2,954,576 from revenue of $2,463,064 during fiscal year 2001, which ended on Dec. 31.

During 2000, the companies had combined total revenue of $3,359,126 and net losses of $1,351,871. The 2001 figures represent a loss of nine cents per share as compared to five cents in 2000.

Company officials said the expenses and energy needed to consummate the merger and launch development of products for the training-simulation market led in part to the losses. But GameCom/Ferris also admitted in its filing with the Securities and Exchange Commission (SEC) that its long-term viability remains shaky.

"The opinions of the Company's independent auditor for each of the last two fiscal years expressed substantial doubt as to the Company's ability to continue as a going concern," the report stated. "The Company will need substantial additional capital or new lucrative custom application projects to become profitable. Assuming that capital becomes available, or the Company is successful in achieving a major custom application project, the Company expects to achieve profitability within the next 12 months."

"While the Ferris acquisition provided an established stream of revenues, historically favorable gross margins, and potential lucrative markets, Ferris had not yet generated a profit," the report continued, "and substantial additional capital, or major highly profitable custom applications, will be needed for the Company's operations to become profitable."

As of Dec. 31, the company had total assets of $960,907 and total liabilities of $7,699,797, according to its SEC filing.

The company also disclosed that it is in the pre-trial phase of a $10 million lawsuit brought in Harris County, Texas, Judicial District Court, by Entertainment Technologies & Programs Inc. (ETPI).

ETPI sued Ferris for breach of contract after Ferris terminated a letter-of-intent with ETPI on April 17, 2001, and signed a similar agreement with GameCom a day later. GameCom/Ferris officials said the suit is without merit and will be vigorously defended.