MAI Systems Warns of 3rd-Quarter Loss
MAI Systems Corp. said Tuesday that it is likely to post a loss of up to $7.5 million for the third quarter because of delays in some installations of its hospitality software products.
MAI Systems also said it has hired Donaldson Lufkin & Jenrette Inc. to evaluate strategic options, including the potential sale of some assets.
The Irvine company said it expects to report third-quarter revenue in the range of $10 million to $11 million, down from revenue of $16.3 million in the second quarter. In the third quarter last year, the company earned $50,000 on revenue of $14.7 million.
MAI Systems said its third-quarter loss will include about $2 million to $2.5 million in costs for developing its LodgingTouch product and about $575,000 in deferred financing fees.
The company said revenue fell on its contract to supply software and services to the Joint Armed Services lodging facilities. Installations are just now beginning to accelerate and will continue through 2000 and beyond. Delivery had originally been expected to be well underway by the third quarter in 1999.
MAI Systems also said it expects positive cash flow in the first quarter of next year.
The company said that cost-control measures, including cutting employees and reducing dependency on outside consultants, reduced monthly expenses by more than $400,000.
In the fourth quarter last year, MAI Systems reported a loss of $2.5 million, or 24 cents a share, on revenue of $9.5 million.
The company’s stock closed unchanged at 69 cents a share on the American Stock Exchange.
More to Read
Inside the business of entertainment
The Wide Shot brings you news, analysis and insights on everything from streaming wars to production — and what it all means for the future.
You may occasionally receive promotional content from the Los Angeles Times.