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Late Report Shows Drop in Sales at Golden Systems

May 23, 2000

Golden Systems in Simi Valley has released its annual report for the fiscal year ended March 31, 1999, action that was delayed because of the company's poor financial condition.

Company officials said it will soon file a report for the quarter ended March 31, 2000.

Golden Systems designs power switching supplies.

Sales for fiscal year 1999 were $3.9 million, compared with $4.5 million for the previous year. The decrease is due principally to a drop in shipments to one customer and a decision to no longer do business with another, officials said.

For fiscal year 1999, the company reported a loss from operations of just over $2 million before a credit of $2.1 million related to the cancellation of accounts payable for which no demand was made for payment. With the inclusion of the special credit, the company earned a net profit of $113,000 or 2 cents per share, compared with a loss of $3.7 million or 70 cents per share the year before.

The company's annual report discloses $9.5 million in debts due Indian lenders, all of which are currently in default. Three banks have issued notices to the company demanding immediate repayment of $8.6 million.

The report also says the company continued to incur significant losses and management has been unsuccessful in its efforts to achieve profitable operations and positive cash flow.

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